Diversity is good for business, central bank digital currencies, and purple iPhones 💜
Welcome to Nº 21 of In The Money, your weekly newsletter on keeping up with all things finance, tech, and startups. As always, this week’s newsletter is filled with all the financy things. This week Apple held its Spring Loaded event and released some cool (and colorful) new gadgets. Starling Bank raised funding from Goldman Sachs. Squarespace filed for IPO, while UiPath hit the public markets. The luggage start-up Away is also eyeing a public market listing. In this edition, we also discuss central bank digital currencies or CBDCs and how corporates are getting into the crypto space. There is also a segment on why diversity is good for business. This and much more. I hope you enjoy this edition. And btw, April is financial literacy month. My aim and hope with this newsletter is to contribute to increasing financial literacy.
Away for IPO 🧳
On Thursday, Away, the luggage company valued at $1.45 billion, named co-founder Jen Rubio chief executive officer after she spent two months in the role on an interim basis. Rubio is taking the reins at a precarious time. The pandemic upended travel, and Away’s revenue fell about 55% last year. Before that, the company was plagued by a report in December 2019 that its workplace culture, under the leadership of co-founder and then-chief executive Stephanie Korey, upset lower-level employees. Before launching Away, Rubio and Korey worked at eyewear brand Warby Parker and used then a similar direct-to-consumer business model to disrupt luggage. In 2019, Away hit unicorn status after a funding round pushed its value above $1 billion. Now Rubio, who previously served as Away’s president, has to revive the brand as the company and its investors, which include Wellington Management and Comcast Ventures, eye a potential initial public offering. In an interview with Bloomberg, Rubio said that the company is looking toward a potential IPO. Rubio succeeds Stuart Haselden, who left in January after taking over from Korey.
Squarespace also to go public 💻
Last Friday, Squarespace, the company which makes software for people to build websites, filed to go public on the New York Stock Exchange under the symbol “SQSP". The company is eschewing a traditional initial public offering, with a direct listing. ITM has covered the difference between a direct listing and a traditional listing previously. But essentially in a direct listing a company only sells existing shares to the public market to let earlier investors and employees get liquidity. No new shares are issued. The direct listing mechanism has become increasingly popular, with tech companies Slack, Spotify, Palantir, Roblox, and most recently Coinbase all choosing direct listings in recent years. Last month, Squarespace raised $300 million in funding. In 2020, the company reported $621.1 million in revenue, up 28% year over year. At the end of the year, Squarespace had more than 3.6 million subscriptions, up about 23%. Rather than targeting big enterprises, Squarespace focuses on self-employed people and small businesses. Squarespace was founded in 2003. It is based in New York, with 1,256 employees at the end of 2020. You can deep dive into the S-1 filing here.
Starling’s fresh funding 💸
British digital bank Starling raised £50 million ($69 million) in funding from Goldman Sachs. ITM reported on Starling’s last investment of £272 million just last month that valued the online lender at £1.1 billion. Starling’s founder and CEO, Anna Boden, was also featured as Woman of the Week in that edition. The deal with Goldman is still subject to regulatory approval. “Securing the support of another global financial heavyweight demonstrates the strength of demand from investors and represents yet another vote of confidence in Starling,” said Anne Boden. Starling is one of the UK’s biggest neobanks, (a term used to describe the wave of fintech start-ups founded in the last decade with the aim of taking on the incumbent banks with branchless banking). Starling differentiates from rivals like Revolut and Monzo with a focus on small business banking. Another thing that separates Starling from its competitors is that it’s managed to turn a profit. Neobanks have been loss-making for years and now are under heightened pressure to prove they can make money. Goldman’s investment in the company comes after reports that JPMorgan and Barclays had shown an interest in buying Starling which Starling has denied. Big banks are increasingly looking to partnerships with tech firms to remain relevant at a time with smartphone banking. In 2018 Goldman launched its own competing digital bank called Marcus in the UK. The bank temporarily paused applications for its easy-access savings account in Britain last year due to a surge in deposits during the country’s initial Covid lockdown. It’s since reopened applications to UK savers. Goldman is not the only US banking giant taking on the UK market. JPMorgan is launching its own digital banking brand for British customers.
