Canadian Fintech: Why Moneris Sold 💳

Good morning! Welcome back to the Canadian Fintech Newsletter, an industry roundup for founders, operators and investors.

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💰 Funding

• Brdg (Montreal) raised $850k in pre-seed funding led by Forum Venture (US)..

  • They automates construction financing and loan draws, similar to Built in the US.

• Fisent Technologies (Toronto) raised a $6m Series A led by FINTOP (US).

  • They AI to automate bank workflows.

  • Pegasystems (US), a much larger competitor, also invested.

• Air Canada raised 25% stake in Aeroplan for $2.5b to investors led by Blackstone & La Caisse, valuing the loyalty program at $10b.

  • Although this deal was marketed as equity, it’s actually structured as a loan.

🤝 M&A

• RBC & BMO agreed to sell Moneris (Toronto) to US private equity firm Francisco Partners for $2b.

  • The banks launched Moneris in 2000 to share tech costs and build national scale. It worked - today they process about 1/3 of Canadian transactions.

  • But as payments became more competitive and tech-intensive, the Big 5 moved away from running merchant processing themselves: TD sold to Fiserv, while CIBC and Scotiabank outsourced to Global Payments and JPMorgan.

• Wilson M. Beck (Vancouver), a 45-year-old commercial insurance brokerage, was acquired by Gallagher.

  • Earlier this month Gallagher also rolled up insurance broker / MGA APOLLO (Vancouver).

A MESSAGE FROM FLINKS

✨ He lent his own money on Craigslist at 16. Then built ZayZoon.

Tate Hackert co-founded ZayZoon, one of Canada’s earned wage access pioneers.

In this episode, he talks about the early, hands-on decisions that built trust with customers from zero, what it took to earn financial institutions’ trust from scratch, and the pride of building something distinctly Canadian.

Watch Episode 02 of Built Here →

🚀 Product

• Atomic entered Canada by signing up TD.

  • Atomic lets bank customers update their payroll direct deposit entirely inside its app

  • Fun fact: Atomic competitor Knot, who also recently entered Canada, is suing Atomic for stealing trade secrets discovered in a “honeypot trap” - who says fintech is boring!

• Magical Credit (Toronto) expanded into short-term consumer lending and small-business lending through new brands Magical Cash and Magical Business.

• Shakepay (Montreal) launched a line of credit that lets customers borrow against Bitcoin held on its platform without selling it.

🧍 People

• Evan Siddall, former CMHC CEO was named chair of Build Canada Homes, the new federal housing Crown Corp.

• Rick Hillier, a retired Canadian Forces general joined National Bank as an adviser as it expands into defence financing.

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Have a great week! See ya 👋

-Tal Schwartz