Explore the 2020 Fintech Sector

White Star Capital
Sector Overview:
Fintech
From the eyes of an
international investor
H1 2020
1

White Star CapitalWhite Star Capital
Contents
2
Section 1 Fintech Ecosystem: An Overview
Section 2 Sector Focus
Personal Finance
Insurance
Financing & Lending
Business Operations Tools
Payments
Finance-as-a-Service
Regtech
Section 3 Geographic Outlook
US
Canada
Europe
Japan & South East Asia
Section 4 Partnering with White Star Capital
4
13
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59

White Star Capital
The 2nd Wave of Fintech
3
Source: Pitchbook
788 Deals
$8bn
Invested in
Asia in 2019
911 Deals
$7bn
Invested in
Europe in
2019
1,407 Deals
$19bn
Invested in
North America
in 2019
Since its founding, White Star Capital has been investing into entrepreneurs
pioneering change in both the consumer experience and supporting
infrastructure of fintech, throughout North America, Europe and Southeast Asia.
The unbundling of banks has been the most defining trend of fintech over the last
decade. New customer centric entrants have emerged, determined to improve the
user experience, transparency and value-for-money, mainly focusing on single
product offerings. Large financial institutions have found themselves needing to
innovate to compete. Globally, from money transfer to banking, lending to
payments, insurance to financial business tools, fintechs have taken in over $180bn
of venture capital funding, across almost 23,000 deals over the last 20 years, with
several unicorns and decacorns being born as a result.
Fintech is now an established and highly sought after sector, and as we enter into a
new decade, we believe we are now witnessing the second wave of Fintech
innovation, led by 2 mega trends:
1) The development of core banking infrastructure and enabling technologies,
allowing both incumbent financial service providers to reimagine their back-ends
and non-financial companies to deploy financial products to supplement their
offerings
2) The increased specialisation of financial and insurance offerings to their target
group’s needs, with single product players rapidly expanding their offering to
cater for all needs allowing them to diversify their revenue streams and
increase their share of wallet
There are still many problems to be solved and untapped opportunities, particularly
around the distribution of products and services, a shifting customer need with
ageing populations and the ability to strike the right balance between innovation
and consumer protection.

Fintech Ecosystem: An
Overview

2019 Fintech Highlights
5
Source: Pitchbook
(1) Rounds >$100m.
(2) CIFTI50 as of 31-Mar-2020.
Fintech Ecosystem: An Overview
$104bn
Fintech funding over the
last 3 years
14%
Share of VC funding
invested in Fintech over
the last 3 years globally
58
VC-backed fintech
unicorns
12%
Share of seed funding
invested in Fintech over
the last 3 years globally
192
Fintech IPOs over the
last 10 years
200+
Mega rounds in total1
+64%
Share price performance of the top 50 public
fintech companies since 20162

318 452 656
923 1,070 1,144
1,575
1,298 1,407
226
108
177
298
501
634
814
1,020
985 911
168
299
605
699
1,008
836 788
110
138
229
158 207
495
770
1,199
1,800
2,419
2,795
3,832
3,277 3,313
479
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
North America Europe Asia Rest of World
Funding has grown c.45% yoy since 2011 as
businesses and financial institutions innovate to
serve growing financial expectations
6
Source: Pitchbook
North America and Asia have led the world from a deal value
perspective, with mega-rounds from start-ups like Paytm, Ant
Financial, Opendoor and SoFi driving activity
On the other hand, Europe, has grown its share in deal volume
significantly over the years by c.20%
$8.6bn $7.8bn
$15.0bn
$8.2bn
$18.7bn$1.9bn $2.0bn
$4.0bn
$3.9bn
$7.3bn
$7.8bn $11.8bn
$25.8bn
$10.0bn
$8.4bn
$1.8bn $2.5bn $3.5bn
$8.8bn
$18.5bn
$21.9bn
$45.5bn
$22.4bn
$35.8bn
$7.0bn
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
North America Europe Asia Rest of World
Deal Value
Deal Volume

White Star Capital
+[xx]%
Growth in share of
deals from 17-19
Globally, the fintech ecosystem is maturing as
seed funding declines and later stage funding
steps to the forefront
7
The most mature of these regions include China, UK, USA and
Germany, where series D+ rounds becoming common place
China SEA France UK Scand. Canada USA Germany
Seed
share of
deals
20% 48% 43% 49% 64% 56% 47% 41%
(12.3)% (5.8)% (16.5)% (8.9)% (12.1)% (5.5)% (3.0)% (9.9)%
Series A
share of
deals
45% 35% 32% 30% 27% 25% 24% 22%
11.0% 0.9% 18.0% 9.9% 115.3% (8.1)% (2.9)% (8.6)%
Series B
share of
deals
20% 11% 18% 10% 9% 19% 15% 19%
(11.2)% (2.6)% 7.7% 0.8% NA 125.0% 11.4% 62.0%
Series C
share of
deals
9% 5% 7% 6% 0% 0% 6% 6%
(8.7)% NA NA 80.5% (100.0)% NA 2.1% (33.9)%
Series D
share of
deals
6% 1% 0% 3% 0% 0% 3% 9%
104.2% NA NA 67.1% (100.0)% (100.0)% 11.3% NA
Series E+
share of
deals
1% 0% 0% 2% 0% 0% 4% 3%
17.9% NA NA (21.2)% NA NA 7.1% 14.6%
Source: Pitchbook
Share of deal volume by deal stage type (2019)

Increasing valuations from the growth in popularity
of venture capital is most present in fintech with
valuations growing 13% yoy globally
8
Source: Pitchbook
(1) Asia excludes all rounds from CRED and Bharat Pay.
(2) Europe excludes WeFox, Pleo, Alan and Curve’s Series B rounds
Note: Please note Pitchbook valuation data has limitations and only considers rounds that have officially announced valuations. For this reason,
Africa and South America have been excluded.
However, European valuations are c.35% lower than the rest of the
world
Outsized rounds are becoming common place around the world too as
investors compete for the most promising fintechs
$9.0m $4.5m $4.5m
$24.1m $72.0m
$13.3m
$90.0m $120.0m $67.3m
Seed
Series A1
Series B2
North America Asia Europe
Checkout.com
Series A: $230m (2019)
UK
WeFox
Series B: $235m (2019)
Germany
Pleo
Series B: $56M (2019)
Denmark
Seyna
Seed: $15m (2019)
France
Next Insurance
Series A: $83m (2018)
USA
Borrowell
Series A: $44m (2017)
Canada
Bright Health
Series B: $160m (2017)
USA
Bakkt
Series A: $300m (2020)
USA
YouTrip
Seed: $26m (2019)
Singapore
epiFi
Seed: $13m (2020)
India
Blackfish
Series A: $145m (2018)
China
Fapiaoer
Seed: $140m (2019)
China
Median pre-money valuation
Selected outsized funding rounds
+14.1% +14.7% +7.0%
+9.6% +19.0% (6.2)%
+17.6% +4.9% 10.6%
+[xx]%
Growth in
valuations
from 14-19

White Star Capital
Deal sizes are consistently growing in the most
mature regions
9
Source: Pitchbook
Median deal size 17-19 CAGR
11.8%
18.8%
10.0%
Seed
Series A
Series B
USA
$22.0m
$9.3m
$2.5m 4.3%
(1.2)%
(11.7)%
Seed
Series A
Series B
Canada
$33.5m
$8.5m
$1.5m
72.8%
14.3%
38.3%
Seed
Series A
Series B
China
$28.1m
$10.0m
$4.4m 0.0%
62.5%
(1.0)%
Seed
Series A
Series B
SEA
$12.8m
$9.3m
$1.0m
52.2%
8.1%
52.4%
Seed
Series A
Series B
UK
$29.0m
$6.5m
$1.9m 20.4%
(16.0)%
4.9%
Seed
Series A
Series B
France
$22.5m
$6.6m
$2.5m
(15.5)%
(0.3)%
49.6%
Seed
Series A
Series B
Germany
$31.8m
$8.7m
$1.6m 28.5%
45.4%
0.0%
Seed
Series A
Series B
Scandinavia
$29.7m
$7.6m
$1.9m
[xx]% Median deal size (2019)

White Star Capital
$200m
Growth (Jan-20)
Sweden
Mega rounds in US and China have become
routine given market sizes
10
Source: Pitchbook
Note: Mega round refers to a round of $100m+. Rounds shown are largest 4 equity rounds in that year.
Mega rounds are a growing trend in Europe, as its status as a
recognised fintech hub has attracted international investors seeking to
deploy more capital
North America Asia Europe South America
$400m
Series F (Jul-19)
Brazil
$150m
Series E (Mar-18)
Brazil
$231m
Series D (Jun-19)
Brazil
2019
2017
2016
2018
2020
$460m
Growth (Aug-19)
Sweden
$470m
Series D (Jul-19)
Germany
$230m
Series A (May-19)
UK
$238m
Series F (May-19)
India
$1.7bn
Series G (Dec-19)
India
$200m
Growth (Apr-19)
China
$225m
Growth (Oct-19)
China
$1.5bn
Series D (Nov-18)
UK
$250m
Series C (Apr-18)
UK
$160m
Series C (Mar-18)
UK
$725m
Series E (Sep-18)
US
$750m
Growth (Sep-18)
US
$538m
Growth (May-18)
US
$2.0bn
Series B (Jul-18)
China
$14bn
Series C (Jun-18)
China
$280m
Series E (Nov-17)
UK
$153m
Growth (Jul-17)
Switzerland
Kabbage $250m
Series F (Aug-17)
US
$250m
Series E (Dec-17)
US
$808m
Series A (Dec-17)
China
$1.4bn
Growth (May-17)
India
$267m
Series B (Jan-17)
China
$210m
Series C (Dec-16)
US
$160m
Series C (May-16)
US
$180m
Growth (Oct-16)
US
$4.5bn
Series B (Apr-16)
China
$433m
Series D (Mar-20)
Australia
$500m
Series H (May-19)
US
$635m
Series D (Dec-19)
US
$500m
Series A (Sep-19)
US
$400m
Series F (Mar-20)
US
$700m
Series E (Mar-20)
US
$300m
Series B (Mar-20)
US
Mega rounds by region
• Europe has been at the forefront of the neobank revolution, given
European’s particular distrust in banks following the global financial crisis
• Lending and health
insurance start-ups
lead the way in
America which is likely
due to the more
positive attitude the
American population
has towards credit
and the absence of
state-funded
healthcare
• Cashless payments
are “king” in Asia
given consumers
significantly higher
propensity to fintech
adoption vs other
regions
$150m
Series B (Jun-20)
UK
$191m
Series C II (Apr-20)
Japan
$400m
Growth (Feb-16)
US
$300m
Series F (Jun-17)
US
$500m
Series G (Mar-17)
US
$375m
Growth (Aug-18)
US
$500m
Series E (Jan-19)
US
$850m
Series G (Apr-20)
US
$1.0bn
Series A (Feb-16)
China
$600m
Series B (Sep-16)
China
$476m
Growth (Jul-16)
China
$410m
Series B (Jul-17)
China
$1.0bn
Series D (Sep-18)
China
$1.5bn
Growth (Dec-18)
China
$205m
Growth (Oct-17)
UK
$134m
Series E (Dec-18)
UK
$235m
Series B (Dec-19)
Germany
$500m
Series E (Feb-20)
UK

