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M1 Finance closes $45M Series C mere months after it raised its $33M Series B

M1 Finance closes $45M Series C mere months after it raised its $33M Series B

Just months after it announced a $33 million Series B, Chicago-based M1 Finance today disclosed a $45 Series C.

The new financing event was led by Left Lane Capital, the same investor that led M1’s Series B. Bear in mind that so-called inside rounds are now a bullish sign in 2020, as opposed to in prior VC eras when they were viewed more cooly. Other M1 investors include Jump Capital, Clocktower Technology Ventures and Chicago Ventures, though only the first two appear to have taken part in this round.

Per M1, the Series C comes just 120 days after it raised a Series B. A good question is why M1 has raised more capital, and why Left Lane Capital wanted to lead two rounds for the consumer-focused fintech provider. Going back to our prior coverage, we can figure it out.

In February, we reported that M1 Finance had reached the $1 billion assets under management mark, or AUM.

The startup combines three different traditional fintech services into one (roboadvising, neobanking and lending), allowing it to price the package aggressively. The model appears to be working. When M1 raised its Series B a few months later in June, it had reached the $1.45 billion AUM, or about 45% growth in just over a quarter. That’s very good.

Today, the company announced that it has surpassed the $2 billion AUM mark, up more than 38% in the last four months.

M1 posted slower AUM growth in percentage terms and greater growth in raw AUM over a similar time frame heading into its Series C. But regardless of that nuance, the company’s AUM grew quickly.

That fact helps explain its new round. If you were Left Lane Capital, had just led a round into the company, and then watched it keep growing rapidly,

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The Finance 202: Joe Biden’s tax plan would barely dent growth, conservative group finds

The Finance 202: Joe Biden’s tax plan would barely dent growth, conservative group finds

The analysis concludes Biden’s plan would raise $2.8 trillion over the next decade from higher taxes on businesses, corporations and the wealthiest households. Over that time, AEI projects the higher taxes would reduce economic growth by a relatively modest 0.16 percent.

The plan would “make the tax code more progressive,” AEI’s Kyle Pomerlau and Grant Seiter write. And after slightly crimping growth in its first decade, it would “reduce debt-to-GDP in the second decade, leading to slightly higher GDP. However, in the long term, his plan would not raise enough to stabilize debt-to-GDP and would lead to a 0.18 percent smaller economy.”

The macroeconomic drag the AEI model anticipates roughly aligns with other analyses from the Tax Foundation and the Penn Wharton Budget Model, Pomerlau notes. In other words, rolling back most of the Trump tax cuts wouldn’t bring about the economic Armageddon the Trump campaign has depicted.

Neither would it jack up taxes on every American. 

Vice President Pence made that claim during his debate with Sen. Kamala Harris (D-Calif.),  Biden’s running mate, last week. The AEI analysis finds the top 1 percent of taxpayers would see a 14.2 percent hit to their after-tax income next year. The rest of the top 5 percent would face a small uptick in their burden. But everyone else would receive an after-tax income bump. The largest such increase, of 11.3 percent, would go to the bottom 10 percent, thanks to a temporary expansion of the child tax credit, according to AEI.

The analysis finds that starting in 2030, the Biden plan would impose “modest” tax hikes on the bottom 95 percent of earners, which it attributes to higher taxes on businesses. That would appear to violate Biden’s pledge not to raise taxes on anyone earning less than $400,000

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Car finance market up slightly in August despite drop in demand

Car finance market up slightly in August despite drop in demand

The consumer new car finance deals agreed in August were worth more than £1bn,

The UK consumer car finance market grew slightly in August despite a decline in the overall new car market, according to new figures. Data from the Finance and Leasing Association (FLA) showed a small increase in the number of cars acquired by private customers using finance deals.

Over the course of the month, private consumers agreed finance deals on almost 178,000 cars, up one percent on the same month in 2019. In total, FLA members dished out more than £2.7 billion in advances – an increase of eight percent on August last year.

The lion’s share of the growth was found in the used car market, where private customers acquired some 128,126 cars on finance last month. That’s a two-percent increase on the same period in 2019, but the value of those deals shot up by a massive 10 percent. As a result, the total value of advances came to £1.67 billion.

