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Embedded Finance monetization / commercial paytech venture capital

·Jan. 18, 2021

Explaining ~100x revenue multiples for Affirm, Checkout, Rapyd, and other fintech companies using systems theory

This week, we look at:

Over $1 billion in raises announced last week, and over $10 billion in Fintech company value creation: Checkout.com with $450 million at a $15 billion valuation, Affirm more than doubling after its IPO to $30 billion, lending enabler Blend raising $300 million, and payments enabler Rapyd raising $300 million.
A systems theory framework that explains the stocks and flows of goods and services, and what monetization strategies are available to fintechs
How transactional models are thriving and creating 50-100x revenue multiples

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big tech Crypto enterprise blockchain paytech stablecoins

·May. 6, 2019

Facebook and Bitfinex both want $1 Billion for Crypto Stablecoins

There is poetry in the symmetry of this situation. Bitfinex is looking to raise $1 billion in capital to support the most popular stablecoin Tether, which it controls. Facebook is reportedly looking to raise $1 billion in capital from First Data, Visa and Mastercard and other payments companies to shore up its own stablecoin asset. Poetry is where the similarities end, and all these devils are in the details.

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central bank / CBDC paytech stablecoins

·May. 1, 2020

Libra, Stablecoins, CBDCs and the Need for Digital Money

A digital world needs digital money, and a few influential players are actively working to build it. China's BSN initiative and Facebook's Libra embody the East's public sector led approach to building and owning the internet of value and the West's private sector led (and public sector challenged) attempt at cheaper commerce on the web. While the nature of the approaches may be different, the data and privacy considerations are eerily similar. For all of our past episodes and to sign up to our newsletter, please visit bankingthefuture.com. Thank you very much for joining us today. Please welcome Lex Sokolin.

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artificial intelligence big tech China civilization and politics paytech visual art

·Aug. 27, 2019

Fighting Chinese Artificial Intelligence with lasers and American Crypto with European Central Banks

How do the Americans and the Chinese have such different ethical takes on privacy, self-sovereignty, media, and the role of government? We can trace the root cause to the DNA of the macro-organism in which individuals reside, itself built over centuries and millenia from the collective scar tissue of local human experience. But there is more to observe. The technology now being deployed in each jurisdiction -- like social credit, surveillance artificial intelligence, monitored payment rails, and central bank cryptocurrency -- will drive a software architecture into the core of our societies that reflects the current moment. And it will be nearly impossible to change! This is why *how* we democratize access to financial services matters. We must be careful about the form, because we will be stuck with it like Americans are stuck with the core banking systems from the 1970s. But the worry is not inefficiency, it is programmed social strata.

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acquisition Embedded Finance Open Banking paytech

·Jan. 20, 2020

Is Plaid cheap at $5.3 billion for $500 billion Visa?

I dig deeply into the $5.3 billion acquisition of data aggregator Plaid by $500 billion payments network Visa. We examine why this deal is worth 25-50x revenue, while Yodlee's sale to Envestnet was priced much lower. We also look at how Plaid could be an existential threat to Visa, and why paying 1% of marketcap to protect 200 million accounts may be a good bet. Broader implications for product manufacturers across payments, investments, and banking also emerge -- the middle is getting carved out, and infrastructure providers like Visa or BlackRock are moving closer to the consumer.

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digital lending entrepreneurship neobank paytech

·Jun. 19, 2020

How to Build a $3.5B Profitable Digital Bank with Tinkoff

Oliver Hughes is the CEO of Tinkoff Group, one of the world’s most successful digital banking groups with over 10 million customers. This is one our most interesting conversation to date, full of fantastic operating advice.

Tinkoff is publicly listed with a $3.8 billion market capitalization, which brings clarity to its operating model in a time when many noteworthy consumer digital banks are pursuing customer acquisition at the expense of profitability.

Oliver has led Tinkoff through three financial crises, and brings experience and perspective to the current COVID crisis. This is a fascinating discussion about unit economics in digital banking and winning business models with a CEO with thirteen years of experience in this space.

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Crypto Investing IPO / SPAC paytech stablecoins venture capital

·Jul. 11, 2021

The fundamentals of Circle’s $4.5B SPAC, Robinhood’s IPO, and the $30B of fintech venture capital

Last quarter, fintech funding rose to $30 billion, the highest on record. $14 billion of SPAC capital is waiting to take these companies public. Robinhood and Circle are about to float on the public markets, via SPAC and IPO. In this analysis, we explore the fundamentals of both companies, as well as the unifying thesis that explains their growth.

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big tech digital lending Embedded Finance paytech

·Dec. 7, 2020

Who are the customers of Embedded Finance, and what do they reveal about Stripe, Affirm, DriveWealth, and Green Dot?

This week, we look at:

Embedded finance as a growing theme with the $10B Affirm IPO and Stripe's launch of Treasury
The customer types that each of these firms is attempting to convert into their product, and what this tells us about economic growth
A framework for understanding the emerging value chain of digital finance, and the role of platforms and marketplaces

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big tech China Investing IPO / SPAC paytech

·Sep. 21, 2020

Is Ant Financial the best Fintech in the world? Let’s analyze the IPO!

In this conversation, Max Friedrich of ARK Invest, Will and Lex break down Ant Group’s highly anticipated IPO.

Ant, a spinout from Alibaba and the parent of Alipay, one of China’s leading payments companies, filed papers to IPO in Shanghai and Hong Kong.

Max, Will and Lex dig into Ant’s business, from the origins to today, discuss growth opportunities and potential headwinds and explore the multi-faceted relationships between Ant and other big tech companies and national governments.

We cannot understate how impressive Ant Financial has become, connecting 700 million people and 80 million merchants in China, with payments, savings, wealth management and insurance products integrated in one package. The company also highlights the likely road for traditional banks — as underlying risk capital, without much technology or client management.

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digital transformation Embedded Finance mega banks Open Banking paytech

·Aug. 13, 2021

Treasury Prime CEO Chris Dean on Banking-as-a-service, embedded finance, and the evolution of FinTech API infrastructure

In this conversation, we chat with Chris Dean, who is the Founder & CEO at Treasury Prime. Previously, Chris was the CTO & VP of Engineering at Standard Treasury, which was acquired by Silicon Valley Bank for an undisclosed amount.

More specifically, we discuss all things banking-as-a-service, FinTech APIs, embedded finance, and the general evolution of the FinTech banking industry over the last decade.

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