Strategic M&A drives over 50% of exits in North
America, Asia and Europe
11
Source: Pitchbook
Embracing financial technology has become a focus, not just for
incumbent financial services, but for the technology and e-commerce
ecosystems too
1
1
2
3
1
4
5
7
8
6
1
17
13
24
29
39
9
22
19
33
40
46
10
2015
2016
2017
2018
2019
2020 Q1
Europe
3
1
3
3
5
6
12
5
17
21
4
40
39
50
47
51
12
49
52
58
67
77
16
2015
2016
2017
2018
2019
2020 Q1
NorthAmerica
4
2
8
7
11
1
3
2
1
1
4
5
7
20
14
12
5
12
11
29
22
27
6
2015
2016
2017
2018
2019
2020 Q1
Asia
25
21
34
42
48
1
1
1
1
2
2
2
2
3
28
23
37
45
52
10
2015
2016
2017
2018
2019
2020 Q1
SouthAmerica&Africa
$5.5bn
IPO (Oct-17)
China
$7.3bn
IPO (Jun-18)
Netherlands
$2.2bn
Acq. by PayPal (May-18)
Sweden
$1.4bn
IPO (Sep-18)
UK
$5.3bn
Acq. By Visa (Jan-20)
USA
$2.9bn
IPO (Nov-15)
USA
$4.7bn
IPO (Dec-14)
USA
Finvolution
$3.7bn
IPO (Nov-17)
China
OneConnect
$3.4bn
IPO (Dec-19)
China
$1.1bn
IPO (Dec-14)
USA
$1.3bn
IPO (Dec-19)
USA
51credit
$1.2bn
IPO (Jul-18)
China
$713m
Acq. by PayPal (Sep-13)
USA
Lakala Payment
$1.8bn
IPO (Apr-19)
China
$2.3bn
IPO (Dec-18)
China
Exits by type
Selected vc-backed exits

There are a number of
other fintech start-ups that
have raised a significant
amount of capital and are
approaching unicorn
territory too…2
There are 58 vc-backed fintech unicorns globally, with the payments sector
owning the lion’s share
12
Source: Pitchbook
(1) Amount shown corresponds to the last reported valuation.
(2) Amount shown corresponds to total amount raised.
Note: Unicorn: a vc-backed company that has publicly announced a fund raising round at a valuation at or above $1bn.
$4.8bn
US
$35bn
US
$1.2bn
US
$2.9bn
US
$1.2bn
US
$7.6bn
US
$1.0bn
Brazil
$4.9bn
US
$2.0bn
US
$3.7bn
US
$8.1bn
US
$3.8bn
US
$1.7bn
US
$2.1bn
US
$1.1bn
US
$1.3bn
US
$1.0bn
US
$1.9bn
US
$2.6bn
US
$1.0bn
US
$10bn
US
$1.0bn
US
$3.0bn
US
$1.0bn
US
$1.0bn
US
$1.0bn
US
$1.0bn
US
$1.0bn
Brazil
$5.8bn
US
$1.7bn
US
$3.0bn
US
$1.1bn
US
$1.9bn
US
$1.5bn
US
$1.4bn
US
$5.5bn
UK
$2.8bn
UK
$2.5bn
UK
$3.5bn
UK
$2.0bn
UK
$1.2bn
UK
$3.5bn
Germany
$1.9bn
Germany
$1.1bn
Germany
$5.4bn
Sweden
$1.0bn
Switzerland
$17bn
India
$1.5bn
India
$1.5bn
India
$1.3bn
India
$1.0bn
China
>$1.0bn
Hong Kong
$1.4bn
China
>$1.0bn
China
$1.7bn
Australia
$2.2bn
South Korea
$1.0bn
Japan
Asia (11) 1
Europe (11) 1Americas (36)1
$3.5bn
US
$388m
UK
$282m
UK
$303m
France
$195m
UK
$106m
France
$573m
US
$550m
USA
$559m
USA
$434m
USA
$190m
USA
$307m
India
$45m
Japan
$58m
China
$299m
India
$177m
Australia

Sector Focus

White Star Capital
The White Star Capital perspective on fintech
segmentation
14
Sector Focus
At White Star Capital, we approach fintech from the view of its
constituent use case building blocks
Consumer Facing Solutions
Personal Finance
Insurance
Financing & Lending
Products and solutions used by consumers to
better manage their finances
• Digital banking
• Bill management
• Insurance
• Credit and loans
• Remittance
• Trading
• Investment and
advisory
Enterprise Finance Solutions
Business Operation Tools
Insurance
Financing & Lending
Payments: PoS & Checkout
Products and solutions used by businesses to
manage their finances
• Digital banking
• Expense management
• Insurance
• Financing and loans
• Point of Service
Systems (PoS)
• Checkout services
• Payment Gateways
• Payroll management
• Accounting
Infrastructure
Payments: Infrastructure
Fintech-as-a-Service
Security, Analytics &
Compliance
Underlying products and solutions used by
businesses to provide their core services to
consumers or other businesses
• Payment Service
Providers (PSPs)
• Banking-as-a-Service
• Insurance-as-a-Service
• Fraud management
• Open banking tools
• KYC
• Data analytics

The White Star Capital perspective on fintech segmentation
15
Source: Pitchbook, Payments and Commerce Market Guide 2019
Sector Focus
Consumer Finance Solutions Enterprise Finance Solutions
Personal Finance Business Operation Tools (BOT) Insurance
Financing &
Lending
Payments: PoS &
Checkout
Infrastructure
Payments: Infrastructure Fintech-as-a-service Security, Data & Analytics
Banking
Bill Management
Loyalty & Rewards
Banking Solutions
Expense Management
P&C
Distribution
Banking
Insurance
Regulatory affairs
Data security &
transaction monitoring
Identity verification & KYC
PoS
Checkout
Money Transfer
Investment & Advisory
Brokerage
Insurance
Life & Health
Non-Life
Distribution
Remittance
E-Wallets & Account Aggregators
Student Finance
Financing & Lending
Real Estate
Point of Sale Financing
Credit Scoring
Consumer Loans
Salary-Based Finance
Payroll
Accounting
PSPs Payout Solutions
Execution & Settlement
PSP Enablers

Personal Finance

Consumer expectations from their banks are
higher than ever
17
Source: Pitchbook, news press
Sector Focus: Personal Finance
Personal finance: An Introduction
Personal finance is now one of the top funded sub-
sectors in fintech
Deal value & volume
Financial management refers to the control, planning and organization of one’s
finances in order to achieve a particular goal, whether it is putting money aside
for a short-term expenditure (e.g. buying a car or a holiday) or other longer term
plans (e.g. planning for retirement or saving for education).
From the birth of the Internet in the 1990s, money handling has been shifting
away from cash, to other digital forms. Now with the rise of mobile money during
the 2000s, through a broad range of personal finance services, consumers are
changing the way they spend, save and manage their finances.
This has propelled the unbundling of financial institutions, with new players
offering services optimised for specific products such as digital current accounts,
e-wallets, account aggregators, remittance, bill management, savings &
investments, brokerage, loyalty and reward tools. As these players look to
diversify and increase their share of the custome wallet, the rebundling of these
services is now in full swing.
# Deal volume
$635m $522m $837m $1,104m $898m $1,216m $1,355m
$2,736m
$4,065m
$1,314m
$973m
$1,264m
$2,061m
$863m
$680m $577m
$1,022m
$1,292m $1,272m
$1,655m
$2,328m
$4,000m
$6,126m
$2,177m
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 YTD
North America Europe Southeast Asia
175 90204 315 361 421 485 447 473 476

White Star Capital
The below start-ups have completely changed the
way people interact with their personal finances
18
Source: Company websites, press, Pitchbook
Note: total raised includes both equity and debt financing.
$845m raised to date
Selected Investors
$1.0bn raised to date
Selected Investors
Selected Investors
Raisin (Germany) offers a marketplace for savings and
investment products
Agreements with a network of European banks, allow Raisin to
seamlessly connect customers with banks searching for higher
yielding, safe, deposits
Selected Investors
Robinhood (US) is a mobile trading app where customers can
invest in stocks, ETFs, options and cryptocurrencies
Robinhood disrupted the brokerage industry with commission
free trading, subsidised by interest on customer assets, premium
subscriptions, margin trading and high frequency trading
Selected Investors
TransferWise (UK) offers a cheap global money transfer service
Through an intelligent network of bank accounts, Transferwise
enables customers to send money globally, without the money
crossing borders. Due to TransferWise using its own network
with no intermediaries, it is able to offer very low prices
Revolut (UK) offers a mobile platform for a number of financial
services including banking, trading and currency exchange
Revolut initially entered the fintech space with its free money-
exchange service and customer-centric mobile-only interface
Chime (US) is a neo-bank which provides financial services
through a mobile app
Chime changed the way people bank, offering a free basic bank
service through a smooth mobile-first experience

White Star Capital 19
Sources: Press releases, Cisco, Android rank
Regulation has favoured innovation
• Consumers have experienced
tremendous change in their customer
journey with the rise of mobile apps
offering fast, transparent and frictionless
processes
• However, financial institutions have
been slow to innovate and adapt to
rising customer expectations, held back
by outdated banking systems that are
expensive, complex and risky to maintain
and modernise
• Regulations such as PSD and open
banking have played a major role in the
emergence of fintech, levelling the
playing field to boost innovation
Vertically focused newcomers
• With a back-end and brand optimised
to focus on a limited number of
products, newcomers have been able to
amass market share very quickly and
provide superior experiences, setting
the benchmark for incumbents to meet
today
• Examples include Transferwise in the
money transfer industry offering
cheaper and easier to understand fee
structures, trading platforms like
Robinhood that have made it easier for
novice investors to build their portfolios
safely, or digital banks in Latin America
that have reduced the barriers to entry
for banking for much of the population
Regulation has helped the vertically focused digital
newcomers take market share
Mobile app average rating
Out of 5.0
4.72
4.48
4.78
3.72
2.72
Global mobile data traffic
evolution
Exabytes per month
- 0.2 3.7
19.0
77.0
2000 2010 2015 2018 2022E
New comers vs. incumbents
Cash
Cash
Online trading
Remittance
Digital banking for teens
Digital banking for the unbanked

