FinTech news in pipe category

Pipe, an alternative financing platform that was last privately valued by investors at $2 billion, has announced its new chief executive, an appointment that comes months after the company three co-founders stepped down from their posts in a stunning, unusual shake-up. After announcing the founding team would be leaving, allegations surfaced that Pipe made about $80 million in loans to a few crypto mining companies and that the loans were written off when one or more of these companies went out of business. He is also joining the board of directors, replacing Pipe former co-CEO Harry Hurst’s role as vice chairman. Josh Mangel, Pipe founder and co-CEO, temporarily assumed the role of chief executive back in November.

The startup declined to name its crypto mining-related customers, but notably, Pipe had a public partnership with Compass Mining, a now beleaguered crypto mining company that is reportedly facing its own fair share of struggles. Meanwhile, a Form-D signed by Pipe Senior Counsel Peter Chiaro with the U.S. Securities and Exchange Commission in late September reveals that the company recently secured $7.12 million in debt financing, which could be construed as a positive alternative to the kind of highly structured inside round that many startups are closing currently. Besides Fin Capital, other VCs to lead investments in Pipe on the part of their investment firms include Marlon Nichols, a managing director at MaC Venture Capital, and Ashton Newhall, a longtime investor with Greenspring Associates and now a partner with StepStone Group, which acquired Greenspring in September of last year. Other backers in the company include Morgan Stanley’s Counterpoint Global, CreditEase FinTech Investment Fund, 3L, Japan’s SBI Investment, Marc Benioff, Alexis Ohanian’s Seven Seven Six, Republic and Craft Ventures, which led the company’s $6 million seed funding in February 2020.

Crowdz, which secured $10 million in capital co-led by Citi and Dutch growth equity firm Global Cleantech Capital, said this year it expanded from providing invoice-based financing to SaaS-focused SMEs to also providing them with recurring revenue access to upfront capital they need without having to dilute their equity. With that buy — its first — Pipe created a new media and entertainment division called Pipe Entertainment with the aim of giving independent distributors the opportunity to trade their revenue streams in the same way a SaaS company could. The three co-founders of alternative financing startup Pipe are stepping down from their roles as executives of the company in one of the most dramatic management shake-ups seen in the fintech startup world in some time. Since its founding, the startup says that 22,000 companies have signed up for Pipe and $7 billion of ARR (annual recurring revenue) has been connected to the platform.

By purchasing Purely Capital, Pipe has now created a new media and entertainment division on its platform, giving independent distributors the opportunity to trade their revenue streams in the same way a SaaS company could.