Amazon opens a hair salon 💇♀️
Amazon announced on Tuesday that it is opening Amazon Salon, the retailer’s first hair salon. The salon will be a place where Amazon aims to test new technologies with the general public. The salon will occupy over 1,500 sq. ft on Brushfield Street in London’s Spitalfields, where Amazon says it will initially be testing the use of augmented reality (AR) and “point-and-learn” technology, a system that allows customers to point to products on a display shelf in order to learn more through videos and other content that then appears on a display screen. To order the products, the customers will scan the QR code on the shelf, which takes them to the Amazon shopping page for the item where they can add it to their cart and check out. Meanwhile, the AR technology will allow customers to experiment by virtually trying on different hair colors before making a commitment to a new shade. Amazon has already entered the convenience store market, grocery business, and other physical retail. In these, it is innovating with new technologies like cashier-less checkout, smart grocery carts, and biometric systems. It is not, however, clear if Amazon actually has ambitions to be in the salon business itself. Instead, it seems the salon will largely serve as a testing ground for new technologies that Amazon will likely want to sell to other retail clients. And in the case of AR, Amazon may want to gather data it can use on its own shopping site, too.
This week, Amazon also announced that Whole Foods (which Amazon is the owner of) will launch a palm reader payment system at its Madison Broadway location in Seattle. It plans to roll out the biometric program at seven more stores in the coming months. The electronic palm readers, known as Amazon One, allow people to pay for everything in their cart with a swipe of their hand. Yes, you read it correctly, by paying with your hand.
Spring Loaded 🍏
Here’s everything Apple announced at its Spring Loaded event on Tuesday:
Apple Card got a shift in how it works with the new Apple Card Family function which allows you to share your card with anyone in your family over the age of 13. You can add customizable spending limits for each user. You can also co-own a card with another adult in order for both owners to build up their credit.
Purple iPhones, yes, a new color 💜
Podcasts, the Podcasts app got a redesign and an option for paid subscriptions for individual podcasts
AirTags, the accessory for tracking items like keys, wallets, and bags was released. You use them through the ‘Find My’ app. AirTags will cost $29 each or $99 for a four-pack and will launch on April 30th.
Apple TV, the remote got a redesign and Apple TV is now powered with Apple’s A12 Bionic chip.
iMacs, got the M1 chips Apple introduced to laptops last year. The new iMacs also come in seven different colors, with a webcam, and a 24-inch, 4.5K display.
iPad Pros are also getting the M1 and according to Apple, this will give the iPad Pros a 50% performance improvement
Trade-in Lululemon 🧘♀️
Lululemon announced on Tuesday it is piloting a trade-in program next month. The leggings and sports bra maker also plans to expand the program to online resale in June. Starting in May, Lululemon customers in California and Texas will be able to trade in gently used Lululemon items in a store or by mail in exchange for a Lululemon gift card. Then in June, those gently used items will also be sold online to people who want to pay less and don’t mind a bit of wear. The company is calling the pilot “Like New.” To make it happen, Lululemon is partnering with Trove, a business that already helps brands like Levi’s and Patagonia build out resale marketplaces. According to Lululemon, all traded-in items will be cleaned, and the items that don’t meet its quality standards will be recycled. The company is working toward sustainability goals that it laid out last fall, including making 100% of its products with sustainable materials and end-of-use solutions by 2030. Lululemon is not the first retailer to experiment with resale. Businesses are feeling a greater urge to do so when they see that sites like Poshmark and Depop, which sell used goods, are flooded with their products. Last year, Levi Strauss & Co. debuted a buyback program for its jeans called SecondHand. Nike announced earlier this month a new initiative to accept gently worn sneakers. Also, retailers Gap, Macy’s, and Nordstrom have experimented with the secondhand market, too, by partnering up with ThredUp. Thrifting is increasingly popular with Gen Z, a generation that prioritizes environmental concerns. Mentions of thrift and consignment stores ranked No. 10 on a list of teens’ favorite brands this spring, according to Piper Sandler’s report. According to a report from Jefferies, the secondhand market generates nearly $30 billion in sales annually in the US, and it expects the market will grow.