Sources: news, CB Insight, TechInAsia, Bain, ThePaypers
(1) Aljazeera.
(2) Statista. Share of online population who bought something online via mobile device in the past month as of Q3-2019. This compares to the
following statistics: 69% (Thailand), 66% (Philippines), 38% (UK), 34% (Germany), 31% (France).
(3) Challengers banks: fintechs whose first MVP is a checking or credit card account. As of Q4-2019.
Wealthtech players yet to deliver
• B2C robo advisors aimed to democratize
wealth management through a low cost
approach and standardised asset-
allocation models, resorting to low-fee
passive products. They however failed to
take off due to the lack of clear value
proposition perceived for customers
• New players have understood the need for
higher customisation and some players
are adopting a B2B approach, partnering
with relationship managers who remain
crucial in the industry
E-wallet and account aggregators are
soaring, particularly in Asia
• Asia saw the use of e-wallets flourish,
quickly adopted by the underbanked and
those that were heavily reliant on cash,
driven by the rise of mobile penetration
and government initiatives to transition
into cashless societies
• Adoption in the West has been slower
due to the widespread use of debit
cards, which are being leapfrogged in
Asia
Growth at all costs no longer working for
neobanks
• Due to the difficulty in monetising
customers, neobanks initially focused on
building large user pools, based on a
"grow first, monetize later" philosophy
• As these companies mature, they are now
shifting their focus to profitability and
healthier unit economics. This has come
in the form of rebundling so as to benefit
from CAC synergies and further user
monetisation
Wealthtech players have not proved their models yet,
and growth at all costs is no longer sustainable for
neobanks
vs.
150
e-wallet
licence holders
in Asia1
80%
Indonesia
mobile
e-commerce
penetration2
39%
USA
mobile
e-commerce
penetration2
Total accounts added by
challenger banks3
20
8
6.5
5 3.7
2.2 1.6
B2C
solutions
B2B
solutions
Target banks,
brokers,
wealth
managers,
insurance
companies
Target
consumers,
experimented
or not

White Star Capital
Industry players are operating a rebundling of
personal finance services
21
Gen Z
Online brokerage
DigitalBanking
Freelancers
Investment&Advisory
Digital advisory
Drivers: The emergence of the leading players was boosted by the rise of global payments and
mobile technology, but brick-and-mortar agents like Western Union still dominate the market.
Targeted users include both the unbanked (Remitly) and the banked (TransferWise)
Diversification: There has been less rebundling so far than in other subsectors, as players focus
on expanding services geographically. Some of them are developing a B2B offering (WorldRemit)
Regulation: companies have either a fully-fledged banking licence (Starling
and Monzo in the UK, the latter applying for one in the US) allowing for investment
or lending services, or a less burdensome e-money institution status, similar to
Revolut in the UK
Diversification: Companies are expanding their product range, either
developing in-house, or through a marketplace model, offering third-party
services integrated into the platform. For example, Revolut provides lending
services through a partnership with LendingWork while Monzo is doing so
using its customer deposits. Starling is partnering with Wealthsimple, Habito,
PensionBee and Kasko on various products.
E-wallets
Diversification: For example Toss (14m users) offers money transfer, credit
score management, savings accounts or insurance, while Lydia (2m users)
offers services such as switching internet or energy providers, and device
insurance
Disruption: Shifting towards improved trading technology, tools and user experiences. Stock
trading was made accessible to novice investors through a frictionless experience with a quick
onboarding process, commission-free trading and no account minimums
Diversification: Companies are diversifying into crypto trading (Robinhood) or savings (Trade
Republique), in the hopes of becoming a one-stop-shop for trading
Business models: either B2C (Raisin) or B2B2C (Guideline)
Diversification: Raisin, initially focused on savings management, and then expanded into
pension and retirement through its acquisition of Fairr
Savings & pensions
Diversification: Some players have broadened their product range, offering, on top of
investing advice and savings management, retirement savings advice or pay advances
(Stash), while others still exclusively focus on investment management (Wealthsimple, Nutmeg)
Debit cardFirst product
Pay
advance
Brokerage
Peer to
peer
Robo
advisor
MortgageCryptoSavings
Consumer
loan
Insurance
Travel
Travel
Digital banking
Digital banking
Digital advisory
Digital advisory
Brokerage
Remittance
Life, Auto
Auto
Remittance
Product offered
Product announced
Source: CB Insight, company websites, news press
Payment Asset management Lending

White Star Capital
Current trends and new challenges are opening
the door for new opportunities
22
Financial education still a
going concern
• Fintechs have so far made their
products accessible to a wide
audience
• However trusted financial advice
is often only limited to the
wealthier members of society
Opportunity
• We at WSC, believe that the
fintech leaders of tomorrow will
be those, not only providing
easier access to financial
services, but doing so in a
responsible way, guiding users
through their financial decisions
throughout their life journey
• The fintech leaders of tomorrow
will be those who are able to
provide customers with holistic
financial wellness, taking a
long-term approach, drastically
improving lives as a partner of
trust, beyond the mere financial
product provided
• This is particularly key as the
millennial generation, whose
level of financial literacy is
notably low, will face the largest
transfer of wealth in history
Opportunity
• Innovation in financial services
has so far occurred where the
shift in expectations and
behaviour has been the fastest,
i.e. 15 to 40 year olds
• WSC sees tremendous
opportunities for fintech players
addressing the ignored segment
of individuals coming up to
retirement
• Promising areas include
supporting the elderly in need of
additional sources of income,
equity release products, annuity
products, offering estate advice,
tailored financial protection or
financial advisory
The unprepared new
generation of retirees
• Near and current retirees are in
a more vulnerable position
than previous generations, often
with low savings and pensions
• Their apprehensiveness
towards technology will also
prove to be an obstacle in
helping this generation

Insurance

Spreading risk amongst many
24
Source: Pitchbook, Scottish Widows, ActiveQuote
Sector Focus: Insurance
Insurance: An Introduction
Insurtech has been one of the more recent trends in fintech over
the last decade, with VC’s starting to see the opportunity in 2015
Deal value & volume
The earliest forms of insurance begun with managing nautical risk. Merchants shipping their goods
around the world, needed a way to protect themselves against the risks of losing or damaging the
cargo or sinking the ship. Insurance then was structured similarly to an interest-bearing loan, in
which the merchants took out a loan to fund the voyage. If the cargo was lost or damaged, the loan
could be used as compensation, or if the ship sunk, the loan would not be repaid. The interest
would cover the risk for the loan provider.
As the world became increasingly more complex and advanced, insurance became available for a
number of different types of risks beyond nautical. Most of these agreements were struck between
independent underwriters, merchants and banks at coffee shops, up until the 1600s when Edward
Lloyd developed a more structured setting for this, what we now call today the Lloyds of London
marketplace.
Around the world, more structured entities were forming to insure risk, namely Benjamin Franklin in
the US launching The Philadelphia Contributionship in 1752 to offer fire insurance to Philadelphia
citizens, Alpine Farmers agreeing to look after each other if their livestock or children became ill (the
beginning of Zurich and Munich Re) and Scotsmen coming together during the Napoleonic Wars to
secure provisions for widows, sisters and children to ensure they were looked after on the event
of the death of their fathers, husbands or parents (the beginning of Scottish Widows, Scotland’s first
mutual life insurer).
The transfer of risk has been a major part of society from its very inception and has been governed
by enormous financial institutions that have become outdated, technologically and socially.
Consumers today know they need insurance, but would rather not to have to think about it.
Therefore they require ease and convenience, provided by a transparent and trustworthy brand,
and insurtech start-ups have been taking advantage of this fact to gain market share.
$1,341m $1,454m $1,170m
$2,772m
$4,508m
$474m
$424m
$842m
$25m $167m $254m
$514m
$1,424m $1,580m $1,680m
$3,238m
$5,401m
$555m
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
24 7238 73 99 165 237 337 409 369

White Star Capital
Distribution
The late 2000s marked the beginning of the
insurance revolution
25
Source: Insly
Particularly in Europe, most of the early innovation in the industry was at
the distribution level, where typical broker channels were being replaced
with comparison markets
Policy-
holder
Insurer/
Carrier
Re-
insurer
Customer (consumer or business) agrees to
pay a fee (premium) to insurer in exchange for
a financial guarantee for the risk in question,
and becomes a policyholder
Risk-baring territory
Broker
Carriers
Key Parties
• Broker: Intermediary that sells, solicits or negotiates insurance policies for customers on behalf of insurance providers
• Insurer (Carrier): Financial institutions that build, sell and service insurance products to consumers and businesses
• Managing General Agent (MGA): Intermediary that specialises in particular types of risk, but uses a carrier to provide
the required capital reserves, licences or underwriting expertise to create insurance products
• Traditional MGA: Type of MGA that only provides the expertise and understanding in the policy design process.
The carrier will use this to design the policy (e.g. pricing)
• Quasi-Carrier: Type of MGA that will use a carrier to provide the expertise, required regulatory capital reserves
(capacity) and licences, in order for them to have complete control over the insurance experience without having
to expend resources on establishing themselves as a risk-baring carrier
• Reinsurer: Financial institutions that build, sell and service insurance products to insurers, enabling to increase their
capacity to write more insurance products and generate more profit
Insurance Ecosystem Overview
Traditional MGAs and Quasi-Carriers
Insurer agrees to cede a
share of the written
premium to a re-insurer
in exchange for a
financial guarantee for
the risk in question
With the help of a number of supporting
software products, insurer uses MGA to
develop insurance products in a market where
they see an opportunity
MGAs, QCs and
carriers use brokers to
distribute their
products, in exchange
for a commission or
share of the premium
Often, MGAs, QCs and carriers
will completely bypass brokers
and sell their products directly to
customers
Quasi-
Carrier
Traditional
MGA
Supporting software
Most start-ups will launch as
traditional MGAs, and then
transition into quasi-carriers to
increase their margins

White Star Capital
Using their much deeper understanding the their
customer base, start-ups are competing with insurers as
MGAs
26
Source: Company websites, Forbes, TechCrunch, Pitchbook, CBInsights, Fortune
Selected InvestorsOscar (US) is an online tech-enabled health insurance network
Oscar’s data operations built a doctor classification engine to
ensure policyholders were referred to the exact doctor they need,
which is not the case with incumbent health insurance providers
Selected Investors
Lemonade (US) is a licensed carrier providing digital home
insurance products to consumers
Lemonade opted to become a licensed carrier first to have
complete control over their entire experience from the very
beginning
$60m raised to date
Selected Investors
Using artificial intelligence, Shift (France) provides solutions for
claims automation and to combat insurance fraud
Using machine learning, Shift is improving the claims process
for both insurers and consumers, with fraud detection and claims
settlement rates far high than industry standards
Selected Investors
Next Insurance is a one-stop shop for insurance products for
SMEs
Today, there are more start-ups and SMEs than ever before, the
Next founders used their experience as serial entrepreneurs to
develop products that properly cater to entrepreneurs
Selected Investors
BIMA (UK) builds and sells microinsurance services for low-
income consumers in developing countries
BIMA’s success largely stems from its execution in a
completely underserved market, in providing right-sized
insurance products for the region it’s being sold in

