Smartech Capital, an investment vehicle born in Barcelona, is successfully carrying out its first Exit.
For Square, the American fintech firm, it represents the first acquisition of a European startup.
The fintech sector is still in full swing. Square, the fintech company that specializes in mobile payments and other financial services based on digital media, has acquired the Spanish startup Verse.Verse is a fintech startup that allows you to pay and request money from friends instantly through a mobile application. Its main difference from other similar financial applications is its payment system using blockchain technology. The App eliminates all intermediaries during transactions and allows them to be carried out quickly, safely and without commissions. From the experience of Smartech Capital, the first time we met the Verse entrepreneurial team and, in particular, Oriol Tintore, CEO, former NASA and MBA from Stanford, we were left with the same feeling as when we met the founder and CEO of Glovo, Oscar Pierre. The feeling of being in front of a star entrepreneur, very young, but with unusual charisma and audacity. In the same way, we were impressed by Pablo Viguera, COO and until recently General Manager in Spain at Revolut. And “last but not least” the figure of Bernardo Hernández - who needs no further introduction - gave us the peace of mind that no matter what happened, there was a safety net. We could say that the team was the first thing that dazzled us and made us believe in the possibilities for growth. At that time, their metrics also looked very good. They grew almost organically at a monthly rate of 15% organically and they had not yet exploited acquisition channels such as Facebook Ads or Instagram Ads in an organized manner. It wasn't all good news, though. The company had been going through a difficult period, with a total change in its founding and executive team and having to return money from a previous round to the lead investor, with a high monthly burn rate for such a young startup, and without generating any revenues! Finally, we decided to join Verse because of its cutting-edge technology in a booming sector, the growth in organic users and above all its “stickiness”, its young and powerful entrepreneurial team and the co-investment in the round with a leading American Venture Capital such as Greycroft. We believe that the purchase of Verse by Square will brutally boost the company and will cause great stress to Bizum and other similar financial applications in Europe. Verse has more than one million users and in June 2019 it received a European payment license that allows it to operate throughout the European Economic Area. Verse's traction already stands out strongly in the neighboring countries of Spain; Italy, France and Portugal, where new users are constantly growing. Square has made it a priority to allow Verse to continue growing throughout Europe. The company will continue to operate as an independent company, working from its same offices and without very immediate changes to its existing products, users and business agreements. The union with Square will be through the Cash App, so that both teams can learn from each other while Square provides them with all the necessary technology and resources. Square is the fintech company of Jack Dorsey, CEO and founder of Twitter. Today, the financial company is worth 38.1 billion dollars on the stock exchange, more than Banco Santander or BBVA. Its shares registered $86.72 last Friday, the highest reached since September 2018. In short, the purchase of Verse shows Square's ambition to expand to other geographies. So far it has managed to offer its services in the US, the United Kingdom, Canada, Australia and Japan, so the expansion into Europe could be a good move to overthrow its great rival, PayPal, a company that is already established in more than 200 countries.
More about Smartech Capital
Smartech is an investment vehicle born in Barcelona by 6 professionals with a cumulative experience of +50 years in Entrepreneurship, Venture Capital and Corporate Finance. The main objective of Smartech is to energize the entrepreneurial ecosystem in Southern Europe and to participate in disruptive projects with a global approach, capable of generating significant returns both to society and to the investors themselves. Smartech always co-invests with the most relevant VCs, not only in Spain but in other more mature markets such as the United Kingdom, France or The Smartech model consists of carefully selecting its Limited Partners, incorporating successful entrepreneurs and professionals with an outstanding track record (consumer goods, consulting, banking, retail, etc.). The coexistence of such valuable profiles, together with their diversity, gives Smartech unique possibilities to support entrepreneurs in the entrepreneurial ecosystem.Intelectium Advisory supports Smartech in the identification and analysis of dealflow for the investment vehicle. In addition, Patrick Hunt, Managing Partner of Intelectium, is one of the 6 General Partners of Smartech Capital and actively participates in committees and investment decisions. Smartech Capital, since its two years of operation, has already invested in more than 12 startups, including some such as Colvin, Exoticca, Stayforlong, Verse, Kompyte, Psious, Science Bits, Quality Clouds and Billin. From the vehicle, they are still looking for interesting investment opportunities.