Filter that 🙅♀️
Facebook and its family of apps have long grappled with the issue of how to manage and eradicate harassment on its platform. It has turned to both algorithms and humans in its efforts to tackle the problem better. In the latest development, Instagram announced new tools of its own. The first being a new way for people to shield themselves from harassment in their direct messages. Specifically, in message requests by way of a new set of words, phrases, and emojis that might signal abusive content (it will also include common misspellings of those key terms). Second, Instagram is giving users the ability to proactively block people even if they try to contact them over a new account. The blocking account feature is going live globally in the next few weeks. These features are only being rolled out on Instagram, not Messenger, nor WhatsApp, Facebook’s other two hugely popular apps for direct messaging. Instagram said that the feature to filter direct messages will be based on a list of words and emojis that Facebook compiles with the help of anti-discrimination and anti-bullying organizations along with terms and emoji’s that you might add in yourself. It has to be turned on proactively, rather than being made available by default.
Diversity is good for business 🔝
A Boston Consulting Group report ‘How Women Make It to the Top in Technology’ found that:
Adding one more woman to a company’s board or management team, while keeping the overall size of the board unchanged, correlates with an increase of return on assets (ROA) of 8 to 13 basis points.
Companies with at least 3 female directors had a median increase in return on equity (ROE) over five years that was 11% higher than that of companies with no female directors.
Firms, where 30% of leaders are women, have a 15% increase in profitability compared with similar firms with no female leaders.
The below tweet is something I’ve been thinking of a lot lately. Why work for someone else when you can pursue your passion and build something meaningful yourself? Would love to hear your thoughts on this. Feel free to take the discussion to Twitter, DM me, comment on this post, or whatever floats your boat.
In crypto news 💎
Be prepared for the next section to be very focused on a lot of cryptocurrency news. The news includes volatility in the crypto market, nations planning central bank digital currencies, and corporates accepting cryptocurrencies as payments.
Bitcoin Let’s begin with Bitcoin which experienced a turbulent week, after ITM last week reported that the world’s largest digital currency reached record highs, it suffered a flash crash last Saturday, plummeting 14%, to attempting to bounce back Monday. However, Bitcoin fell 0.7% against the US dollar around the time the stock market closed on Monday, trading around $56,000 per coin. Today, Friday, Bitcoin and other digital coins continued their plunge, wiping over $260 billion off the value of the cryptocurrency market. Bitcoin was down nearly 10% in the last 24 hours at $49,281.40.
Dogecoin While, Dogecoin continued its surge. Last week Dogecoin, the cryptocurrency based on the “Doge” meme, became worth $40 billion as its price rose by a whopping 400% during the week. Created in 2013 by software engineers Billy Markus and Jackson Palmer, Dogecoin was intended to be used as a faster but fun alternative to Bitcoin. It has since found a growing community online supported by frequent tweets by Tesla CEO, Elon Musk.
Venmo hodls crypto…
The use of digital currencies in everyday commerce got increased support as Venmo announced it is adding support for cryptocurrency, which started on Tuesday. The company said it began to roll out the ability for Venmo’s more than 70 million users to buy, hold (hodl is a term derived from a misspelling of "hold" that refers to buy-and-hold strategies in the context of Bitcoin and other cryptocurrencies) and sell cryptocurrencies directly in the app, similar to the support Venmo parent company PayPal added late last year. Initially, Venmo will support four cryptocurrencies: Bitcoin, Ethereum, Litecoin, and Bitcoin Cash — the same that PayPal offers its US users. Though there isn’t much differentiation between what both PayPal and Venmo offer users today, the company explains that the move is more about getting cryptocurrencies in front of a separate, and arguably younger, audience. Also this week, Venmo’s parent company, PayPal announced plans to set up a local wallet in China focused on cross-border payments. In January, the US fintech company became the first foreign firm with 100% ownership of a payments platform in China. The company is looking to launch a domestic wallet. But instead of it competing with the dominant players Alipay and WeChat Pay for domestic payments, PayPal will focus on cross-border payments.