• Insurance is shifting away from a sole focus on
operational efficiency as the key profit driver
• Start-ups are winning by providing customers
with relevant products, at the right moment in
time, in a convenient, transparent and
personalised manner
• Developing these types of solutions. but with the
understanding that protection is more than just
about the financial benefit, but also about
preventing the event from ever occurring is how
companies like Lemonade are winning the hearts
of customers today
• Artificial intelligence has been a significant
area of focus in insurance given its many use
cases across the insurance value chain
• In particular, improved sales processes
through chatbots that can provide a more
personalised experience, or improved claims
processes for customers, with a greatly
reduced risk of fraud for the insurers
• Incumbents and start-ups alike have embraced
artificial intelligence as one of the biggest
drivers of efficiency
(1) EY. (2) International Data Corporation. (3) Raconteur. (4) Willis Towers Watson.
• The underlying fuel for insurance is data
• In order to price better than a competitor,
having better data on the customer being
served is key. Providing a better customer
experience through AI can only be achieved
with enough data
• Both incumbents and start-ups have
recognsied, the criticality of data and the
insurance industry has transformed into a
battlefield, where telematics, connected
devices and data are at the centre
Usage based insurance has so far
generated the following benefits:
Which should inevitably result in
cheaper premiums for customers
Shift from reactive, to proactive and
personalised
Harnessing AI across the value chain
Data or die
Wielding data and customer centricity are the key
trends of insurance today
40%
Reduction in
claims costs1
40%
Reduction in
policy costs1
$78bn
Spending on
cognitive and AI
systems by 20222
58%
Of insurers are
focusing AI
implementation in
customer
experience3
68%
of P&C insurers
believe advanced
data analytics will
have a positive
impact on their
top line4
86%
of P&C insurers
believe advanced
data analytics will
have a positive
impact on their
bottom line4

White Star Capital
Customer acquisition poses one of the biggest
challenges to insurtechs at the moment
28
Customer acquisition and retention
• Despite the prevalence of insurance, customer acquisition remains one of the
largest road blocks to scaling for insurtechs
• Often this is driven by
• A lack of perceived relevance
• Lower brand loyalty in more price sensitive regions (e.g. UK, Germany)
• A lack of trust compared to the established brands
• As well as this, the insurance industry is widely known as having one of the lowest Net
Promoter Scores (NPS)
• This has a significant impact on the unit economics of insurtechs as average revenue
per customer tends to be lower than in other sectors, and lifetimes are lower due to
poor claims experiences driving reduced retention
Opportunity
• In a similar way to how direct-to-consumer (DTC) businesses carved their mark into
the e-commerce landscape, through marketing, branding and building trust to cater
to the modern consumer, insurtech companies should employ similar tactics
• Insurtechs do have customer centricity at the heart of their operations, however they are
still struggling to overcome this challenge, given the stronger inertia of the insurance
stigma
• WSC believes that insurtechs that can provide insurance products in contextualised
environments will increase engagement and consumers abilities to assimilate with
brands and improving unit economics. Examples include:
• Non-insurance products that are extensions of their core product
• Offering insurance indirectly, as part of a wholesome solution along other
products or services
• Distributing products as memberships, driving home the perception that you
are a member of a community

White Star Capital
WSC also sees other opportunities that will create
value in the future
29
Going down the stack
• Insurtechs today are launching as
distributers, then transitioning into
MGAs
• We expect that as these insurtechs, as
they continue to scale and build their
brands, will want to take the next step
and become a carriers themselves,
increasing margins and having more
control over their offering
• However becoming a carrier is far more
of an arduous, expensive and complex
process than becoming an MGA
Opportunity
• Similar to WeFox’s acquisition of
One, and Metromile’s acquisition of
Mosaic, WSC sees an opportunity for
more flexible and innovative carriers
to present themselves as acquisition
opportunities for the large
insurtechs with MGA models today,
to allow them to make that leap to
becoming a carrier
New areas of risk
• More risk categories are arising, and
previously uninsurable risks are now
more attractive to serve
• However these ventures often are
accompanied by a significant amount
of education which is proving to be an
obstacle for scaling
Opportunity
• WSC sees two opportunities
stemming from this challenge
• Insurtechs that are identifying
new and growing markets of
risk that are currently
underserved means they will
have the opportunity to set
the rules of the playing field
and build a brand quicker
• Insurtechs that are using new
methods to provide insurance
to SMEs that revolutionise the
insurance value chain,
allowing them to cut costs or
provide a better service in a
sustainable way
• Overcoming the education challenge
will come from a meticulous focus
on the accessibility, distribution
and brand of the product

Financing & Lending

$2.1bn $1.4bn $2.0bn
$3.6bn
$7.3bn
$5.2bn $5.8bn
$8.4bn
$11.7bn
$1.8bn
$1.3bn
$1.8bn
$1.7bn
$3.1bn
$2.5bn
$4.0bn
$1.3bn
$0.8bn
$2.7bn
$2.1bn
$2.9bn
$4.9bn
$9.2bn
$6.9bn
$9.1bn
$11.4bn
$16.5bn
$3.3bn
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
0.3 0.20.5 0.7 1.0 1.2 1.3 1.4 1.5 1.4
Enriched data and new ways to digest this
information has opened up the door for innovative
lending & financing solutions
31
Source: Pitchbook, press
Sector Focus: Financing & Lending
Financing & Lending: An Introduction
Historically, lending has been one of the most funded
fintech sectors
Deal value & volume (k)
Lending has been a critical part of civilisation for thousands of years, with the earliest examples
found in ancient loan contracts outlining agreements in the agricultural communities in
Mesopotamia where farmers would trade harvest or animals, with the promise of delivering more at
a later point in the future. Formal lending, as we know it today, is believed to date back to Ancient
Rome, where wealthy individuals or pawnbrokers would offer loans similar to payday loans, that
were secured through items held as collateral.
Even though the fundamentals of lending have remained fairly similar over the centuries, the funds
lent has steadily increased and the underlying technology has advanced, contributing to much of
the commercial and industrial growth we have seen globally.
While established financial institutions have dominated the lending landscape for quite some time,
providing financing to relatively low-risk borrowers, the 2000s saw the emergence of alternative
lending and financing players, particularly after the global financial crisis, when the general public
lost their trust in traditional lenders and as the latter faced tougher regulatory scrutiny, limiting
lending.
Lenders today are leveraging online platforms and innovative credit scoring methods to provide
financing to consumers and businesses historically underserved by traditional banks, in a quick,
cheap and efficient manner. Rather than through simply consumer deposits, many platforms today
now source their capital using debt itself, or equity pools from both retail and institutional
investors, as well as covering higher risk categories e.g. unsecured loans, or specific needs such as
working capital financing, students loans.
# Deal volume (k)

White Star Capital
Security Analytics Compliance
The emergence of alternative lending occurred in
the early 2010s following the global financial crisis
32
Source: Press, FT Partners, Morgan Stanley, Bank of America Merrill Lynch
(1) includes banks, insurers and asset managers.
(2) Merchant Cash Advance.
Alternative lending platforms have simplified and made access to capital
for all types of businesses and consumers far more transparent
Ecosystem
Balance
sheet
lenders
Underwrite
own loans
Fill in paperwork
Provide loans,
charges origination fee (driven
by merchants or consumers)
Capture spread
Provide Capital
Institutional1,
Hedge Funds,
VC
Asset-light
lenders
Act as
brokers
Security,
analytics &
compliance
players
Lending platforms
Institutional,
public bodies,
supranational,
Retail
Allocate loans
Provide Capital,
pay servicing fee
Consumers &
Businesses
Fund providers
Debt collectors
Home improvement Education Invoice financing Real estate Marketing spend
Bring
business
Pay fee
Distribution
partners
Indicate best
lending option
Key Parties in the ecosystem
• Borrowers: Consumer or business in search of capital, to financing something, that they will pay back
• Loan investors: Investors looking for yield-generating investments, providing equity or debt
• Lending platform: Online platforms monetising mostly through fees charged on loan origination and
servicing
Borrowers
Verticalized lending players
Fill in paperwork,
pay origination fee
to lending platform
Provide
information for
profile analysis
Provide regulatory check

White Star Capital
Selected Investors
Klarna (Sweden) provides an online payment platform facilitating
payments through instalments
Klarna increased merchant conversion rates, allowing them to
provide affordable financing options at time of sale, which was
far more convenient then any other form of financing
These start-ups have democratised access to capital
for consumers and businesses over the last decade
33
Source: Company websites, press, Pitchbook
Note: total raised include both equity and debt financing.
Selected Investors
Selected Investors
Selected Investors
C2FO (US) is a working capital marketplace for vendors and
buyers
C2F0 solved fluctuating cashflow issues, by changing the
buyer/supplier relationship, allowing suppliers to get paid earlier,
while providing buyers with a discount
Selected Investors
Kabbage (US) provides funding to SMBs through automated
business loans
Founded in the wake of the crisis, Kabbage upended lending
with a strong focus on data reducing defaults, and offering
extremely fast loans vs. incumbents
Opendoor (US) provides an online real estate marketplace
aiming to simplify home buying and selling
Opendoor pioneered the ibuying concept, bypassing
intermediaries to reduce the time wasted and the significant
fees that come with the traditional homebuying process
Sofi (US) provides an online consumer finance platform
SoFi initially launched as a student financing platform, providing
accessible and affordable funding to help young Americans fund
their education

Sources: Pitchbook, press articles, news, Financial Times, Forbes
(1) As of 31-Mar-2020.
Focus on credit decisioning
• Part of the promise of alternative lenders
resides in the ability to conduct
enhanced analysis on enriched data,
in order to better assess the risk
profiles of prospective borrower that
were historically overlooked by traditional
banks. Earliest initiatives tackled
unsecured consumer loans and SMBs
financing needs
• New models aim to provide an edge vs.
traditional institutions through
technology e.g. with AI, machine
learning and/or predictive modelling, as
well as improved methods of data
digestion in risk scoring algorithms
• Such innovative credit models aim to
increase credit acceptance without
increasing credit risk
Room for improvement indicated by the
largest players
• New credit scoring methods remain to
be proven. Although underwriting
methods are improving, the largest
alternative lenders are still loss making
(Lending Club, Funding Circle), or have
thin margins (OnDeck, Greensky)
• The sector has also suffered from
reputational scandals regarding
questionable lending practices
(Lending Club, SoFi)
• This challenge comes along with
expensive customer acquisition, as
well as costly funding, vs. banks that
benefit from low-cost deposits
Many new lenders have focused on credit decisioning.
However, recent poor performance of large new lenders
shows there is room for improvement
Ad metricsPayment transaction
Unsecured consumer loans
SMBs financing needs
Enriched data includes:
Live bank feedsMarket insights
Share price decrease since IPO1
(95)% (78)%
(95)%(87)%
Early initiatives in:

