Better Tomorrow Ventures Closes $140m, Remains Bullish On Fintech

Sheel Mohnot, co-founder and wide partner of Better Tomorrow Ventures (BTV) has 1 elemental reply for anyone claiming that investing successful fintech has mislaid immoderate of its attractiveness.

“The world of finance is huge. About 20% of world GDP is financial services, and it’s still not integer enough,” he told TechCrunch.

Many financial transactions are still handled manually, and Better Tomorrow Ventures—led by Sheel Mohnot (a erstwhile wide partner astatine 500 Startups) and NerdWallet co-founder Jake Gibson—aims to thief alteration that.

“The monolithic digitization opportunity is still up of us,” Mohnot told TechCrunch. The firm’s constricted partners look to agree.

Better Tomorrow Ventures conscionable raised $140 cardinal 2nd fund, astir matching nan $150 million 2nd fund, which was announced successful early 2022 toward nan extremity of nan ZIRP boom.

“We really planned to make nan money smaller this time,” Mohnot said. “In 2021, things went ace overboard. Every institution we invested successful instantly raised a follow-on information astatine a crazy price, and that was astir apt bad,” Mohnot said.

Now that nan enthusiasm for fintech is tamer, BTV doesn’t request arsenic overmuch superior to proceed to participate successful its champion startups, he explained.

The patient besides didn’t pat into nan $75 cardinal opportunity money raised on broadside its 2nd money successful 2022. But that superior whitethorn travel successful useful astatine immoderate constituent soon. Since galore of nan caller and planned IPOs are successful nan fintech space, including Chime, Klarna, Navaan, and Wealthfront, there’s dream that late-stage investors will go much excited astir nan category.

At nan early stages, fintech investing has surely picked up complete nan past year. For instance, BTV sees awesome opportunities successful disrupting accounting.  

“There’s a monolithic shortage of accountants. Accounting firms are each turning distant business, and it’s a cleanable exertion for AI,” Mohnot believes.

The patient has already backed 3 accounting startups: Basis, which precocious raised a $34 cardinal Series A led by Khosla Ventures; an embedded accounting level for mini and medium-sized businesses Layer, and InScope, a startup that helps automate audited financial connection drafting.

But it’s not conscionable accounting: Mohnot is simply a beardown believer successful AI’s wide applications wrong fintech. “Financial Services is very labor-intensive. There’s underwriting, compliance, beforehand detection, customer support,” he said. “AI tin do each that astatine a little cost.”

Other notable companies successful BTV’s portfolio see Coast, a payments level for fleet and motortruck drivers, and Relay, an online banking and rate guidance level for mini businesses.

For its 3rd fund, nan patient plans to put successful 30 to 35 companies, pinch cheque sizes ranging from $500,000 to $3.5 million.