Mobile Banking And Payment Startup mFoundry Sold To FIS For $120M On $165M Valuation

Some consolidation in the world of mobile payments and mobile banking: mFoundry is getting acquired by FIS for $120 million. FIS — a banking and payment provider that works with some 14,000 banks worldwide — already had a 22% stake in the company; today’s deal will see it paying for the remaining 78% in cash, for a total valuation of $162-$165 million. mFoundry provides mobile banking and mobile payment solutions to some 850 banks and retailers, including Bank of America and Starbucks, which uses some of mFoundry’s technology to enable mobile payments, which complements the partnership that Starbucks has with Square.

The valuation includes cash in reserves at mFoundry as well as stock options, TechCrunch understands. The deal is expected to close between two and four weeks and may see further final adjustments in price.

Investors in mFoundry included companies like GRP Partners,Intel, Motorola and MasterCard; in total, the company had raised $40.3 million since being founded in 2004. Not quite a young startup, then, but given the advances in mobile services with the growth of smartphones, its business had grown quickly in more recent years. More recently, the company started to make moves to work closer with some of the more disruptive players like Dwolla to enable peer-to-peer mobile payments via people’s banks.

Just as mFoundry was looking to get closer to the latest changes and trends in banking, so too is publicly-traded FIS trying to buy into more innovation:

“mFoundry has a well-earned reputation for innovation, powerful vision and agile development,” said Gary Norcross, FIS president and chief operating officer in a statement. “Consumers have adopted the mobile channel faster than any other delivery channel in existence, and delivering industry-best mobile solutions is a vital focus area for FIS.”

The acquisition also gives FIS a stronger foothold into tapping into Silicon Valley to do that — with mFoundry based out of Larkspur in Marin County, CA, and San Francisco, while FIS is in Jacksonville, FL.

Although mFoundry had secured some lucrative partnerships and has been on a growth trajectory, it’s operating at a time when there are a number of players in the mobile payments and banking space, including biggies like PayPal as well as startups that have ballooned in size, like Square, that may themselves eventually move to IPO. Alongside those have been many smaller companies, from regional payments companies like iZettle. So, as the industry continues to mature, there is bound to be some consolidation — in particular by more closely aligning what’s happening on the mobile side with wider banking and payment processes.

At the same time, the company was not for sale, TechCrunch understands, although it had been getting a lot of inbound interest from companies that also compete against FIS, including a “strong player from Europe.”

“There was a surprising number of large global IT providers were interested in taking a look at mFoundry,” said Brian McLoughlin, a partner at GRP Partners.

No comment on consolidation or the state of the market for mFoundry from Drew Sievers, co-founder and CEO of mFoundry, except to note that “the timing was right for us to combine forces.” What it will mean is that now FIS will be able to offer its current banking customers more mobile services, by way of mFoundry’s solutions, as well as give FIS a route to targeting more retailers with combined online/mobile banking solutions.

Full release below.

JACKSONVILLE, Fla., Jan. 31, 2013 – Expanding on its leadership position in mobile financial services, FIS™ (NYSE: FIS), the world’s largest provider of banking and payments technology, today announced it has signed a definitive agreement to acquire the remaining 78 percent interest in mFoundry, a foremost provider of mobile banking and payment solutions for financial institutions and retailers. Previous to this transaction, FIS held a 22 percent interest in the company. The addition of mFoundry creates one of the leading mobile entities in the financial services space and enables FIS to leverage its technology assets across a broader client base.

“mFoundry has a well-earned reputation for innovation, powerful vision and agile development and delivers one of the most advanced mobile platforms in the market today,” noted Gary Norcross, FIS president and chief operating officer. “Consumers have adopted the mobile channel faster than any other delivery channel in existence, and delivering industry-best mobile solutions is a vital focus area for FIS. Our goal is to provide the solutions that underpin an organization’s ability to best reach and serve its customers, and the addition of mFoundry plays a key role in that strategy.”

Founded in 2004 and serving more than 850 clients, mFoundry’s customer-focused solutions have become a leading platform for mobile banking and mobile retail and have been adopted by some of the largest banks, credit unions, payments processors and retailers in the country.

Commenting on the transaction, Drew Sievers, mFoundry co-founder and chief executive officer stated, “FIS has been a great investment partner for the last several years, and the timing was right for us to combine forces to create the unparalleled industry leader in mobile delivery. This transaction enables us to capitalize on new market opportunities and bring top-tier mobile capabilities to our combined client bases.”

FIS anticipates paying approximately $120 million in cash to acquire the remaining 78 percent ownership interest in mFoundry. The transaction, subject to customary regulatory approvals and contractual closing conditions, is expected to close by the end of the first quarter.

About mFoundry
mFoundry is North America’s largest provider of mobile banking and mobile payments services. The leading software-as-a-service (SaaS), cloud-based mobile banking offering, mFoundry works with more than 850 banks and credit unions nationwide, including Bank of America, PNC Bank, Zions Bank and more than one-third of the top 50 financial institutions in the U.S. mFoundry is headquartered in Larkspur, California, with offices in downtown San Francisco. For more information, visit

About FIS FIS (NYSE: FIS) is the world’s largest global provider dedicated to banking and payments technologies. With a long history deeply rooted in the financial services sector, FIS serves more than 14,000 institutions in over 100 countries. Headquartered in Jacksonville, Fla., FIS employs more than 32,000 people worldwide and holds leadership positions in payment processing and banking solutions, providing software, services and outsourcing of the technology that drives financial institutions. First in financial technology, FIS tops the annual FinTech 100 list, is 425 on the Fortune 500 and is a member of Standard & Poor’s 500® Index. For more information about FIS, visit