A favourable market environment
• The GFC led to a low yield environment,
driven by low central bank interest rates,
slow economic growth and low inflation
expectations
• This made alternative lenders, in search
of funding, attractive to investors looking
for high-yield generating investments
• As we enter a tougher era post the COVID-
19 crisis, players might be put under
pressure as risk models are truly put to the
test
Supportive regulation
• Open banking is opening up bank data to
non-bank players, who can thus leverage
technology to provide advanced,
frictionless and better tailored products to
customers
• The lighter restrictions applying to non-
bank lenders, such as low capital
requirements, allow for a smooth and
quick go to market strategy, compared to
established financial institutions
Growing competition on the battlefield
• Established banks, now launching new
alternative lending solutions
• Large multinational tech companies,
broadening their product offering, pushing
lending and financing solutions to their
customer base
• Challenger banks, expanding into the
lending field
New lenders have benefited from a favourable market
environment, as well as advantageous regulation, which
has led to intense competition
New tech entrants
Sources: news, companies’ press releases, tradingeconomics.com
(1) American Federal Reserve Systems.
(2) European Central Bank.
(3) Revised Payment Services Directive.
0.0%-2.4%
US FED1
interest rate
over 2010-20
0.0%-1.5%
ECB2
interest rate
over 2010-20
Low interest rates
Slow growth
1.5%-3.0%
US GDP growth
over 2010-20
(0.5)%-3.0%
US GDP growth
over 2010-20
Dodd-Frank Act & Basel III
• Put banks under scrutiny
• Imposed capital reserves
• Set underwriting requirements
• Reduced banks’ answers to loan requests
PSD23
• Pushed for more data transparency
• Broke down banks’ monopoly on their user’s
data
• Allowed third-parties to retrieve users’
account data

White Star Capital
New challenges are opening the door to new
opportunities
36
(1) CAGR of the gross volume of the global gig economy.
Competition is heating up
• The 4 main differentiation levers that lenders can play with includes their
access to capital from fund providers, credit decisioning, customer
acquisition, and the customer experience they offer
• Many of these levers are reaching the point of diminishing returns, for example
access to capital is no longer as much of an obstacle as it once was, and with this,
the lending market is slowly showing signs of commoditisation
Opportunity
• By targeting a niche market and
answering very specific user needs,
new lenders will have the
opportunity to become the #1
reference in the field and thus
benefit from increased visibility,
better value perception and
easier access to distribution
channels
• A recent example is Greensky in
the home improvement industry.
Players have also tackled areas
such as invoice financing or
marketing spend
• We, at WSC, believe that
emerging underserved customer
segments still represent a
tremendous opportunity for new
lenders. An example is the gig-
economy, expected to grow at a
17.4% CAGR over 2018-231 and
which includes 162m workers
across the US and Europe, or the
nascent pool of SMBs in Asia,
that increasingly require financing
Opportunity
• We believe that the future leaders
in lending will be those operating a
rebundling of the financial
services they offer: broadening
their product range for a specific
customer segment or use case.
• The current market is becoming
increasingly fragmented with an
abundance of financial applications
and platforms, across all fintech
sub-sectors
• As such, becoming a one-stop-
shop for specific users – offering
financing, debt collection, admin
support and cash management in
one place for example, has the
potential to lead to a highly virtuous
circle: increased stickiness
leading to improved data
collection, allowing for enhanced
tailored recommendations on
new financial products, leading to
further increased engagement

Business Operation
Tools

Business operation tools’ main competitor remains
the spreadsheet
38
Source: Pitchbook, Mobiletransaction.org, theFintechtimes
(1) OECD. (2) IDC, VirginMedia. (3)In an effort to be conservative with the funding rounds included in this data, the following keywords were used
on Pitchbook: payroll software, b2b banking, business banking, expense management software and accounting software. Therefore this may not
be a complete view of the funding landscape.
Sector Focus: Business Operation Tools
Business Tools: An Introduction
Funding for Business Tools has begun to pick up in Europe, and
we expect to see the same trend in SEA in the coming years
Deal value & volume3
Big corporates have the resources to build their business operation tools internally, or
are big enough to provide enough custom to make developing solutions for them an
attractive opportunity. Outside of this, SMEs have simply had to make-do with either pen
and paper, spreadsheets or the solutions that were designed for bigger businesses,
that may be too complex or not necessarily suit their specific needs.
SMEs have however always accounted for the largest share of businesses globally,
reaching around 99% today1. In 2017, the IDC also found that these businesses share
exactly the same strategic imperatives that large corporates do, i.e. the power that having
the most up to date technology can provide, in particular from a competition perspective2.
These two points highlight how large the SME opportunity is for business tools.
However until recently, it has been largely untapped for two main reasons, SMEs being
held back by a lack of knowledge and willingness to get comfortable with the new, and
the naturally fragmented SME customer pool, which has resulted in scaling any business
providing these services difficult.
With the mass onset of cloud services, digital marketing, millennial thinking and
demands, SMEs are becoming an increasingly attractive market to serve as innovative
entrepreneurs crack the ability to scale these businesses, and business owners
themselves get comfortable with technology
$122m $250m $206m
$503m $520m $367m
$779m
$1,558m $1,579m
$192m
$232m $203m
$324m
$1,286m
$280m$142m
$482m
$219m
$526m $563m $572m
$955m
$1,889m
$2,877m
$471m
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
37 3953 79 102 126 159 183 161 158

White Star Capital
These start-ups have brought small businesses into the
future with their innovative but simple platforms
39
Source: Company websites, Techcrunch Pitchbook
Selected Investors
Gusto (US) is a payroll and benefits platform, allowing firms to
provide benefits like health insurance and 401(k) plans
Gusto’s simple and cross-platform friendly solution to digitising
and automating payroll and partnering with accountants to go-to
market allowed the business to reach unicorn status in 4 years
Selected Investors
Brex (US) is a corporate credit card provider for start-ups
Corporate expenses have long since been difficult for start-ups
to manage, as incumbent providers often overlooked this
market. With no personal guarantees or deposits necessary,
Brex quickly became a favoured business tool for start-ups
Selected Investors
Qonto (France) is a business neobank providing financial
services for SMEs
With its simple sign-up process, modern interface and easy
accounting service integrations, Qonto has simplified the
process of opening a business bank account considerably
Selected InvestorsAvidXchange (US) is an accounts payable automation and
payment processing platform for middle-market businesses
In an environment where the majority of businesses pay bills
manually and offline, AvidXchange has brought invoicing into
the digital age
Selected InvestorsCarta (US) helps private company investors, founders and
employees manage their equity and ownership
Initially a digital platform for start-ups to manage capitalisation,
Carta’s continuous rollout of solutions to aid start-up
stakeholders led the company to become a leader in this space

• SMEs often do not have deep technical
resources such as developers and software
engineers in-house to automate operations
• Many of the tools that have garnered
success today have been built with UIs that
are easy to understand and use, and sold
at an affordable price point
• Many of these non-technical business
owners now use software that employs
RPAs and APIs to support their businesses,
something which was often only available
exclusively to developers
• Millennial business owners and
employees are demanding just as much
from their relevant firm’s financial
operations, as they do from their own
financial operations
• Millennials do not see why their account
payables and payrolls cannot be
automated, or why opening a business
account cannot be as simple as opening
a personal bank account has now
become
Source:
(1) Mckinsey. (2) Euractiv. (3) Smallbusiness.co.uk. (4) Techcrunch. (5) Accounting today. (6) Xero.
• Start-ups focused in the accounting
services space have gained the most
traction in automating simple but very
time consuming tasks e.g. bookkeeping
and expense claims
• This has forced accountants to broaden
their service offering, develop their
technological understanding and add
value today, not just as financial advisors,
but as a strategic business advisor
Simplicity and self-service at the
forefront
Rising expectations
Changing role of accountants as more
and more tasks are automated
Only 25% of smaller businesses are automated,
but this is changing1
£8.7bn
is lost by UK SMEs
managing company
expenses3
61%
Share of businesses satisfied with the
breadth of services their accountant
offers6
60%
of US businesses
that still manage
accounts payables
offline4
89%
Share of
businesses that see
their accountant as
a trusted advisor5
70%
Share of
businesses that do
not work with an
accountant due to
costs5
It is expected that if
30%
of SMEs adopted modern and advanced
IT tools, SMEs combined revenues
could increase by
€570bn2

White Star Capital
There are too many solutions for SMEs to choose
from
41
(1) Xero.
It’s a jungle out there
• Given the rise in popularity and interest in this space, there is now an
abundance of solutions for payroll management, accounting, business
banking etc.
• SMEs use on average between 40 and 99 different apps to run their
businesses
• This has created a jungle that has been difficult to manoeuvre for the
business owner
Opportunity
• Business owners want to innovate, and they want to have
technologically advanced operations ensuring the efficiency of their
businesses, but they want this with as little effort as possible
• These solutions themselves may be simple to use, but using a number of
different solutions and being able to integrate them can become
complex
• WSC sees an opportunity for fintech businesses to debunk this jungle,
create a one-stop shop for business operation back-end, providing all the
necessary services required to run a business but with a simple to use UI

Payments

The trading of value is one of the most important
aspects of civilisation. As it has become more
complex and global, so too has the ability to pay
43
Source: Pitchbook, Mobiletransaction.org, theFintechtimes
Sector Focus: Payments
Payments: An Introduction
Since the first payment card in 1950, North America has been a leader in
payments innovation, and has continued to hold this position consistently
accounting for 70%+ of payments funding
Deal value & volume
The beginning of the electronic payments revolution dates back to the 1950’s with the introduction
of the first payment card, a cardboard card issued by Diners Club in the US, with the intent of
providing merchants with a standardised way to settle transactions with their own bank and their
customer’s bank, without the use of cash. Following this, innovators like American Express,
Barclays and IBM played major roles in the introduction of the plastic card, the first analogue card
machine, the magstripe and the chip and pin concept. However it was not until 1979, when Visa
introduced the first electronic card machine terminal and the card network as we know it today,
that card payments took off globally.
By the late 1990’s, electronic payments were a norm and the internet became widely accessible for
consumers, marking the beginning of the e-commerce revolution. Virtual payment terminals and
other new and innovative ways to offer online payment services from companies like PayPal and
Authorize.net were the key drivers behind the rise of Amazon, Ebay and e-commerce as a whole.
As commerce has evolved, consumers’ needs for speed and convenience has risen, in turn forcing
merchants’ to provide goods and services underpinned by these aspects (including the ability to
accept all payment methods globally and from various card networks) at a fair price.
$632m $681m $576m
$1,554m $1,403m $1,290m
$1,887m
$2,307m
$3,529m
$1,440m
$485m
$267m
$541m
$516m
$1,124m
$316m
$712m $825m $870m
$2,065m
$1,739m $1,593m
$2,496m
$2,978m
$4,740m
$1,803m
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
184 90224 329 444 489 486 543 540 490

