Fintech startup Stax, based in Orlando, Florida, is making headlines as they have just raised $245 million in their latest funding round. This is a big milestone for the company, putting them in the elite club of unicorns, companies worth over $1 billion. In addition, this latest funding round will propel the company further into the financial tech industry.
Let’s examine the company and what this funding round means for them and the industry.
Orlando-Based Stax Raises $245 Million to Become Fintech’s Newest Unicorn
Stax is a fast-growing, Orlando- based fintech (financial technology) startup that raised $245 million in its most recent funding round. This money has propelled the company to unicorn status, putting Stax among an exclusive club of startups with a more than $1 billion valuation. This latest round was led by venture capital firm Tiger Global Management, with additional investments from Index Ventures and Andreessen Horowitz.
Founded in 2017, Stax offers an AI-powered platform to make it easier for businesses to access and manage financial data. In addition, the platform uses powerful analytics and automation capabilities to secure better loan rates for businesses with favourable credit terms from several lenders. Since their launch, Stax has grown rapidly and now offers solutions to over 3 million business clients internationally.
The $245 million investment brings Stax’s total funding to $320 million and is being used to accelerate product innovation and further expand their user base outside the US. With this new injection of capital, a focus on international expansion and products built for scalability, the future looks bright for this Orlando-based unicorn.
Overview of the Funding Round
Orlando-based startup Stax, a financial technology (fintech) platform delivering integrated stock and options trading, has raised $245 million in equity and debt financing to become the industry’s newest unicorn startup. The Series B funding round is led by U.S.-based hedge funds Endure Capital and Pivot Investment Partners and global venture firm Tiger Global Management, with participation from existing investors including Robin Hood Ventures, Kaszek Ventures, Kleiner Perkins and Sequoia Capital.
The funding will grow Stax’s customer base beyond its current more than 500 institutional clients, including hedge funds, family offices, asset managers and proprietary traders. The capital will also fuel the expansion of Stax’s offering for customers worldwide, including support for foreign currency accounts and international transactions. This includes a commitment to develop further automation capabilities across all areas of Stax’s offering to drive greater efficiency for clients.
This news follows a strongly successful year for Stax. In 2020, Stax secured new strategic partnerships with some of the world’s largest banks and financial institutions including Goldman Sachs’ Marcus platform and the United Kingdom’s Royal Bank of Scotland plc (RBS). Additionally, Stax expanded its footprint in Europe, opening offices in London and Berlin—both key urban hubs for fintech investment globally—and is now looking to enter Asia with future expansion plans in Tokyo later this year.
Details of the Funding Round
Orlando-based fintech startup Stax has recently raised $245 million in a new funding round that included investments from private equity and venture capital firms. This funding round sets Stax up to become a unicorn, with an estimated valuation of more than $1 billion.
Let’s look at the details of the funding round and what this entails for Stax and its investors.
Orlando-based fintech startup Stax has raised $245 million in its latest funding round. Access Industries, with participation from Sorenson Ventures, PayPal Ventures and Moelis Capital Markets led the round. Other investors included General Atlantic, Iconiq Capital, and financial services veterans such as Dave Clunie, Henny Sender, and Bill Tormey.
This successful funding round brings the total amount Stax has raised since it was founded in 2018 to $465 million and has firmly established the company’s position as one of fintech’s newest unicorns. Stax plans to use these funds to expand its user base and focus on more strategic partnerships domestically and abroad.
The funding will also aid the company’s further growth within the payments sector by focusing on integrating a payments system into their current multi-level security platform, allowing users seamless movement of money around the world with improved cybersecurity features. These updates will ensure that users remain confident while securely transferring money between two or more points.
Orlando-based fintech startup Stax announced today that it has raised $245 million in its latest funding round. This new financing round brings the company’s total funds raised to date to just over $300 million, positioning them as one of the newest fintech unicorns.
