Huge $170m Raise By Branch

Some awesome news coming out of the fintech scene yesterday as Branch raised $170 million from some top tier venture capital firms. I met Matt Flannery 8 years ago when I was at the GSBI incubator in Silicon Valley. He’s a crazy impressive person and I’m really glad he’s had a second success now with Branch.

This raise also validates the digital lending space. $170 million is a massive amount of money to continue improving their product and expanding into new countries. The big push by all digital lenders now is into new markets. India, South East Asia, and Latin America are all largely untapped. Branch is riding the wave of smartphone adoption in these countries, and delivering a bunch of value to users who allow Branch access to their user data. It’s really exciting to see, and I’m interested to see how Branch localizes their product in these different markets.

The tie in with Visa could also be a game changer. Branch gets access to a massive network of ATMs that support Visa supported cards. Visa gets access to lots of new merchants that currently use Branch loans, as well as a new acquisition tool in the form of offering loans to SMEs that haven’t adopted Visa yet. Flannery says:

We started Branch in Kenya, where M-Pesa gives anyone with a phone – including the unbanked – access to digital credit. Unfortunately, mobile money isn’t available in most countries. With the help of Visa, now we can send cash to any ATM and reach the underserved around the planet.”

Branch gets distribution and Visa gets acquisition. This looks like a win-win partnership to me, even more so than the Mastercard-Jumia deal I wrote about previously. I’m excited to follow this one.