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Fintech fund Life.SREDA makes its first exit

0 26 February 2014

Spanish bank BBVA has acquired Simple, giving Russian fintech fund Life.SREDA its first exit. BBVA paid $117 million for the American innovative banking app, giving Life.SREDA a 180% return on the investment it made in June 2013. 

Simple, which was founded in summer 2012, helps clients to control their spending and to meet saving targets. Banking infrastructure is provided by Bancorp, which also offers back end and processing support. Last year the project processed $1.5 billion. 

BBVA Group’s purchase is part of a broader strategy to become more innovative. BBVA Compass in Texas recently installed a number of experimental drive-through atms featuring video-conferencing technology that allows clients to perform a wide range of banking functions without leaving their car. The bank plans to increase Simple’s audience outside of the US.

Life.SREDA’s fintech-oriented portfolio also includes Moven, an American mobile bank, Russian-Czech service Instabank and German innovative bank FIDOR, as well as Russian projects MyWishBoard and LifePay

Alexander Ivanov - CFO and partner at Life.SREDA

"This deal is extremely beneficial for both parties - Simple’s founders have received has considerable sum for themselves, and also now have the chance to take advantage of BBVA’s significant presence around the world. BBVA, with which our fund has always has a friendly relationship, has acquired one of the best teams in the world in the fintech sector. 

It’s interesting that the purchase valued the service at $1200 per user, compared to the $42 per user that Facebook paid for WhatsApp." 

Vladislav Solodki, Life.SREDA’s CEO reckons that soon more mobile banks will be acquired, instead of receiving investment in return for minority stakes. 

"We are now seeing how, on the one hand, there are a number of mobile banks on the market, and on the other are a number of major players who have realised that it is cheaper to buy a service that already works and integrate it into their system than to start from scratch. In Russia I think that these projects could interest mobile operators, who are actively considering how to offer their clients financial services but whose own developers are years behind mobile banks. For them it would be cheaper to buy a team than to work out a solution themselves."

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