Innovate Financial Health (IFH), a nonprofit that aims to support technology that improves financial health, has been acquired by another nonprofit, Montréal-based Fintech Cadence.
As part of the agreement, Fintech Cadence has absorbed IFH’s team and the management of the IFH Lab, which is IFH’s startup program. IFH will be dissolved as an entity and IFH’s main funder, JP Morgan Chase, will now direct funding to Fintech Cadence. The founder and managing director of IFH, Elvis Wong, has joined as Fintech Cadence’s director of financial health.
“This acquisition will expand our capacity and resources to support startups tackling some of the most pressing financial challenges.”
“Joining Fintech Cadence allows the IFH Lab to take advantage of Fintech Cadence’s incredible expertise, diverse network of industry experts, and deep partnerships with financial institutions, regulators, governments, and more,” Wong told BetaKit in a recent interview. “Most importantly, this acquisition will expand our capacity and resources to support startups tackling some of the most pressing financial challenges facing Canadians today.”
Founded in 2017 by Jan Arp, who is now the founding managing partner at Holt Fintech Accelerator, Fintech Cadence runs three programs targeted toward FinTech startups: Ascension, a FinTech incubation program; the Formathon, a FinTech competition; and a 12-week FinTech certificate program.
Fintech Cadence claims it has supported over 100 early-stage startups that have gone on to raise more than $3.5 million, cumulatively. Though not exclusively focused on financial health, Fintech Cadence said the deal will help the organization better support impact-driven FinTech companies within the financial health vertical.
Following the deal, Fintech Cadence now has a foothold in the Toronto market. According to Montreal in Technology, the nonprofit is also working to partner with innovation organizations in Alberta, Saskatchewan, British Columbia, and Atlantic Canada.
“Fintech Cadence started four years ago with the aim of developing the fintech ecosystem from the grassroots level,” said Layial El-Hadi, executive director at Fintech Cadence. “Now, we are at a point where we need to not only elevate Montreal or Toronto, but bring the fintech industry across Canada together.”
The deal is part of Fintech Cadence’s larger national expansion strategy, as the startup looks to better support the growth and acceleration of more Canadian FinTech startups.
A spokesperson from Fintech Cadence told BetaKit, Fintech Cadence supported the IFH team early last year when IFH launched its first program. The acquiring organization provided IFH with advice and lessons learned as part of that support.
“Following this, both organizations connected during Fall 2020 and realized that a union of their organizations would help increase impact, scale both organizations as well as further unify the two major cities in the Canadian Fintech ecosystem,” the Fintech Cadence spokesperson added.
IFH was founded in 2018 out of the MaRS Studio Y Fellowship program. IFH Lab is a six-month program for six startups that work on financial health-related tech solutions.
IFH Lab has a key focus on startups building solutions for financially vulnerable Canadians, such as newcomers to Canada. IFH’s alumni startups include altruWisdom, PolicyMe, Quber, and ZayZoon. The next cohort of the IFH Lab will run from May to October and applications are currently open.
Financial health refers to the state of one’s personal monetary affairs and can be relevant to individuals and organizations. The space has been prominent in Canada over the last year, thanks in large part due to the COVID-19 pandemic and resulting economic crisis affecting thousands of individuals and businesses.
The MNP Consumer Debt Index indicated in March that since the onset of the pandemic, half of Canadians have reported they are $200 or less away each month from insolvency. Data from the Canadian Federation of Independent Business last year reported that 48 percent of small businesses are making half or less their normal sales at the time.
IFH was not the only program to run a financial health-focused program last year. Highline Beta and Intuit Canada launched their own financial health-focused accelerator. That program, called the Intuit Prosperity Accelerator, accepted eight startups into its first cohort, some of which include Toronto-based Willful, Toronto-based Homewise, and Edmonton-based Dryrun.
Image source Innovate Financial Health.