White Star Capital
Online PoS/gateway
Offline PoS/checkout tools
A simple card transaction involves several parties that
have all experienced a significant amount of innovation
in the last 2 decades
44
Source: Adyen, FintechWeekly, BlueSnap, Deloitte
(1) Merchant Maverick provides a great overview of how these fees work (https://www.merchantmaverick.com/the-complete-guide-to-credit-card-
processing-rates-and-fees/).
These parties will often manage one or more of the processes in a card
transaction, particularly as competition has increased and M&A moves to
the top of these companies’ agendas
Customer
Merchant
Acquiring
Bank
Merchant
Acquiring
Bank
Issuing
Bank
Customer pays at
checkout (online or
offline) using card or
mobile. Payment
gateway will connect the
checkout with
processing network and
begin the transaction
Payment information
is transmitted to the
acquiring bank
through the payment
gateway
Payment outcome is
transmitted to terminal and
if successful, the acquiring
bank will extend a line of
credit to the merchant that
the issuing bank will repay
Acquiring bank uses the
card network and
payment information to
request funds from
issuing bank
Issuing bank decides
whether to accept or
reject request,
sending this decision
back through the card
network to the
acquiring bank
Customer
acknowledges
outcome
Payment processing
network
Customer payment methods
Card networks/schemes
Payment processors
Issuing banks
Acquiring banks
Key Parties
• Acquiring bank: Financial institution that
underwrites and often processes and
settles card transactions
• Payment processor: Entity that facilitates
communication between the merchant, and
acquiring bank and issuing bank
• Card network: Used by the payment
processor or acquiring bank to
communicate with the issuing bank
• Issuing bank: Customer’s bank
These parties generate revenue
through charging fees, which
vary widely based on the
transaction type, industry,
sale amount, card
type1
Card transaction overview

White Star Capital
These leading start-ups have played major roles in
improving payments for consumers and businesses
45
Source: Company websites, Pitchbook
Selected InvestorsStripe (US) provides a number of online payment services for
merchants that simplifies the process of taking payments online
Stripe was one of the first to market with its easily accessible
API which simplified online payments for businesses
Selected Investors
Marqeta (US) partners with issuers, providing processing
services that gives card issuers total control over card usage
Unlike acquirer processors (e.g. Adyen), Marqeta manages
issuer processing, enabling businesses and consumers to make
payments with the world’s first issuer processing open API
Selected InvestorsGoCardless is an online direct debt provider, that offers services
to enable merchants to take direct debit payments
Before GoCardless, offering direct debit services, although
attractive to consumers, was a very cumbersome for businesses
Selected InvestorsUsing one integration, Checkout.com (UK) enables merchants to
take payments from around the world
Checkout.com differentiates through its API, that offers in-country
acquiring and feature parity across markets and currencies
Selected InvestorsYapstone (US) provides payment services to marketplace
businesses to enable them to take payments
Yapstone competes with companies like Stripe and PayPal by
offering payments solutions specific to marketplace businesses

• Millennials and Gen-Z command a
significant share of global consumer
spending power and continue to
demand more convenience, more
ease, more transparency and more
control over paying for goods and
services
• Millennials have been a key pushing
force in the adoption and rapidly
growing penetration of mobile
payments
• Sustained growth in e-commerce has
continued to drive growth in the
payments sector and will continue to do
so as millennials and Gen-Z, who prefer
e-commerce channels, continue to
increase their share of global spending
power
• Unfortunately this comes along with
increased security risks, as cyber
attackers continue to innovate and grow
Source: Mckinsey, PaySafe
(1) Mckinsey. (2) PaySafe. (3) Digitalcommerce360 (4) Juniper Research. (5) Statista. (6) SmartInsights.
• Today, the ratio of time spent mobile
shopping to money spent is 4:15, a
large proportion of transactions are
started on mobile devices, but
completed on desktops
• However this is beginning to change as
the mobile experience improves and
gains parity with desktops
Changing consumer behaviours
E-Commerce penetration continues
Mobile penetration beginning to deepen
Millennials and Gen-Z demands are changing the
payment landscape as we know it…
$350bn
Spending power
of Millennials and
Gen-Z in US1
40%
Share of global
consumers Gen-Z
accounts for in
20201
53%
Share of Gen-Z consumers that prefer
contactless payments2
+14%
Global CNP fraud
growth by 20234
+18%
2019 global e-commerce
sales growth3
1.0 1.4 1.8 2.3
2.9
3.6
52%
59% 64% 67% 70% 73%
2016 2017 2018 2019 2020 2021
Global Mobile E-Commerce
Sales
Sales ($trn) Penetration
5
+40%
2016-18 growth in global e-
commerce penetration3

• More and more technology companies
are entering the world of fintech in order
to stay relevant and offer their
customers a more complete experience
• Following in the footsteps of SuperApps
in Asia such as WeChat, Go-Jek and
Line, tech giants in the west are applying
this approach and entering the payments
landscape
• Due to less stringent data regulations,
API usage has become the norm in
Asia, and are becoming central to
financial services in Europe and the US,
whether for incumbents, start-ups or
merchants, driven by the need for
greater convenience and simplicity for
end users
• APIs alleviate pain points from
complex and custom integrations and
help to develop unified global solutions
• As the payments sector grows, new
regulations and reforms are being
introduced to protect end customers
• Overall, data is paramount, and the
more that businesses can understand
about their customers, the better their
advantages are against the competition
• Regulators understand the importance
of ensuring that consumers do not take
the brunt in the race to be the best
Examples of tech players
launching payment solutons
Leading start-ups with APIs at
their forefront
Key payment related
regulations
Evolving Competition
APIs are becoming critical to payment
operations
Regulators are keeping up the chase
…creating opportunities that are attracting new
competitors to enter the race and forcing major
regulatory changes
6
PSD2
EU Payment
Services Directive
PCI DSS
Payment Card
Industry Data
Security Standard
GDPR
General Data
Protection
Regulation
3DS 2.0
3D Secure 2.0

White Star Capital
However there still exists a number of challenges that
will present opportunities to create significant value
48
(1) Digitalcommerce360.com.
(2) Please see here for a great overview of 3D Secure 2.0 (https://www.adyen.com/blog/3d-secure-20-a-new-authentication-solution)
Commoditisation
• Staying differentiated is becoming
increasingly difficult for incumbents
and start-ups alike as the market
becomes more crowded and
processing speed, convenience,
security and capabilities become
commoditised attributes, eating
away at PSPs’ margins
• Interchange fee caps in Europe and
USA are also squeezing margins of
PSPs, and this trend may spread to
Asia too
Complex Payment Stacks
• On average, businesses will have 5
processors and 4 merchant
acquirers1
• Merchants now believe there are too
many options on the market, and
they themselves are currently using
too many payment services to
ensure they can stay relevant and
can offer the best checkout and
payment experience possible to their
customers
• As a result, payment stacks are
becoming far too complex
Opportunity
• PSPs need to understand exactly
what consumers want today:
• Do consumers want the freedom
to purchase what they want,
when they want, through a
marketplace type system?
• Do consumers want to be able to
conduct the entire buying
experience in a closed
ecosystem?
• WSC believes emerging PSPs must
find the answer to this question and
focus their product development
on facilitating this, as this will be the
key driver behind gaining market
share with merchants
• As well as this, emerging PSPs must
employ similar tactics to the tech
giants and look for more revenue
opportunities outside of payments,
but that will help to drive payment
volumes e.g. supply chain
financing, cash management,
invoicing
Opportunity
• This challenge will continue as
relying on one or two PSPs poses a
significant risk for merchants, given
the lack of global unification of
payment services
• With the introduction of 3D Secure
2.02 in 2020, these risks will only
intensify
• As with any crowded and
commoditised market, there is always
an opportunity to aggregate
• WSC is keen to see start-ups that
have a focus on simplifying the
payment stack through
• Using services similar to real-
time switching solutions in the
utilities and insurance markets
today
• Introducing a middle-layer that
allows merchants to pick and
choose payment methods,
customise payment workflows
and have complete control over
their transaction information in a
simple and intuitive way

Fintech-as-a-Service

Fee-free digital credit
card
(Launched 2019)
by
Back-end commoditisation has led to buying
time to market becoming the preferred option
50
(1) Failory.
(2) CNBC.
Sector Focus: Fintech-as-a-Service
Fintech-as-a-Service (FaaS): An Introduction
42% of banks are engaged with joint partnerships
with fintech companies2
The technology landscape is more alive today than it ever has been. 137,000 start-ups are founded a day1, and
this number has been accelerating since the 1990’s with the rise in popularity of the internet, digital
marketing and the increasing comfort with transacting online. Be it a start-up or a tech-giant like Google or
Apple, competition is at an all time high, and the need for differentiation is forcing companies to enter new and
often adjacent sectors and products, a trend that has been mentioned in this report on numerous occasions.
The more a business understands its customer, the more likely they are to serve them better, no matter the
business, and one of the most intimate aspects of a customer a business can have visibility on is their finances.
Due to this, tech-giants are encroaching into this space, to create additional revenue streams and cross-
selling opportunities through understanding exactly how their customers manages their money.
As well as this, of 137,000 start-ups founded today, a number of these are fintech start-ups hoping to provide
better financial service experiences, but do not have the resources to build the required infrastructure
which has largely become commoditised.
These two trends have opened up a new sector within the infrastructure landscape of fintech called Fintech-as-
a-Service (FaaS). FaaS businesses are providing the entire back-end infrastructure for non-financial and fintech
start-ups to develop financial products and provide embedded financial services through APIs, often without the
need to be regulated as a financial institution. We believe this will be a critical area for the entire technology
ecosystem as fintech innovation continues, and more companies begin to generate revenue directly from
financial services
Seamless and secure
way to pay on Facebook
apps
(Limited launch in select
locations)
by
Financial suite of products,
for Uber drivers including
real-time earnings, current
accounts and credit cards
(Coming soon)
by
Checking account
offered by Google
accessed through
Google Pay
(Coming Soon)
Selected tech-giants working with financial institutions to deploy their own services
Selected fintechs working with FaaS providers