More on the car finance market:

The new car market saw more modest results, with the number of cars acquired on finance fell by one percent to just over 49,500. That is, perhaps, no surprise given figures from the Society of Motor Manufacturers and Traders (SMMT) showed a drop in new car sales of almost six percent during August.

More surprising, though, is that the value of advances still rose by five percent to hit £1.04 billion, despite the doom and gloom surrounding the market. But figures also show finance deals have accounted for around 93.5 percent of new car sales in the past 12 months.

New cars in car dealership showroom

But with the impact of coronavirus, the lockdown and the current economic uncertainty shrouding the country and the car industry, the

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Personal finance advice relies on shame; what if we tried empathy?

Personal finance advice relies on shame; what if we tried empathy?

When June applied to be on the Suze Orman show in 2012, she was a young doctor making $58,000 a year with $240,000 in student loans from medical school and $40,000 in credit card debt. As a divorced mother with three children, who was also caring for a terminally ill parent, June’s income barely covered her living expenses. When a friend suggested that she apply to be on the Suze Orman show, June agreed; she wasn’t familiar with the show but figured it couldn’t hurt to get some professional advice. 



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@outlandvideography via Twenty20

Initially, her experience with the show producer was positive. The producer told June that she was working so hard and she was exactly the kind of person Suze wanted to help. 

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That’s why she was so surprised when Orman, one of the most well-known faces in the personal finance industry, started off by telling June that she shouldn’t have gone to medical school. Orman then advised her to declare bankruptcy, questioned if she should buy her children Christmas presents, implied that June was spending money on her children to make up for her guilt over the divorce, and said that June’s 16-year old child needed to start working to help take on the responsibility of June’s debt. 

“Tell them the situation you have gotten yourself into.” Suze yelled. “Let them see the reality of when you are irresponsible with facing the truth — what it can cause.” 

This advice may seem shocking, but most traditional money advice is built on shame, often packaged as tough love and personal responsibility. In a shame-based framework, financial stability is accessible to everyone. Certain financial decisions are positioned as entirely positive, such as homeownership and 529 education savings plans, while other financial decisions are considered

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Blackstone-Backed Finance Of America Plans $1.9B SPAC Merger To Go Public: WSJ

Blackstone-Backed Finance Of America Plans $1.9B SPAC Merger To Go Public: WSJ



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The Blackstone Group Inc (NYSE: BX)-backed Finance of America Equity LLC is planning to go public through a merger with a blank check company, the Wall Street Journal reported Monday.

What Happened: The consumer-lending platform is expected to merge with special purpose acquisition company Replay Acquisition Corp (NYSE: RPLA) in a deal that will give it a valuation of $1.9 billion, people familiar with the matter told the Journal.

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Institutional investors would reportedly make a private investment of $250 million in Finance of America as it goes public.

The deal is expected to leave Blackstone with 70% ownership of the company.

The consumer lender was originally considering going public through an initial public offering but began negotiating with the founders of Replay Acquisition in the summer, the Journal reported.

Why It Matters: Finance of America’s services span mortgages, reverse mortgages, commercial-real-estate loans, and fixed income investing.

The flurry of activity around SPACs continues unabated. Last month, United Wholesale Mortgage, the biggest wholesale mortgage originator in the United States, was reported to be considering a merger with the blank check company Gores Holdings IV Inc (NASDAQ: GHIV) at a record valuation of $16.1 billion. 

Japanese conglomerate Softbank Group Corp (OTC: SFTBY) is also preparing to launch a SPAC in two weeks’ time as it remains flush with liquidity. 

Chamath Palihapitiya’s three SPAC firms raised $2.1 billion IPOs, last week. 

This month, Los Angeles-based Fisker Inc, an EV startup, is expected to go public by merging with Spartan Energy Acquisition Corp (NYSE: SPAQ).

Price Action: Blackstone Group shares closed almost 0.5% higher at $54.97 on Monday. On the same day, Replay Acquisition shares closed nearly 0.2% lower at $10.26.

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