Canadian Fintech: Neighbourhood Buys Fisgard 🏠

Good morning!

Welcome back to the Canadian Fintech Newsletter, an industry roundup for founders, operators and investors. Every Monday we break down the hottest topics in the industry in under 3 minutes.

Later this morning I’ll be interviewing the new CEO of EQ Bank at the Canadian Lenders Summit.

The following week I’ll be speaking in Vegas at Money2020. Let me know if you’re going and want to meet up! If you still need to buy a ticket, I can send you a USD $950 discount code.

As always, if you’re a paid subscriber to this newsletter, you also get access to the Canadian Fintech Database - a detailed list of every fintech acquisition in Canada.

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💰 Funding

• Nesto, a Montreal based online mortgage lender is investing in Maple Financial, a Toronto based alternative mortgage lender via their subsidiary CMLS.

  • Nesto has $70b in AUM and acquired CMLS last year.

• Brokerbot, a marketing automation tool for mortgage brokers and lenders raised an undisclosed seed round from Carriage House Wealth, a multi family office.

  • They compete with Vancouver based Ownwell, who also raised their seed this year from Conconi Growth Partners.

• Provision, a Toronto based tool for estimating construction project costs raised $10m from Cercano Management & YC.

🤝 M&A

• Neighbourhood Holdings acquired Fisgard Asset Management, making them one of the larger private alternative mortgage lenders in Canada at ~$750m AUM.

  • Both firms are BC based and serve non-prime borrowers via brokers.

  • The scale of the newco will give them access to lower cost of capital and securitization potential.

  • It also diversifies their investor bases (Fisgard skewed more retail and Neighbourhood is more institutional) and broker networks.

• Canaccord Genuity is looking to sell its UK wealth division for around £1b.

  • Canaccord acquired two two asset managers in the UK and an advisory firm in Australia in the last year.

🚀 Product

• Affirm is picking up major Canadian clients:

  • Clio, a Vancouver based law firm backoffice software, launched Clio Capital to let law firm clients pay fees over time.

  • Freshbooks, a Toronto based accounting platform will let customers offer BNPL on invoices.

  • Shopify expanded their BNPL offering to Canadian merchants in the Spring.

• EZO, a Montreal based consumer payments and crypto exchange formally launched.

  • EZO has processed $40m in transaction volume and raised $3m in funding.

• Alexi, a Toronto based legal AI tool is nearly at $10m ARR.

• D1g1t, a Toronto based analytics platform and Mako, a Montreal based KYC tool are launching a joint offering for wealth advisors.

• BMO is selling off 138 Midwestern US branches to refocus on California.

• Scotia is cutting jobs across its Canadian banking teams.

⚖️ Policy

• Rumours are swirling that open banking and stablecoins will feature prominently in the Nov 4th Federal Budget.

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Have a great week! See ya 👋

-Tal Schwartz