Acquisitions of Doorr and Paysley signs of consolidation?

By Robin Amlot

In its recent update on the outlook for European FinTechs, Finch Capital identified the consolidation of fragmented players as one of the key themes for 2021. This is something that will not be limited to Europe. Indeed, there has been news of a couple of acquisitions in Canada and the US, of Doorr and Paysley. Finastra, via its Canadian mortgage business Filogix, has acquired Doorr, a provider of cloud-based point-of-sale mortgage application software used by brokers to improve the mortgage experience. The deal is part of Finastra’s strategic investment in its Filogix mortgage marketplace. And in the US, PaymentCloud has acquired contactless payments technology newcomer, Paysley. Announcing the deal, a statement from PaymentCloud said: “After an extended courtship, PaymentCloud has acquired the majority share of the contactless technology startup Paysley…”

Siobhan Byron, SVP, Technology Enabled Managed Services (TEMS) at Finastra said, “Filogix has always been the go-to provider of tools and technology for mortgage originators in Canada. The addition of Doorr will bring cutting edge features backed by the talented individuals that join us from the company. Combined with our deep expertise and leading position in the Canadian brokered mortgage market – together we can improve the borrowing experience for consumers, brokers and lenders.”

One is really not quite sure what to make of PaymentCloud’s ‘an extended courtship’, presumably a polite disagreement over terms. We don’t know, as the financial terms of the deal were not disclosed and neither were the terms of the Filogix purchase of Doorr. Are they the beginning of a consolidation in the FinTech sector or not?

“The future of payments is already shifting toward contactless means and now, with the acquisition of Paysley, we will be at the forefront of this shift. I’m eager to bring this innovative solution to fruition at such a pivotal time,” said PaymentCloud CEO Shawn Silver.

While it may be difficult to judge the outlook for consolidation from just these two straws in the takeover wind and even more difficult to gauge the financial significance given the lack of data, you may be assured that larger firms looking to plug in attractive add-ons at the right price are definitely on the prowl.

However, that does not mean that the startup arena is dead. It may just be a little quieter but on the same day as these two deals were announced, came the news of a successful seed funding round by Silverflow, a cloud-native card payments platform that connects directly to card networks. The €2.6m seed funding round, was led by UK-based seed-stage investor Crane Venture Partners with participation from INKEF Capital and notable angel investors and industry leaders from Pay.On, First Data, Booking.com and Adyen. With this seed round, Silverflow has now raised €3m in total funding.

Krishna Visvanathan, Partner at Crane Venture Partners, added, “Our mission at Crane is to back entrepreneurs who are redefining the enterprise technology stack and Silverflow epitomises this as it relates to global card processing. Whilst payments power the digital economy, existing backend processing technology is old, costly and inflexible – and ripe for reinvention. Silverflow’s founders are a powerhouse team of payments industry experts with a unique insight to building a product that transitions PSPs, acquirers, and merchants from inflexible legacy systems to a fully cloud-native modern architecture.”