Services/Finance/Analysis/ Paypal wants to partner with European fintechs The new strategy of Paypal makes it possible for small European fintech startups to reach new markets. Swedish startup Tink is already there. By Mimi Billing 4 June 2019 Credit: Paypal is starting a new partnership with startup Tink. Credit: Paypal is starting a new partnership with startup Tink. \Startup Life 6 tips for using data to grow your startup By Tom Ritchie 18 March 2021 Services/Finance/Analysis/ Paypal wants to partner with European fintechs The new strategy of Paypal makes it possible for small European fintech startups to reach new markets. Swedish startup Tink is already there. By Mimi Billing 4 June 2019 A year ago Paypal acquired Swedish fintech Izettle for $2.2bn. Today, the US payments giant has come back to the continent with a strategic investment in another Swedish financial startup, Tink. The nature of the move — Paypal is investing €10m in Tink — is clearly different in scale from the Izettle acquisition. But it could potentially be the start of more such partnership deals in Europe, which would be a boost for the sector. “This is obviously fantastic. It is exciting what the two of us can do together and then Paypal is an icon in our industry,” Tink cofounder Fredrik Hedberg says to Sifted. Daniel Kjellén and Fredrik Hedberg founded the fintech company Tink in 2012. Tink started off as a consumer app in 2012, helping customers to keep track of their personal finances, but has since then pivoted to licence its platform to banks and other fintech players. Apart from the shares that Paypal now owns in Tink, the partnership will mean that Paypal will use Tink’s platform to pull third party bank data to improve product experiences for Paypal customers. Partnership vs acquisition This kind of strategic partnership speaks to an apparently slightly different focus for Paypal. After Izettle, Paypal has invested in a number of companies with a view to partnerships. In March of this year, Paypal invested $750m in the South American e-commerce company MercadoLibre. Apart from the dividends from the investment, some sort of partnership between the two companies is expected. Read more: How Tink raised capital from banks but kept its independence In April, Paypal invested $500m in Uber which was described by the partners as a deal that would help “future commercial payment collaborations”. The difference is that Tink does not offer 200m users like MercadoLibre or a huge global transportation platform like Uber. Could this be the first step in the acquisition of Tink? “I really don’t hope so. This is far too much fun to be acquired”, says Hedberg. “Paypal is like an icon in fintech.” It’s possible that there is now an opportunity for a number of fintech SaaS startups in Europe in partnering with Paypal. Tink, with its partnerships with banks like British Natwest, Dutch ABN Amro and a number of Swedish banks including Klarna, has proven that pushing out its open banking platform across a sector is possible. The strategic partnership between Paypal and Tink will start in Europe, to begin with. And although no talks of an acquisition have been held, according to Hedberg, if Paypal would like to take Tink’s services in-house, they have the muscles to do it. Want the best of Sifted in your inbox? Our newsletter brings you the latest, greatest stories on startup Europe. Sign up Terms of Use Related Articles Clubhouse has revealed the German tech scene’s lack of diversity By Miriam Partington in Berlin Click here to read more A third of UK unicorns founded by ethnic minorities By Kai Nicol-Schwarz Click here to read more Not everyone can become an entrepreneur in Europe By Marie Mawad in Paris Click here to read more Only 21% of tech unicorns are led by women, report shows By Freya Pratty Click here to read more Get the best of Sifted in your inbox By entering your email you agree to Sifted’s Terms of Use Sign up to \Future Proof Sifted’s weekly \Corporate Innovation roundup email By entering your email you agree to Sifted’s Terms of Use Most Read 1 \Deeptech Europe is making faster cars and better batteries than Tesla 2 Member \Startup Life Enter the era of the digital nomad 3 Member \Fintech Index to miss out on Wise IPO bonanza after quietly cashing in stake 4 \Fintech UK fintech Freetrade mints millionaires out of early crowdfunding investors 5 Member \Venture Capital The 28 Italian startups to watch, according to top VCs Join the conversation Subscribe Notify of new follow-up comments new replies to my comments
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