What happened: Last week, two French fintech infrastructure providers announced big funding rounds. Formance announced its USD 21 million round(TechCrunch), and banking-as-a-service provider Swan followed quickly with its USD 44 million round extension (TechCrunch).
My comment: Formance is likely not (yet) a very well-known player in the broader fintech ecosystem, but it has gotten some good attention in the infrastructure space. At the core, Formance offers a ledger solution that helps companies record various money flows and everything that follows that - including reconciliation. By now, Formance describes its offering as a platform solution that can be connected to different payment providers (e.g. Stripe, Adyen, Mangopay) and the Formance infrastructure becomes the middle layer that does not only orchestrate these providers but also becomes the single source of truth for the companies using them. These include fintech companies (e.g., Liberis or Shares) and non-financial brands like appointment booking provider Doctolib or mobility provider Angkas.
On the other hand, Swan is likely a known provider for many of my subscribers. The French banking-as-a-service provider enables fintech and non-financial brands to offer card and/or payment account-related services. While many other banking-as-a-service providers struggle (see further below), Swan seems to be riding a strong wave. This round is declared an extension of their Series B from September 2023, bringing the total round to roughly USD 84 million. Please don’t ask me what the rules are until you can call a round an extension versus a new round, but let’s not split hairs. Swan is one of the few European banking-as-a-service providers that score deals and attention in several European markets (France, Spain, Netherlands and Germany) and, with the fresh money, might be going for more growth. We all know by now that banking-as-a-service providers should not go purely after neo-banks as customers but rather non-financial brands and industry-niche solution providers. So, you can argue that Swan benefits from a second-mover advantage, but its fundraising success still stands out compared to other second-generation providers.
What do you think? Is it a coincidence that the two infrastructure providers with these strong funding announcements this week are from France, or does this tell us something?
