Advisory Insights

March 2025

Thanks for being part of our network and our growing readership. Whether you’ve been with us since we launched this newsletter nearly a year ago or you’re joining us for the first time, we appreciate your interest. Each month, we bring you the latest stories we’re following, an interview with someone from our network, a summary of notable fintech product launches, and a list of upcoming events shaping the fintech community.

  • The Storyline

The Trump administration continues to reshape the regulatory landscape. Jonathan Gould was nominated as Comptroller of the Currency and Jonathan McKernan to lead the CFPB. McKernan’s nomination comes as the acting director, Russell Voight, has ordered staff to cease “all supervision and examination activity”. Meanwhile, the FDIC released 175 documents detailing its supervision of banks involved in crypto-related activities following a court-ordered deadline, providing transparency into the regulator’s approach to digital asset oversight. The SEC announced that it was dropping several high profile digital asset related investigations.

Public markets activity continues to gain momentum, with several fintechs exploring public offerings. Brex is reportedly eyeing $500 million in 2025 revenue as it considers a potential IPO. Gemini is in discussions for an IPO as soon as this year, while crypto custodian BitGo is also considering going public as soon as the second half of the year as institutional demand for digital asset services grows. In private markets, secondary transactions are providing liquidity for early investors and employees, with activity including Plaid’s reported $400 million potential secondary sale and Deel’s completion of a $300 million secondary transaction that brought General Catalyst on as an investor. Stripe confirmed a tender offer valuing the company at $91.5 billion, up from $70 billion a year ago, as the company announced its payment volume grew 38% to $1.4 trillion in 2024.

The fintech funding landscape showed continued momentum, with Sardine raising $70 million in Series C funding to make fraud and compliance teams more productive, and Taktile securing $54 million in Series B funding to help fintechs build automated decision-making workflows. FairPlay secured $10 million in funding to help financial services companies eliminate bias in AI-driven lending decisions. Mercury is in talks with Sequoia to lead new funding at over $3 billion valuation. After raising $1 billion previously, Varo closed another $29 million round and replaced its founder CEO. ModernFi raised $18.7 million in Series A funding to power deposit growth at community and regional banks. In the digital assets space, stablecoin blockchain startup Plasma raised $20 million to enhance its payment infrastructure.

M&A transactions showed strategic consolidation across various fintech segments. Marqeta announced the acquisition of TransactPay, strengthening its card program management capabilities in Europe. The announcement coincided with leadership changes as the company named Mike Milotich as interim CEO. Betterment expanded its robo-advisory capabilities by acquiring Ellevest’s automated investing business, strengthening its position in the wealth management space. Drata acquired SafeBase to enhance its trust management offerings, while private equity firm Veritas engaged in discussions to acquire business data firm Dun & Bradstreet at around its current market cap of $5.4 billion. Coinbase continued its expansion beyond cryptocurrency trading by acquiring ads platform Spindl to address the “onchain discovery problem”. LexisNexis Risk Solutions completed its acquisition of IDVerse, bolstering its identity verification capabilities. Core banking provider nCino acquired Sandbox Banking, while Worldpay added AI-powered fraud prevention to its suite through the acquisition of Ravelin. Lastly, Alkami announced it will acquire MANTL in a $400 million deal. 

Strategic partnerships continue to reshape financial services delivery models. Klarna signed with J.P. Morgan Payments to expand its merchant services offerings, while FIS partnered with Affirm to bring integrated pay-over-time capabilities directly to debit issuing banking clients. Canopy Servicing and Moov joined forces to transform loan repayments for lenders, and Square selected Peach to power its innovative credit card program. Lithic and Veritex Community Bank partnered to expand credit-based financial solutions, while Jack Henry and Moov implemented Visa Direct to enable fast, seamless payments. TransUnion tapped Credit Sesame for direct-to-consumer credit scores in the U.S., and Spade partnered with Stripe to unlock real-time merchant intelligence. 

The stablecoin and cryptocurrency ecosystem continues to evolve. Bank of America CEO Brian Moynihan indicated that the bank will likely launch a stablecoin if comprehensive U.S. legislation is passed. Figure launched the industry’s first yield-bearing stablecoin as an SEC-registered public security, while Cedar Money raised $9.9 million in seed funding led by QED Investors to enable cross-border stablecoin payments. Kraken introduced its payment service, Kraken Pay, and secured a MiFID license to offer a regulated derivatives exchange. London fintech startup Brava launched a stablecoin management system, and Fold expanded its relationship with Visa to accelerate Bitcoin rewards card programs. Coinbase obtained VASP registration in the U.K. to strengthen its regulated status.

  • Network Spotlight

FS Vector has had a great relationship with Bridge. Along the way, I’ve grown close with Zach Abrams, co-founder and CEO, and Eric Weingarten, Chief Legal Officer & Chief Compliance Officer. From my very first conversation with Zach in August 2022, I was impressed by their willingness to do the hard things. It’s no surprise to see where they are today. Here is my conversation with Zach and Eric, following Bridge’s $1.1bn acquisition by Stripe.

Interview conducted by Trevor Tanifum, Managing Principal

Eric, what drew you to Bridge? And Zach, why did Bridge hire a full-time General Counsel so early?

Eric: Zach and Sean’s proven ability to execute, make decisions, and cut through the noise. I had advised many startups after I left Coinbase, including Bridge, but Zach and Sean were in a different category in their ability to focus on what mattered and move quickly. Their developer-focused API approach made sense to me. Importantly, what they were building was in a space that I had been thinking about for some time. Bridge’s stablecoin thesis was very much aligned with observations I had going back to 2018 when I joined Coinbase and first started working with Zach.

Zach: We knew from day one that building an enduring business would require enormous regulatory investment. Moreover, we started in 2022 and launched shortly after FTX collapsed – every financial partner was skeptical of anything crypto. We had to prove that Bridge was taking regulatory and compliance matters very seriously.

Bridge chose to invest in applying for regulatory licenses in the US and Europe, at a time when the entire market was cold on stablecoin. Why?

We believed deeply that stablecoins would become core, global financial infrastructure. As such, we knew they would eventually be highly regulated – and when that happened, we would need all of these licenses and this infrastructure to continue scaling and building our business.

Regulation was more of a distraction than a competitive advantage. The regulatory environment was / is confusing and many pushed us to invest in lobbying, etc. We spent dozens of hours on calls prognosticating regulatory change – which was all wasted time. I would recommend all start ups focus on execution.

Compliance on the other hand was incredibly important from day 1. We’ve built enormous trust with federal and state regulators, banks and other financial partners. Our ability to provable and safely serve our markets has been and will continue to be a huge advantage. We have many competitors and most have struggled in this domain.

Let’s talk about Stripe. A sale is often thought of as an ‘exit.’ I get the sense that Bridge isn’t exiting anything, anytime soon. What can we all look forward to from the Bridge team, post-Stripe?

We’re incredibly excited about joining forces with Stripe. We will continue to operate independently and Stripe will become a very large consumer of our APIs. We started the company 3 years ago, so we’re very early in the journey. We have a lot left to build.

One Personal Question: What did your grandparents do for a living?

Zach: My grandfather was a professional football coach. He eventually became the defensive coordinator for the Lions. He had 3 daughters and had high hopes that I’d be a football player. Disappointingly I weighed about 100 lbs in high school and took a different path.

Eric: My mom’s dad was a lawyer, a solo practitioner, and after he passed away, her mother ran an advertising business. My father’s dad was an independent cab driver. He organized the independent cab drivers in Buffalo to win the airport cab service contract away from the larger cab operations. I guess startups and the entrepreneurial spirit run deep in my family.

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