Step, a mobile banking service for teens, has raised $50 million in Series B funding after reaching over 500,000 users just two months post-launch. The funding round was led by Coatue, with participation from existing investors including Stripe, Crosslink Capital, Collaborative Fund, and Will Smith's Dreamers VC. TikTok star Charli D'Amelio has also joined the list of investors.

Lorikeet, an AI customer experience company, has secured an additional AUD 9 million in funding from Blackbird and existing investors, following a USD 5 million seed round last year. The funds will enhance Lorikeet's platform and expand its market presence in industries like healthcare and finance. Lorikeet's intelligent graph technology enables AI agents to handle complex support queries, improving customer satisfaction and support efficiency for clients like Eucalyptus and Magic Eden.

A chain is only as strong as its weakest link, as the saying goes. And as the fallout from Synapse’s chaotic bankruptcy continues, containing the impact of its collapse across the financial services and FinTech supply chain ecosystem is top of mind for both the over 100 affected firms and industry observers alike.That’s because the implosion of Synapse, a middleware firm whose services allowed other businesses to embed banking services into their own offerings, has rattled the prospects of many other startups, while at the same time underscoring just how interdependent the FinTech world is — and how vulnerable it can be to a single point of failure.Fundamentally, the Synapse story is a B2B story, one with commercial relationships at its center.Synapse’s troubles potentially began — or were brought to light — when Synapse’s largest client, Mercury, decided to work directly with Evolve, Synapse’s core banking partner, cutting out the need for Synapse as an intermediary.That set off a chain of events, few of them good, for Synapse’s other clients who relied on the FinTech provider as their connective tissue.And it highlighted the fact that effective management of third-party risks, as well as the mitigation of single points of failure, is perennially essential for B2B success — no matter the industry a business is operating within.Read more: Five Things to Watch as Synapse Bankruptcy Impact Shakes Up FinTechsSynapse Customers Struggle to Navigate Fallout From CollapseMany FinTechs relied on Synapse as a foundational partner to jumpstart their own growth, and Synapse’s collapse has underscored the cascading effects of what can happen when a core partner of a business’s own core partner moves their business elsewhere.Along with Mercury, FinTech companies Relay, Cleo, Dave, Yotta and Stilt are all among Synapse clients that have since moved on to other Banking-as-a-Service (BaaS) providers or decided to shift their own product offerings.Neobank Juno Finance, which provides on-ramp services to the cryptocurrency ecosystem, has been unable to find a new partner post-Synapse’s collapse because its relationship with the crypto sector has kept other banks at bay, per a company blog post.“This has been incredibly difficult and frustrating for us as well and the entire team who has been caught in the crosshair … between Synapse and Evolve Bank & Trust,” said Juno in the same statement, noting that the company has been provided with “very limited visibility and information.”Teen-focused banking app Copper, for example, has decided not to find another provider and is instead pivoting to sell its platform as a solution to other banks, while crowd-funding investment marketplace Mainvest is shutting down its business entirely by June 14 due to Synapse’s bankruptcy.“External factors have led us to the difficult decision to cease Mainvest’s operations and dissolve the company,” the company wrote.And as many as 100 other companies have found themselves struggling to navigate Synapse’s bankruptcy and collapsed relationship with Evolve. Because Synapse’s architecture was unregulated, it is unlikely that federal officials will step in to help as they did when Silicon Valley Bank (SVB) collapsed last year, leaving any resolution up to a potential settlement or court order, neither of which have happened yet.Still, it’s not all bad news. After moving on from Synapse, business banking platform Relay announced Wednesday (May 29) it had raised $32.2 million Series B round.PYMNTS has reached out to both Synapse and Evolve for further comment.Read more: Managing Third-Party Risks Emerges as Key B2B IssueWhen the Middle Falls out of MiddlewarePYMNTS Intelligence found this past summer that 65% of banks and credit unions have entered into at least one FinTech partnership in the past three years, with 76% of banks viewing FinTech partnerships as necessary to meeting customer expectations. And a full 95% of banks are focused on using partnerships to enhance their own digital product offerings.“With complex ecosystems, you have a higher number of partners than you may have historically had” in the past, Larson McNeil, co-head of marketplaces and digital ecosystems at J.P. Morgan Payments, told PYMNTS