There are two types of fintech companies. Those that want to attack a particular segment of the bank. And those that want to become banks.
This is the case of Neo, a start-up created in 2017 in Barcelona by six Europeans, including two French. “Neo’s vocation is to digitalize CIB (corporate and investment banking),” summarizes Laurent Descout, Neo’s CEO.
Before getting there, the start-up first tackled international payment
At the beginning of 2019, it launched a multi-asset solution (spot exchange, forward exchange, currency options, etc.) to hedge exchange risk on more than 90 currencies at “lower rates than banks”, the manager asserts.
Among other things, the platform offers advanced control and reporting functionalities. Also, it offers a mapping of the user’s currency risk, enabling him/her to receive a customized hedging program. To manage this activity, the Neo team created a structure called Neo Capital Markets SV SA. The structure obtained the status of investment services provider (ISP) in 2018 in Spain, and has taken it to several European countries including France.
This approval allows it to provide investment advice (in this case, the currency hedging strategy). And also to provide the client with the investor guarantee fund (an organization whose mission is to protect bank clients in the event of a failure of their banking institution). This also allows automated management by order. “In the long term, it is also the possibility of extending our offer on the interest rate and/or commodity hedges,” underlines Laurent Descout.
On the business model side, Neo invoices basic modules and modules for very exotic currencies. But doesn’t give any more indications. However, Laurent Descout points out that the commission is “always transparent and given to the client before the transaction”. Please note that there is no minimum commission.
Neo will soon open an office in France
Neo claims around thirty customers from all sectors (technologies, publishing, etc.) and aims to reach 200 by the end of 2020 in the French, Spanish, Polish and Benelux markets. A deliberately low number to “test the functionalities with them”, says the co-founder.
For the moment, the start-up does not have any French customers but a few prospects. It plans to open an office in France with around ten people in 2020 (sales, support and compliance functions) and has just recruited two sales managers for France. Today, Neo has 25 employees spread between Barcelona and Cambridge (where the developers are). 60% of the staff is dedicated to IT. The company plans to hire about thirty new people (including ten in France) in 2020.
The young shooter has another big project in the boxes
By the first half of 2020, Neo will offer a multi-currency account, similar to the Franco-Belgian iBanFirst offer. This solution, which will be available in Spain, France, the United Kingdom and Poland, will allow payment and collection in 30 currencies. Later on, decision support tools will follow. Once launched, the multi-currency account will cost 100 euros per month for an unlimited number of users.
The multi-currency account depends on another structure: Neo Fintech Lab SL. The latter has held a payment institution license in Spain since last July and will be issued a passport shortly. This two-headed model is explained by regulatory reasons. “We have seen a dozen regulators propose a hybrid structure, both a payment company and an investment services provider, but we have not been able to do so due to legal issues. So we created two companies but unified the services. When you are a Get Neo customer, you are a customer of both companies as if they were the same service provider,” explains Laurent Descout.
Neo’s fundraising campaign
All solutions will be accessible via a single platform, named Get Neo, although they depend on two different companies that belong to the Neo group.
To develop its two solutions, Neo can rely on its €5 million fundraising campaign carried out at the end of 2016 with business angels and personalities in the sector. This first round of funding corresponded to the entry ticket for PIS status (€730,000 and the viability of the funds over the next three years).
The next exercise will only be carried out once the customer target has been reached at the end of 2020. In the meantime, the Neo team is working on new features and solutions that will allow it to be the “single entry point” for companies.
First published in Le Journal Du Net, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
The TopRanked.io Weekly Digest: What’s Hot in Affiliate Marketing [++ KuCoin Affiliate Program Review]
This week, we answer the two questions on everyone’s lips — What do SJWs and e/accs have in common? And...
BIPV Boom: By 2032, Building Integrated Photovoltaics Will Be Worth Over $143B
The next moves by the European Commission and the trend toward a real estate stock composed of Zero Emission Buildings...
French Fintech Company Qonto Launches SME Financing in Italy
Qonto is expanding its financial solutions for SMEs and professionals in Europe, launching the option for companies in Italy to...
Trusters and Leone Investments Finally Receive Approval Under EU Regulation
After almost a month under the new EU Regulation, two platforms, including the historic Trusters launched in 2018 and the...
Coinbase Wallet Has a New Feature: Send Crypto via Web Link
The exciting part is actually in the small print: This is because Coinbase covers the fees for transactions via stablecoin...
Impact Investing1 week ago
Hi-Tech Buoy to Clean Up the Seas Created by Jelter
Crypto1 day ago
LUNC Capitalization Exceeds $1 billion – How High Will the Price Go?
Biotech2 weeks ago
Novo Nordisk Invests €2.1 Billion in Its French Plant
Crowdfunding1 week ago
Recrowd, Real Estate Lending Platform, Finally Gets European Authorization