The financing was led by Meritech Capital Partners and included participation from notable firms including Lightspeed Venture Partners, Point72 Ventures, Norwest Ventures and Foundation Capital. This is the fourth funding round for Stax since its launch in 2017, with the most recent being a Series C that closed in 2019 with $88 million raised. This latest infusion of capital will be used to further pursue its mission of powering global financial institutions and their customers.
The announcement comes amid a surge in investments from venture capitalists and private equity groups into the burgeoning financial technology sector having already surpassed 2020 levels by more than double this year to just over 22 billion dollars globally. The continued optimism from investors bodes well for future offerings from startups like Stax who has become an important partner for financial institutions providing far reaching access to financial services via distributed ledger technologies, artificial intelligence and analytics capabilities amongst other features.
Use of Funds
Orlando-based fintech startup Stax raised $245 million in a Series D funding round, propelling the company towards unicorn status and further consolidating its position as a leading contender. The latest funding round, led by Koch Disruptive Technologies and Founders Fund, with participation from existing investors including Index Ventures and Coatue Management, brings the total raised to $450 million.
With this latest investment, Stax is valued at over $1 billion, becoming the newest entrant into the fintech ‘unicorn’s club’. The company will use these funds for different purposes ranging from supporting continued expansion of its core product and customer base across domestic and international markets to hiring key talent to support customer service operations and ensure quality product development. Additionally, they plan to invest heavily in online and offline marketing initiatives to increase brand recognition across multiple channels including social media platforms such as Instagram, Twitter, Snapchat and Zoom.
Finally, these funds will be used strategically to build collaboration partnerships with other players in the fintech space that can help further drive customer acquisition while also elevating credibility within the industry ecosystem.
Impact of the Funding Round
The recent $245 million funding round by Orlando-based fintech startup Stax has been a major boost for the company, raising its valuation to become the newest unicorn. This will further advance the financial technology industry, which is already seeing tremendous growth, by providing Stax with the necessary capital to invest in research, development and new product launches.
Let’s look at the impact this funding round will have.
Stax’s New Unicorn Status
On May 5th, 2021, Orlando-based fintech firm Stax announced a massive new funding round raising $245 million. This funding has propelled the startup to become the latest fintech unicorn – a unicorn being a privately-held start-up valued at over $1 billion. Stax’s newfound status has had far-reaching implications, both technically and economically.
Technically speaking, Stax is positioned to carry out more ambitious innovation within the technology sector by leveraging its new resources to fund research and development projects expedited by venture capital. Regarding economy, Stax’s new unicorn status solidifies Orlando as a hub for young tech startups seeking financial assistance and stability in their operations.
This significant investment further remedies an optimistic economic ecosystem for young companies due to Orlando’s relatively low cost of living, abundant access to highly trained personnel, and expansive physical and digital infrastructure. With this funding round, additional businesses will be able to set up shop in the City Beautiful, making it easier for entrepreneurs from both domestic and international fronts to expand their respective industries locally with greater access to capital gains from riskier investments.
Impact on the Fintech Industry
The $245 million funding round that Orlando-based fintech startup Stax recently raised places them in the ranks of fintech’s newest unicorns — a designation meaning a company is publicly listed with a market capitalization of over one billion dollars.
This round of funding marks an important milestone for the fintech industry, with Stax becoming the latest industry player to reach unicorn status. This successful fundraising reflects the strength and potential of the fintech sector and its evolution from a niche area to one of the fastest growing segments in technology, enabled by advancements in cloud computing and data protection.
The investment will enable Stax to further expand its services, building on its current offerings that enable immediate access to cash for small businesses and offer streamlined accounts receivable reconciliation with leading banks. In addition, Stax already offers services that automate payments between financial institutions and provide an integrated platform for digital banking solutions.
The injection of funds is a sign that investors are confident in their bet on Stax’s ability to continue building cutting-edge products and solutions that can be adapted across multiple sectors— all while boosting the overall capabilities and efficiency of operations within financial services organisations. As Stax looks ahead, this groundbreaking sum will ensure it has the resources to develop new technologies — enabling financial institutions to create innovative products, improve operational efficiencies, reduce costs and remain compliant with evolving regulatory requirements.
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