White Star Capital
So far FaaS has had an acute focus on
banking and lending solutions
51
Source: Press, Railsbank
Each of the areas in the tech stack require numerous
integrations with different systems and data types, both
old and new, as well as each of the other areas, quickly
proving the difficultly of building from scratch
There are usually 6 key areas that a Financial Services
tech stack must cover to be successful
FS Stack
Fraud management
Regulatory adherence
Data management
Payment facilitation
Core systems
Licence
FaaS Workflow
Customer
Fintech or
tech
company
Financial Service
Wallets
Current accounts
Credit cards
Insurance
Financing
Ledgers
Money transfer
Payments
FX services
Services
provided
through an API
connection
User
interface
developed
by FaaS
client
Regulatory Adherence
• Every single financial
product abides by a
particular set of regulations
to protect the customer
• Ignoring these guidelines, or
simply not being ignorant of
them can result in fines
Licences
• For a number of financial
products, throughout most
regions, entities would need
licences to offer them
• This can often be a long,
expensive and arduous
process
Core Systems
• This area essentially refers to
the storage directory for the
product that logs, holds and
tracks all information moving
through the system
Payment Facilitation
• For any financial service, the
ability to move money is critical,
whether it is a cash withdrawal, a
payment, claims payout
• Difficulty in building this out
stems from the necessary
relationships required with
financial institutions globally
Data Management
• Particularly through
initiatives like PSD2, finding,
funnelling and structuring
the data necessary to
service your customer will
be a critical aspect of the
product
Fraud Management
• The customer’s money being
handled must be protected at
all costs
• The evolving nature of
financial fraud means this can
be difficult to keep up with
consistently

White Star Capital
These start-ups are enabling some of the largest
financial institutions and neobanks globally
52
$187mraised to date
Selected Investors
Deposit Solutions (Germany) is an open banking platform
providing deposit management services for financial insitutions
Deposit Solutions changed the savings industry by allowing
banks to offer a number of 3rd party savings solutions without
having to set up new accounts
Selected Investors
SolarisBank (Germany) enables both bank and non-bank
businesses to build and offer their own financial services through
its API integration
SolarisBank holds a full banking licence and passporting rights
across all EU regions
Selected Investors
Thought Machine (UK), with core banking system Vault, works
with banks to reimagine new and legacy platforms
Thought Machine’s solution is completely cloud-native, providing
customers with more flexible, efficient and cheaper to maintain
back-ends
$45m raised to date
Selected InvestorsMambu (Germany) is a platform for banking and lending
businesses that already have the required financial licences
Similar to Thought Machine, Mambu’s solution is also truly
cloud native providing similar advantages

White Star Capital
There is a huge opportunity for FaaS for insurance
too
53
Deploying insurance is difficult too
• The Insurance sector is experiencing similar trends to banking and
payments, with digital offerings at the forefront of new start-ups and
traditional institutions agendas
• Insurtech start-ups today still rely heavily on incumbent insurers as explain
in the Insurance section of this report
• As well as this, many tech-giants are also seeing the benefits of being
able to offer insurance solutions to their customers, noticing that the trust
consumers have in their brands can go a long way in creating value
• However taking advantage of this opportunity in many ways can be even
more difficult than its adjacent sub-sectors
Opportunity
• Start-ups currently providing cloud-native insurance specific
infrastructure services, covering all areas of the insurance workflow
from licencing and regulatory consistency across regions, to
distribution readiness will create a significant amount of value for
insurtechs and incumbents looking to reimagine insurance

Regtech

Evolving regulation and growing cyber risk have
made Regtech tools a priority for financial services
providers
55
Source: Pitchbook
(1) Know Your Customer, Anti-Money Laundering, General Data Protection Regulation.
(2) Juniper Research.
Sector Focus: Regtech
Regtech: An Introduction
Regtech has seen an increased focus from investors,
with Europe in particular picking up speed
Regulation technology, or Regtech, refers to solutions relating to regulatory requirements on
companies across 1) data security and transaction monitoring to detect fraud or financial crimes;
2) identity verification and KYC1 and 3) regulatory affairs focusing on rules compliance.
The Regtech boom has its roots in the aftermath of the Global Financial Crisis, with regulators
increasingly imposing stricter guidelines on financial institutions, enacting numerous rules related
to consumer protection, compliance, fraud detection (AML1) and data privacy (GDPR1). In
addition to this, the emergence of new fintech models has contributed to further complications of
the regulatory landscape, pushing regulators to act in a more agile and preventative manner on
new topics such as data transparency and open banking.
Data security and transaction monitoring have also become of utmost importance for financial
services, as they go increasingly software-driven: the resort to the web, the cloud, mobile
applications or the internet of things, aimed to offer increasingly smoother customer experiences and
quicker services, has broadened the attack surface from cyber threats.
The space has seen the emergence of a plethora of players, as financial services companies lack
the expertise, the people, the time, the money or the agility to build solid solutions internally,
and is as topical as ever, as spending on Regtech platforms are expected to increase to $115bn by
2023, compared to $18bn in 20182.
Deal value & volume
$141m $170m
$371m $264m
$452m
$764m $802m
$1,267m
$272m
$110m
$146m
$95m
$211m
$306m
$617m
$120m
$107m
$175m $204m
$487m
$414m
$550m
$992m
$1,166m
$1,971m
$392m
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
50 3961 80 121 125 173 243 231 208

White Star Capital
As the economy becomes increasingly software-
driven, with data volumes soaring, Regtech
solutions become crucial
56
Source: Companies websites, news run, TechCrunch
(1) General Data Protection Regulation, and California Consumer Privacy Act.
There are 3 key factors that have driven this
Privacy
Risk management
Fraud networks
Account takeover
Data
security &
transaction
monitoring
Regulatory
affairs
Lifecycle management
Background check
Tax-related matters
Compliance
Financial
institutions
& fintech Customer
Identity
verification
& KYC
Subscriber info
Device info
Location data
Network activity
Create account, get onboarded, use services through a device
More frequent, diversified
and sophisticated cyber
threats
• The number of cyber attacks
has been rapidly growing, and
increasing their likely entrance
points, from networks, to
applications to transactions,
messaging or the cloud
• The impact on businesses can
be two-fold. 1) Reputationally,
companies that have suffered a
data privacy breach might face a
loss of trust from customers and
consequently increased churn,
2) Business wise, some attacks
might be paralysing, reducing a
businesses’ ability to actually
operate
Liberating financial
services in an increasingly
digitalised economy
• The economy is becoming
increasingly digitalised,
through the shift to online by
established financial
institutions, the spread of
digital-native fintechs, the
democratisation of crypto
platforms and more broadly, the
growing shared-economy
platforms that are connecting
more and more people together
• Virtual identity verification,
regulatory and security tools
have thus become crucial for
financial services providers,
both for recruitment purposes
and employee / customer
management
Quickly evolving regulation
and government support
• Companies must adapt to the
continually changing regulatory
environment, recently reshaped
through privacy laws such as
GDPR and CCPA1, or PSD2,
MiDIF II, Basel III, and Brexit
• Building the expertise and
deploying resources internally
can be costly and time-
consuming, hence the growing
importance of specific providers
in the space
• Governments actions
contributes to this growth, such
as the development of sandbox
programmes in the UK and other
European countries so as to
boost experimentations
Resort to
Regtech
solutions
Collect,
store and
analyse
customer
actions
Regtech players provide companies with the expertise
to navigate the evolving cyber landscape
Online fraud payment

White Star Capital
These start-ups are supporting some of the largest
financial institutions and fintechs globally
57
Selected Investors
Checkr (US) provides a background checks platform
Through its API-first approach, Checkr simplifies the archaic and
manual way businesses run background checks. The solution
provides access to numerous verification sources and can be
plugged into clients’ on-boarding and HR workflows
Selected Investors
Fenergo (Ireland) offers a regulatory software helping manage
client onboarding and lifecycle management requirements
Fenergo simplifies the way large financial institutions navigate
the digital era, helping with regulatory requirements, rolling out
digital interfaces and providing internal-facing services
Selected Investors
Onfido (UK) offers businesses a verification platform intended
to automate the identity verification process
Using AI based technology, Onfido helps to fight personal
identity fraud providing faster, safer and cheaper methods to
identify and verify users
Selected Investors
Shift Technology (France) offers fraud detection and claim
automation
Shift helps insurance players reduce fraud through its AI-
powered detection models that automates claim reviews, which
to date has been a very manual process

White Star Capital
Empowering consumers to control their data and proper
information oversight in a collaborative world
58
(1) Deloitte.
Security in a complex and
ever-changing world
• Companies are struggling to cope
with the ever evolving regulatory
landscape
• Failure to stay on top of this has
resulted in over $350bn worth of fines
over the past decade1
• This is specifically true with privacy-
related regulations
• As well as this, customers have little
control and visibility over the data
they share and how it is collected,
stored and kept safe
Opportunity
• New players have tried to address the
issue through a B2B approach,
helping companies navigate the
changing regulations, while far fewer
have adopted a consumer-focused
perspective
• We believe there is a massive
opportunity for companies aiming to
empower consumers to control their
data, whether it is related to their
actions such as sign-ups, downloads
or purchases, allowed permissions,
banking details or other personal
information
Information oversight in
collaborative environments
• Regulators require strict
communication oversight in well
established financial institutions,
such as trading floors or investment
banking departments
• With the emergence of Unified
Communications as a Service
(UCaaS), companies will likely move
away from standard messaging apps
and diversify into broader
collaboration tools
Opportunity
• We see lots of potential in start-ups
focusing on helping companies
supervise the flow of information
shared through new channels, such
as files transfers, conference calls or
video sessions
• Much has happened around standard
communication channels such as
emails or direct messages
• RegTech leaders will need to develop
adequate technology to help
financial institutions capture data and
provide appropriate compliance
support, in line with regulations

Global Outlook
59

White Star Capital
Defining trends in US include complex regulatory
landscapes and the shift towards cashless society
60
(1) Telegraph.
(2) Yahoo Finance.
(3) Raconteur.
Global Outlook
• Depending on the fintech firm’s activities and the State they operate in, the firm may be
subject to a number of federal and state regulators (e.g. there are 7 federal regulators in
the US)
• As well as this, there is limited governmental support and collaboration compared to
Europe and Asia to help burgeon the fintech sector
• This has created a number of barriers of entry, and hinderances to growth within the US
• Special charters for fintech firms to operate solely under federal law have been
investigated but there has been limited headway in this regard, and will remain a critical
theme underlying fintech progression in the US
State and federal level regulation is proving to be confusing and an obstacle to growth
Non-cash payments represent 45% of all payments in the US1
• Cash continues to be the most frequent method of payment in the US, despite the
unprecedented growth of e-commerce and players like Venmo and Square that have
played a major role in the shift to non-cash payment methods
• This is in contrast to other leading countries around the world
• However there are a number of signs that this is changing, as 50% of US consumers
now report carrying cash less than half of the time2
• As demographics shift, given the younger population, we expect non-cash payments to
increase significantly
Proportion of non-cash payments3
USA:
45%
Singa-
pore:
61%
Sweden:
59%
Nether-
lands:
60%
France:
59%
UK: 52%
Canada:
57%

