Berlin The accolade took place in autumn 2017. The Federal Ministry of Economics (BMWi) had chosen Finleap under its boss Ramin Niroumand as a digital competence center for fintechs. Symbolically, the fintech holding company moved to the former headquarters of the Berliner Bank near Bahnhof Zoo.
With this, the BMWi and the state of Berlin recognized the rapid development that Finleap had taken since it was founded. In 2014, Jan Beckers and his partner Niroumand came up with the idea of founding a fintech forge – an incubator for start-ups that pursue digital business models in the financial sector. Finleap collected capital from institutional investors and invested 500,000 to 5 million euros in start-ups.
In a way, this idea was also due to necessity. “You could count on one hand the experts that were in the fintech sector at the time,” recalls the business IT specialist, who previously worked as a senior consultant at Deloitte and as an innovation manager for the BayernLB subsidiary DKB. There was also a lack of courage for entrepreneurship. However, there was a great need for fresh ideas and new technologies in the financial sector. Therefore, several companies with different business models were set up with the limited talent pool.
The success speaks for itself. A total of 15 companies were launched with an estimated portfolio value of around three billion euros. Experts estimate Finleaps’ share at around 25 percent. The value of the portfolio is driven by companies such as Solarisbank, which after the recent capital increase is considered a unicorn, i.e. a company whose value has exceeded the one billion mark.
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The insurance manager Clark, the digital debt collection service provider Pair Finance, Elinvar, the digital platform for asset management, and the Insurtech Element have also developed very successfully. Another important holding is the online business bank Penta.
Finleap consolidated Berlin’s reputation as a fintech stronghold
There weren’t any flops. The comparison platform for financial services, Joonko, was discontinued after a failed round of financing. The bottom line is that Finleap’s commitments made a significant contribution to Berlin’s reputation as a fintech stronghold. The position was further strengthened by the presence of the smartphone bank N26, the online broker Trade Republic, the core banking specialist Mambu and the investment platform Weltsparen/Raisin.
According to Niroumand, Finleap’s business purpose has been fulfilled after eight years – after all, an incubator only makes sense if an industry is just starting out. However, the Berlin fintech scene has now grown up. The infrastructure companies founded by Finleap already offer new founders the ideal basis. In a later market cycle, the companies that are good would have to become even better. But that is not the focus of Finleap. However, Niroumand is happy to help out with his experience – for example as Chairman of Solarisbank.
But the activities of the native Berliner will not end with the management of company shares and, if it is opportune, possible sales. Incidentally, his father, Kamyar Niroumand, came to Germany from Iran at the age of 13 and was, among other things, Germany head of Software AG.
In the future, Niroumand junior will take care of his new fund. The fund for early-stage financing was christened “Embedded Capital”. “In the future, we will be active as an early investor, from inception to Series A, so to speak, within the first 18 months,” explains Niroumand. Similar to Finleap, the respective commitments will also range between 500,000 euros and five million euros and will be focused on fintechs.
Fintechs can still digitally optimize many processes
Niroumand sees many more opportunities, especially in the corporate sector. “The heart of our economy is the middle class. And fintechs can still digitally optimize many processes – from money laundering prevention to cash flow analyzes in real time to the use of artificial intelligence,” says Niroumand. “We can now use the experience that we have as entrepreneurs – with all the ups and downs – as investors.” Years ago, he ruled out exactly this step. “I don’t see that we as a company builder will ever become a venture capital investor,” was the earlier assessment. Times change.
Niroumand does not want to say anything about the volume of the fund – but a three-digit million volume is considered likely. In any case, the manager will hold the majority of Embedded Capital, which will be joined by other investors, preferably likely Finleap investors. “It didn’t go that badly,” adds Niroumand with a laugh. His former partner Jan Beckers is also likely to be one of the donors.
Embedded Capital has already made its first commitment. The early-stage fund has invested in Pliant, a provider of digital corporate credit cards – based in Berlin.
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