… as does WeWork 🏢
Also, on Tuesday, WeWork announced that it will begin accepting payment in selected cryptocurrencies in partnership with BitPay and Coinbase. Through BitPay, a cryptocurrency payment service provider, WeWork will accept Bitcoin, Ethereum, USD Coin, Paxos, and several other cryptocurrencies as payment. WeWork will also hold the currency on its balance sheet. The company will pay landlords and third-party partners in cryptocurrencies where applicable through Coinbase. In addition, Coinbase will be the first WeWork member to use cryptocurrency to pay for its WeWork membership
Central bank digital currencies 🏦
Continuing on the theme of digital currencies, The Bank of England and the Treasury announced on Monday that they are setting up a task force to explore the possibility of a central bank digital currency (CBDC). The aim of the task force is to look at the risks and opportunities in creating a new kind of digital money. No decision has been taken on whether to have such a currency in the UK. Issued by the Bank for use by households and businesses, the CBDC would exist alongside cash and bank deposits, rather than replacing them. The Bank has previously said it is interested in a CBDC because "this is a period of significant change in money and payments". The use of cash in financial transactions has been steadily declining in recent years, while debit card payments, as well as the use of credit cards and direct debits, have been on the rise. The Bank also sees having its own digital currency as a way of "avoiding the risks of new forms of private money creation", including cryptocurrencies such as Bitcoin. The Bank said, "If a CBDC were to be introduced, it would be denominated in pounds sterling, just like banknotes, so £10 of CBDC would always be worth the same as a £10 note."
In China, the development of a national digital currency began in 2014 when the People’s Bank of China set up an internal group to work on one. The move came shortly after Bitcoin gained attention in the country. The country’s central bank began testing eCNY last year in four cities, recently expanded those trials to bigger cities such as Beijing and Shanghai. People who were invited to the trial through a lottery on WeChat or other apps were able to click on a link and get a balance of 200 eCNY. To spend the money, users can use an eCNY app to scan a retailer’s QR code or produce a QR code that the retailer can scan. The design of eCNY borrows only a few minor technical elements from Bitcoin and does not use blockchain technology, which most cryptocurrencies rely on. Other countries are also quite long in their planning on a CBDC. For example, in Sweden, the central bank is proposing an e-krona. In April Sweden’s central bank announced that it will bring in banks in the coming year to test how the e-krona could handle commercial and retail payments in the real world.
Wall Street is also warming up to the idea of central bank digital currencies. But the Federal Reserve in the US likely remains a few years away from developing a CBDC of its own. A digital dollar would resemble cryptocurrencies such as Bitcoin or Ethereum in some limited respects but differ in important ways. The difference is mainly rather than be a tradable asset with wildly fluctuating prices and limited use, the CBDC would function more like the actual dollars and have widespread acceptance. It also would be fully regulated and under a central authority. Myriad questions remain before an institution as large as the Fed takes action. But the momentum is building worldwide. A 2020 survey from the Bank for International Settlements reported that nearly every central bank in the world has done some work on digital currencies. About 60% are working on “proof of concept”, though only 14% have actually launched a pilot program or are in development.
