This Week in Finance: Bye-bye Binance, Paper cashes in on tutoring and more big deals – Financial Post

A roundup of some of the biggest deals, financings and M&A headlines this week

Author of the article:

Stefanie Marotta

A trader works during the IPO for Chinese ride-hailing company Didi Global Inc on the New York Stock Exchange on Wednesday, June 30, 2021.
A trader works during the IPO for Chinese ride-hailing company Didi Global Inc on the New York Stock Exchange on Wednesday, June 30, 2021. Photo by Reuters/Brendan McDermid

CRYPTO

Binance exits amid greater regulatory scrutiny

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Another crypto company came into Canadian regulatory crosshairs this week as Binance, the world’s largest cryptocurrency exchange by volume, told users it would pull out of Ontario after regulators cracked down on the service.

In a release, the company told users late last week that Canada’s most populous province would now become a restricted jurisdiction following an investigation by the Ontario Securities Commission (OSC). The company further urged users to close out of their positions by Dec. 31.

The U.K. also shut its doors on Binance during the weekend as the Financial Conduct Authority in Britain stated that the company is “not permitted to undertake any regulated activity in the UK.” Earlier in the year, Germany’s finance watchdog, BaFin, put Binance on notice that it is risking a fine by trading digital tokens without publishing the necessary investor paperwork.

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Binance isn’t alone in this crypto crackdown: The OSC also issued non-compliance allegations against Asia-based Bybit Fintech, accusing it of operating an unregistered crypto trading platform within the province. San Francisco-based Poloniex and KuCoin, located in Seychelles, were two other exchanges hit with notices after the OSC warned in late March that crypto platforms had an April 19 deadline to contact the regulator with how they plan to bring their operations into compliance.

Amid these developments, Canada is walking a fine line between encouraging fintech innovation despite a lagging approach to open banking while keeping consumers safe from fraud and privacy risks that have been on the rise as Canadians increasingly rely on digital platforms.

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— Stephanie Hughes

TECHNOLOGY

Paper money: Montreal ed-tech startup cashes in on tutoring

Montréal-based education technology startup Paper Education Company Inc. raised US$100 million, its third funding round in 18 months. The round, led by Silicon Valley venture capital giant Institutional Venture Partners (IVP), boosts the company’s plan to scale its educational support software for elementary and secondary school students.

Paper provides one million students with access to 24/7 tutoring via instant messaging apps. As COVID-19 closed classrooms and forced many students and teachers to conduct lessons remotely, the startup saw interest in its services boom.

“Over the course of the last year, we’ve seen first-hand the stark inequality present in the public education system,” said IVP general partner Tom Loverro in a statement. “The stakes have never been higher for the many kids being left academically behind. It’s devastating to kids, their parents, their communities, and our nation’s future.”

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Paper contracts its services to school districts at a fixed price, and students gain access to on-demand support from multilingual tutors while teachers get virtual assistants that track progress.

“Tutoring, once reserved for the privileged few, is now broadly accessible, levelling the playing field across all students,” said Paper chief executive officer Philip Cutler in a statement.

As part of the deal, Loverro joins Paper’s board of directors. The round also included existing investors Framework Venture Partners, Bullpen Capital, Reach Capital, Birchmere Ventures, Salesforce Ventures, BDC Capital and ETW.

DEALS

Follow the money: A roundup of the biggest deals, financings and M&A headlines of the week:

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Vancouver’s Visier Inc. has joined the leagues of Canada’s unicorns with a US$125 million raise, bringing the startup closer to its goal of debuting on public markets. The business intelligence software company is the latest in a series of Canadian startups that have achieved a valuation of US$1 billion, joining the likes of Clio, Thinkific, Wealthsimple and Trulioo have reached the sought-after title in the past year.

Toronto-based Clearco launched a US$50 million fund to provide capital to celebrity-backed startups. The fund is in partnership with Caravan, a venture of an entertainment and sports company Creative Artists Agency.

Beijing-based ride-hailing company Didi Global Inc. raised US$4.4 billion in its public debut, pricing it at the top of its indicated range. It sold 317 million shares, more than the planned 288 million, at $14 a piece.

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Venture capital giant Andreessen Horowitz is launching a US$2.2 billion fund to invest in crypto networks. The move comes at a time when cryptocurrencies have gained the backing of top-tier companies including BNY Mellon, BlackRock Inc., Mastercard Inc. and Visa.

Visa Inc. is buying European open banking platform Tink for 1.8 billion euros. The payments technology company. In January, Visa and financial technology company Plaid terminated their US$5.3 billion merger due to antitrust concerns.

  1. “In the last 35 years, most organizations invested in customers, revenue, everything but people. Now, organizations have no choice but to talk about people.” says Visier Inc.'s cofounder Ryan Wong (not pictured).

    B.C. business intelligence startup Visier hits unicorn status with US$125 million raise

  2. Former U.S. vice president Al Gore is Generation Investment Management’s founding partner and chairperson.

    Al Gore’s investment firm leads $225 million investing round in Montreal’s Alayacare

  3. Mark Machin resigned as president and chief executive officer of the Canadian pension fund in February.

    Mark Machin joins Singapore investment firm after quitting CPPIB

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Dozens of companies that entered U.S. markets through deals with SPACs in the past year are about to graduated into the FTSE Russell 3000 index. The transition potentially boosts the fortunes of electric vehicle developers and other ventures.

BuzzFeed plans to go public via a merger with a SPAC. The 15-year-old digital media company is targeting a $1.5 billion valuation in its deal with 890 Fifth Avenue Partners.

Confluent, the data analytics vendor that spun out of LinkedIn in 2014, surged more than 22 per cent in its public markets debut on the Nasdaq. The company raised US$828 million, posting a market cap of more than US$11 billion.

Israeli payments provider Payoneer went public on the Nasdaq stock exchange via a merger with a SPAC backed by fintech entrepreneur Betsy Cohen.

— Stefanie Marotta

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