Goldman’s investment doesn't come from the bank—it comes from a $1.25 billion fund it raised last year. This is the third investment New York-based Goldman has made from that fund in 2016, having made nine investments in 2015. The latest funding efforts by the bank benefited Spotify Ltd., Pinterest Inc., and thredUP Inc. Plaid’s previous investors before this Series-B round included Google Ventures, New Enterprise Associates Inc., Spark Capital, and BoxGroup. Those firms also participated in this funding effort.
Plaid allows customers to send their financial data to other companies, such as Betterment LLC, Acorns Advisers LLC, Venmo Inc., and Robinhood Financial LLC. Those firms are then able to know client balances and authenticate accounts. So if a customer wants to set up an investment account at Betterment, they can connect their bank account within Betterment's website or app, so Plaid's technology can make it more seamless for both parties.
While the broader startup world has continued to struggle, with little in the way of initial public offerings and a number of financings at lower valuations, fintech has generally been a bright spot. According to a report from KPMG International Cooperative and research firm CB Insights, funding to this market is poised to hit a record this year.
Fintech has seen its fair share of bad news, however, with the abrupt firing of LendingClub Corp. CEO Renaud Laplanche, the ensuing 50 percent fall in the company’s shares, and poor stock performance from On Deck Capital Inc. This hasn’t stopped the likes of Goldman and other investors from continuing to look into the arena, though. They just might have to look a bit more carefully.