Facebook’s currency play 🤑
Already in 2019, Facebook wanted to revolutionize finance with a global digital currency, however, then came the regulators. Libra, the token was initially intended by Facebook to be a universal currency tied to a basket of sovereign currencies such as the US dollar and the euro. But after facing strong opposition from regulators worldwide, the organization overseeing the project lost major backers such as Visa and Mastercard. Now known as diem, the Facebook-backed digital coin is expected to launch later this year. The Diem Association, the Switzerland-based nonprofit which oversees diem’s development, is aiming to launch a pilot with a single stable coin pegged to the US dollar.
Zoom fund 💰
Last year when Zoom launched Zoom Apps and the Marketplace as a place to sell them, it was a big signal that the company wanted to be more than just a popular video-conferencing application. Instead, it wanted to be a platform, which developers could use to build applications on top of Zoom. This week the company announced a $100 million investment fund to encourage the most promising startups using the Zoom toolset to launch a business by giving them funding. Speaking of Zoom, Class, an edtech startup that integrates exclusively with Zoom to make remote teaching simpler, raised $12.25 million in new financing. The investors include Salesforce Ventures, Sound Ventures, and Super Bowl champion, Tom Brady.
Game goes on 🎮
Remember the GameStop frenzy? Well, on Monday the brick-and-mortar video game retailer rallied again after the company announced its succession plan as it seeks to pivot to e-commerce following the historic Reddit-fueled short squeeze earlier this year. Shares of GameStop jumped more than 8% to around $167 in morning trading on Monday. The Chief Executive Officer George Sherman will be stepping down on July 31 or earlier upon the appointment of a successor. While GameStop shares have come down from its record high of $483 in January, the stock is still up a whopping 720% for 2021. To take advantage of the massive rally, GameStop announced a $1 billion stock sale at the beginning of April to accelerate its e-commerce transition led by activist investor and board member Ryan Cohen. GameStop also hired former Amazon and Google executive Jenna Owens as its new chief operating officer. Still, Wall Street analysts’ consensus is that GameStop’s stock price is significantly detached from fundamentals. For example, Tesley maintained its underperform rating and a 12-month price target of just $30.
Clubhouse’s funding and Clubhouse clones🎙
As rumored last week, the audio-chat app Clubhouse closed a new Series C round of financing, the company said during its weekly town hall on Sunday. The new financing valued the company at $4 billion. The new round was led by Andrew Chen of venture capital firm Andreessen Horowitz with major investors like DST Global, Tiger Global, and Elad Gil.
It feels like each week there are at least a couple of Clubhouse clones popping up. This week they include:
Reddit On the heels of Clubhouse’s latest fundraise, Reddit officially unveiled its Clubhouse rival, Reddit Talk. Like many of the newly launched Clubhouse clones, Reddit’s voice chat experience does not deviate much from Clubhouse’s overall design. In Reddit’s case, however, it’s repurposed the format for its own communities, known as subreddits. Initially, Reddit Talk will live within subreddits, the individual forums focused on a given topic or theme. As the audio feature is being tested the community’s moderators will be the only ones able to start a talk. While the overall style is very much Clubhouse-like, Reddit has added its own touches. For example, users can react to speakers using a different set of emojis.
Facebook CEO Mark Zuckerberg on Monday announced that the company is building audio features where users can engage in real-time conversations with others, very much similar to the Clubhouse. In a blog post, Facebook said that the new feature is called Live Audio Rooms, and the company expects it will be available to everyone on the Facebook app and Messenger this summer. The company will start to test Live Audio Rooms within groups on Facebook.
Netflix and report 🎬
Netflix shares fell as much as 11% in after-hours trading on Tuesday after reporting a large miss in subscriber numbers in its first-quarter earnings report. Further, the company said it only expects to add about 1 million subscribers in the current quarter.