Source: News press.
(1) Forex Business as of 2015.
Global Outlook
• Credit cards are the most popular form of non-cash payment methods in North America,
compared to Europe given the differing views of credit, particularly after the global
financial crisis
• North Americans are more comfortable with the concept of credit, understanding the
potential benefits of increased purchasing power, rewards, benefits and consumer
protection compared to using debit cards
• Due to this, it is evident as to why the consumer lending landscape in North America is
booming, consistently receiving the highest amount of investment as a share of total
fintech funding
• As digital banking initiatives like Chime and Dave grow and step to the forefront in the
North America, how these players navigate the credit card world will be critical for
future success
The average American and Canadian statistically have 2.9 and 2.2 credit cards, and
less than 1 debit card respectively
2.9
2.2
1.0 1.0
0.9
0.7
0.3
0.2
0.1 0.1
0.9
0.7
1.0
1.8
1.5
3.3 3.3
1.4
0.7
1.3
US Canada Sweden Australia UK Japan China Russia France Germany
Credit Cards per Capita Debit Cards per Capita
Card type per capita1
Views towards credit are most positive in the US, with one of
the highest credit card incidence rates globally

White Star Capital
Canada presents a fertile ground for fintech leadership
62
Source: News press.
(1) Source: CBInsights.
(2) Includes Finance, Insurance and Real Estate Rental and Leasing, as of March 2020. Source: Government of Canada Statistics.
Global Outlook
Canada is currently in the process of launching open banking initiatives similar to
Europe
• The Standing Senate Committee on Banking, Trade and Commerce has tabled a report
calling for decisive implementation of the open banking framework by the Federal
Government
• Canadian fintechs are currently forced to use screen scraping technologies that
leave consumers vulnerable to data breaches
• Open banking is expected to provide more choice and improved financial
products for Canadian consumers, and keep Canada internationally competitive
• The government’s open banking review, which was first introduced in the 2018
budget, entered its second phase in January 2020. However, the consultation has
since been delayed until at least autumn 2020 due to the global pandemic
• Other proposals contained in the 2018 budget include the modernisation of the deposit
insurance framework and an innovative retail payments system
With a strong and stable financial ecosystem, increasingly forward thinking
incumbents and regulators, prolific tech talent and savvy customers, Canada will
present a fertile ground for fintech leadership in the coming years
• The Canadian fintech ecosystem has seen significant expansion in the last 5 years with a
surge of capital available to founders at all stages (+104% YoY in 2019 up to $776m1),
showing growing interest from local and international investors
• Financial services account for 21% of the Canadian economy2 and the ecosystem relies
heavily on archaic infrastructure. We see this as a huge opportunity for players working to
modernise it
• Payments continues to lead all other categories, with Vancouver as a flagship hub
Selected start-ups Fintech
focussed funds
Other notable
fintech investors
Borrowell
Consumer Lending
Total Raised: $72m
Finn AI
AI / personal banking
Total Raised: $14m
Bench
SME accounting
Total Raised: $49m
Mylo
Wealthtech
Total Raised: $11m

White Star Capital
Brexit, PSD2 and prevailing negative interest rates
continue to set the backdrop for European Fintech
63
Source: Barclays, PYMNTS.
(1) With their explicit consent.
Global Outlook
• A dwindling talent pool and an inability to passport services throughout Europe
from the UK are some of the main concerns associated with start-ups in the UK following
Brexit
• For fintech in particular, the question remains, “Will the UK hold on to its title as a
global hub for Fintech, or will other regions in Europe start to play more of a role?”
• However it is expected that as large institutions move assets to mainland Europe, and
other regions see an opportunity to take market share, Brexit will create a number of
new opportunities throughout Europe
The impact of the UK’s departure from the EU is still unclear
As the follow-up to PSD1, PSD2 was meant to further establish a single market in
Europe for payments, stimulating competition and improving the quality of services
• PSD2 enables non-bank entities to manage financial transactions, forcing increased
transparency of services and fees, and accelerating SEPA (Single European Payment
Area), leading to faster and cheaper payments Europe-wide
• It also enabled new services, such as Payment Initiation Service Providers (PISPs,
enable the transfer of money directly from bank accounts, rather than through payment
card providers) and Account Information Service Providers (AISPs, aggregators of
customer payment account information)
• This has enabled Open Banking in the UK, where the British government was able to
require by law, that the UK’s 9 largest banks must provide companies with access to
an individual or SME’s account data1
• This in turn allows individuals, lenders, and new financial institutions to automate manual
and complex tasks and instantly collect and view data on bank transactions, opening up
new doors for innovation
• So far, the response from the industry on PSD2 has been mixed, largely due to the tight
deadlines and limited guidelines, banks have fallen short of implementing this
• How PSD2 develops, and whether it will play a major role in the European fintech
landscape remains to be seen but we remain vigilant

White Star Capital
Brexit, PSD2 and prevailing negative interest rates
continue to set the backdrop for European Fintech
64
Source: Barclays, PYMNTS, European Central Bank.
Global Outlook
• Amidst competition concerns, Visa and Mastercard were forced to significantly
decrease their interchange fees in the EEA
• As this interchange fee was being shared with fintech players, it has impacted start-ups
ability to monetise their users relative to their US counterparts
• The cap has been widely regarded as successful by customer groups, however card
issuers have managed to find new ways to increase fees and this is causing many start-
ups to develop off-rail solutions
In April 2015, the European Commission made commitments by Mastercard and Visa to
reduce interchange fees by c.40% for payments in the EEA binding
• The reduction of interest rates to near zero following the global financial crisis, and then
to sub-zero years after, impacted major financial institutions through Europe, banks and
insurers alike
• The spread that these incumbents made on lending is now no longer enough and it has
forced many of these businesses to innovate to improve their margins through
diversification of revenue streams
Following an extended period of low inflation and weak economic growth, the ECB
resorted to negative interest rates to stimulate the European economy
-0.3%
-0.1%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
EURIBOR rate evolution 3 month 12 month
Negative rates since 2015-16

White Star Capital
Japan and South Korea benefit from supportive
government programs and regulation
65
Source: Barclays, PYMNTS.
(1) With their explicit consent.
Global Outlook
• Japan was historically held back by difficulty and opaqueness in obtaining banking
licenses and an environment that favours the use of legacy technologies
• However, over the last two years the Government of Japan has become increasingly
supportive, presenting incentives to promote technological innovation such as:
• Removal of Financial Services Agency approval requirement to acquire an
interest (>15%) in nonfinancial companies - banks will only need to report said
investments to the FSA
• Changes to the country’s Banking Act have made it easier to incorporate APIs,
allowing for a wider range of technology-based financial products and services,
particularly in payment services, long dominated by big banks with considerable
barriers to entry
• Japan has been at the global forefront of cryptocurrency regulation, as the first
country to provide a legal framework for Bitcoin and create a licensing regime for
cryptocurrency exchanges in Apr-17. The FSA proposed amendments to the PSA and
FIEA to strengthen the protections for investors in crypto assets went into effect in May-20
• As a result Japan is now the largest market for bitcoin with 23 approved exchanges.
Many of them are beginning their international global expansion led by players such as
bitFlyer, Quoine, GMO and DMM
Japanese Government support is starting to show its results particularly with the
proliferation of cryptocurrency
• In 2019, the FSC began a major review of >200 fintech regulations including:
• Amendments to the Supervisory Rules on Electronic Financial Transactions
(effective Jan-19), allowing cloud adoption to process critical financial information
• Amendments to the Finance Innovation Act (effective Apr-19) creating a
"Regulatory Sandbox" allowing regulatory exemptions for fintechs and other
favourable initiatives
• Fintech has been identified by the South Korean Government as one of the top priorities
for 2020, setting aside a budget of US$16m to support the sector, (~2x YoY), with
further developments in Open banking, MyPayment and MyData expected this year
• The rapid growth of P2P lending start-ups to tackle the unbanked population has come
under scrutiny recently due to elevated delinquency rates and allegations of fraud
involving some renowned fintech players
• The National Assembly’s “P2P Act”, coming into effect on Aug-20, will require P2P
lenders to disclose any financial incidents, delinquency rates of 15%+ and sales of bad
loans, while high-risk financial instruments will be banned for these companies
South Korea’s government is now pushing sweeping regulatory changes, setting up
Korea for fintech innovation leadership

White Star Capital
Southeast Asia is following in China’s footsteps with their
own Super Apps, supported by forward thinking regulators
66
Source: Pitchbook, News press.
Global Outlook
• The explosive growth of mobile, internet and e-commerce penetration has led to the
rise of Grab and Go-Jek, now the most valuable unicorns in SEA
• Heirs of their Chinese counterparts (e.g. WeChat), they are also expanding into fintech-
related services such as e-wallets and mobile payments. Grab has now built the largest
payment ecosystem in SEA
• Competition concerns and the power they will have to either stifle or encourage
innovation will shape the development of the start-up ecosystem in SEA
The future of Super Apps in SEA
Regulatory bodies are focused on ensuring fintech can thrive while protecting consumers
• Bank of Thailand and the Ministry of Finance launched the Payment Systems Act in
2018 to align regulations with international standards in efficiency, safety and security
• In 2019, the Monetary Authority of Singapore (MAS) reviewed the e-payments user
protection guidelines, requiring all banks and fintechs to notify users of all their e-
payments, provide a reporting channel for claims, and assess all claims while providing a
reasonable effort to recover the money
• Personal data protection frameworks are being employed throughout the region too as
SEA countries have become increasingly connected between themselves, and the rest
of the world, particularly with the implementation of CBPR, the SEA equivalent to GDPR
Indonesia
Valuation: $9.5bn
Total Raised: $6.3bn
Singapore
Valuation: $14bn
Total Raised: $10.3bn
Singapore has followed in Hong Kong’s footsteps with the launch of its digital-bank
only licences
• In 2019, MAS announced its digital
banking licence initiative, which will
allow entities without banking parents
to perform banking activities
• The aim is to encourage serving the
underserved and establishing
Singapore as a fintech hub for SEA
• MAS announced they will issue up to 5
licences, that can graduate to a full
banking licences in time
• Licences will be issued in mid-2020,
and other countries in the area are
expected to follow suit
Selected applicants

Partnering with White
Star Capital
67

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