The key numbers from Netflix’s first-quarter report:
Earnings per share (EPS): $3.75, vs $2.97 expected
Revenue: $7.16 billion, vs $7.13 billion expected
Global paid net subscriber additions: 3.98 million vs 6.2 million expected
Netflix said the slowdown in subscriber numbers could be blamed on the pandemic, which forced the company to delay some of its big-name shows and films. Netflix has continued to hold itself against competitors including Disney’s Disney+, HBO Max, Apple TV+, Amazon Prime. In its report, the company said that it does not believe competition played a factor in the weak subscriber numbers. Despite the slid in Netflix’s stock consider how much it has gained in the past decade: a $1,000 investment in Netflix on April 20, 2011, would be worth $15,252 as of Tuesday, which corresponds to a gain of 1,425%. In 2011, Netflix had a market cap of $13.4 billion. Today, it’s $243.4 billion which makes its market cap bigger than that of Twitter, Snap, and Spotify combined.
$PATH 🔔
On Wednesday, software vendor, UiPath went public and saw its shares rise 23%. The company, whose software helps businesses automate repetitive tasks, had a market value of $34 billion at the opening. UiPath’s shares closed at $69 for the day. The stock is trading on the New York Stock Exchange under the ticker symbol “PATH.” UiPath was founded in 2005 in Romania by Daniel Dines, a former Microsoft engineer. Dines moved UiPath to the US about a decade later and established a headquarters in New York. Some one-quarter of the company’s 2,863 full-time employees are based in Bucharest, Romania. UiPath is going public at a time of rapid growth, as businesses from health care to energy producers look for ways to automate operations in their finance, human resources, and legal departments. The company’s revenue surged 81% last year to $607.6 million, and the company’s loss narrowed to $92.4 million from $519.9 million in 2019. UiPath’s gross margin of 89% is among the highest in software.
Remember SPACs? 📉
SPACs, remember those? It seems that the SPAC mania has come to a screeching halt. Just last month, special purpose acquisition companies or SPACs celebrated an unprecedented milestone by breaking their 2020 issuance record in just three months. After over 100 new deals in March alone, issuance is nearly at a standstill with just 10 SPACs in April. The drastic slowdown came after the Securities and Exchange Commission (SEC) issued accounting guidance that would classify SPAC warrants as liabilities instead of equity instruments. If it becomes law, deals in the pipeline, as well as existing SPACs, would have to go back and recalculate their financials in 10-Ks and 10-Qs for the value of warrants each quarter. SPACs raise capital in an initial public offering and use the cash to merge with a private company and take it public, usually within two years. Warrants are a deal sweetener that offers early investors more compensation for their cash. This potential accounting rule change could be a huge blow to the SPAC market as it could take away the incentives for sponsors and operating companies to opt for this alternative to a traditional IPO. Some of the incentives include a low level of scrutiny and the ability to move quickly. Meanwhile, restating financials could further dent investor confidence in a market that’s already highly volatile and oftentimes viewed as speculative. Amid the regulatory hit, many SPAC stocks are in a freefall. As of Tuesday’s close, CNBC’s SPAC Post Deal Index, which is comprised of the largest SPACs that have announced a target or those that have already completed a SPAC merger within the last two years, has wiped out its 2021 gains and fallen more than 20% year-to-date.
This week in the stock market 🎢
This week has seen the major averages fall. Staring on Monday, the stock market was dragged down by overall weakness in the technology sector. The Dow fell more than 120 points, dragged down by a more than 1.5% drop in Intel’s stock. The S&P 500 dropped more than 0.5%. The Nasdaq Composite was the relative underperformer, falling nearly 1% as Facebook, Amazon, and Microsoft all closed lower. Tesla dipped more than 3% as Bitcoin (mentioned above) which makes up some of Tesla’s balance sheet tanked during last weekend. On Tuesday, Wall Street continued to suffer back-to-back losses amid renewed concerns about rising new Covid cases globally. The Dow fell 250 points for its worst daily performance since March 23, while the S&P 500 and the Nasdaq slid 0.7% and 0.9%, respectively. United Airlines plunged 8.5% on Tuesday after the carrier reported its fifth consecutive quarterly loss. It also said that business and international travel is still far from a recovery. The Cboe Volatility Index, aka VIX, or the market’s fear gauge, rose for two consecutive days, landing above 18 after hitting a 14-month low last week. After three days of decline Stocks rose on Wednesday during regular trading hours. The Dow increased 316 points, or 0.93%, while the S&P 500 rose 0.93%. Nasdaq was the relative outperformer of the major indices, rallying 1.19%. On Thursday came reports that President Biden is planning a capital gains tax hike to as high as 43.4% for wealthy Americans. The proposal would hike the capital gains rate to 39.6% for those earning $1 million or more, up from 20% currently. The Dow Jones Industrial Average dropped more than 300 points by the end of regular trading. The S&P 500 erased earlier gains and closed down 0.9% lower. Nasdaq also fell 0.9%. Week to date, the S&P 500, Dow, and Nasdaq are down 1.2%, 1.1%, and 1.6%, respectively.
Woman of the Week
Cristina Junqueira
Cristina Junqueira is the co-founder of Nubank and since April this year she also took over the role of CEO of the company.
Junqueira was born in the former coffee capital of Riberão Preto and moved to Rio de Janeiro with her family in her early childhood. Cristina holds an Engineering Bachelor's degree and a Master's degree from Universidade de São Paulo, and an MBA from Northwestern University’s Kellogg School of Management. She started her career in strategic consulting at Boston Consulting Group, but after her MBA in the US she returned to Brazil a year later, at 24, years old she was immediately hired by the president of Unibanco, then the largest private banking group in the country. She was chosen to head the SME credit sector with a team of 20. The following year, Unibanco merged with Brazil’s second-largest private bank, Itaú. In 2012, Junqueira was appointed portfolio manager for the Itaúcard but left, disillusioned, when her proposals for commission-free credit cards and direct communication for clients were ignored.
“If we only have a small group of people who look alike and think alike creating the financial services of the future, it’s likely those products will only fit the needs of people similar to them.”
While contemplating her next step, she met David Vélez, who was working for the Silicon Valley-based venture capital firm, Sequoia Capital. Vélez was also increasingly frustrated by Brazil’s incompetent, over-charging banking system. He didn’t know the industry, but Junqueira did — and she shared his evaluation of it. They decided to give digital banking a shot. Her banking expertise was complemented by his experience in the world of venture capital and the technical know-how of third co-founder Edward Wible. As such, Nubank was founded in 2013. In an interview with Fortune, she told: “I worked for the largest incumbent bank in Brazil for five years and I was just done making rich people richer. I was trying to make a lot of changes to make consumers’ lives better and failing miserably at it. And at some point, I was like, ‘you know what? I’m done.” The founders chose the name Nubank for two reasons: firstly, “nu” sounds like “new”, but also because in Portuguese it means “nude” and they wanted to be a transparent organization. The first Nubank card transaction was made in Brazil on April 1, 2014.
“I want my daughters to grow up in a world where they can dream of being whoever they want to be — and you can’t dream of what you can’t see.”
Nubank’s series A financing round coincided with Cristina’s first pregnancy (she affectionately refers to her daughter Alice and Nubank as “twins”). In her seventh month, heavily pregnant, she traveled to California to meet prospective investors. The day before giving birth, she signed a deal from her hospital bed. Based in São Paulo, Nubank proved so disruptive that by 2018 it had easily achieved “unicorn” status with a valuation of over $10 billion, which makes it, in fact, the world’s first and only company with a female founder to reach a valuation above $10 billion. Today Nubank is the world’s largest digital banking startup with more than 25 million customers (across Mexico as well as Brazil). Inclusivity is important to Nubank, and the co-founders are justifiably proud of the fact that of the bank’s 2,600 employees, over 40% are women and 30% identify as LGBT.
Thank you so much for reading this week’s newsletter. I would love to hear your feedback and please share this with a few friends you think would find this interesting. Have a lovely weekend 💜
I’m Marianne, an early-stage VC based in Stockholm. You can reach me by replying to this email, or find me on Twitter or LinkedIn.