Podcasts

F-Prime Capital’s Ben Malka: ‘There’s lots left to do in insurtech’

  • Ben Malka has been investing in fintech since the late nineties.
  • The F-Prime partner joins us to describe his journey and where he's looking to invest now.
close

Email a Friend

F-Prime Capital’s Ben Malka: ‘There’s lots left to do in insurtech’

Ben Malka is a partner at venture firm, F-Prime Capital. Beginning at Capital One Partners and continuing through F-Prime, Ben’s been investing in financial technology in capital markets, banking, insurance, and payments. Our discussion takes us through how fintech has evolved during Ben’s career and where he’s looking for opportunities now.

We talk about Plaid’s massive investment round and the role data aggregation plays in the entire industry. Lastly, we travel through Ben’s and F-Prime’s fintech investment portfolio which includes Snapsheet, Flywire, and Toast.

SubscribeiTunes I SoundCloud I Spotify
The following excerpts were edited for clarity.

Ben’s personal journey

I worked for Boston Consulting Group in Chicago helping financial services companies on key strategic issues. During the late nineties, I was fortunate to work with companies like Ameritrade, which built the first generation of online financial products. I had a front row seat to how the world would change when you take away the face to face interface between customers and their financial institutions. That gave me a great platform to witness this evolution and eventually, start investing in the thesis of the changing front door to a financial institution.

Somewhere along the way, I met Capital One, which was interested in launching a venture fund focused on investing in the financial services sector. It was a natural fit. I moved from BCG in Chicago to Capital One’s office in Boston.

The changing fintech investment thesis

When I first started investing in the sector, it was counterintuitive to most people. The prevailing thought for venture capital investors was to stay away from regulated and complicated industries. The financial technology sector moved along more slowly and didn’t really become a popular investment sector until 2010 or 2011.

It was a relatively unknown sector that we found to be a productive place to make investments. We looked at the numbers and calculated that financial technology received only 2 percent of all invested capital between 2000 and 2010.

Around 2010, there were several success stories, like GreenDot and Netspend, that got people’s attention. People started thinking that this was a sector that they hadn’t paid attention to, but you could do things that were good for consumers and build profitable business models. Lending Club and Prosper got people’s attention, too. Credit Karma is the most recent member of that batch that changed people’s minds about the sector.

F-Prime’s fintech investment model

F-Prime typically invests early, after product-market fit has been established. We are willing to work with teams to build themselves out and develop their products over time. But we’re looking for some market acknowledgement that customers like what a company is doing. What that translates into is typically an A or B round. Occasionally, we’ll participate in a C round.

We invest between four and seven million dollars on an entry. The intent is to get deeply involved in a company and be active investors.

F-Prime’s fintech portfolio

We’ve invested in a number of companies that are core to our thesis, leveraging key secular shifts in the economy. These companies include Flywire, Toast, Snapsheet, Vestwell, Quovo and Recurly.

Flywire helps students attending universities abroad to pay their tuition more efficiently with a better customer experience. It’s sponsored by the educational institution, so it doesn’t feel like it’s foreign. Oftentimes, it replaces a very confusing and expensive money transfer process.

Toast does payments processing and point of sale for restaurants, reinventing how the point of sale looks on the ground.

Snapsheet is a company I’m very involved with and very excited about. It helps insurance carriers settle auto claims after an accident, using pictures and not a visit to an adjuster or body shop. They do that in an app, so the pictures can be authenticated. The company has grown dramatically and it’s processing a substantial number of claims for insurance carriers. We think it’s more efficient for claims-processing in workflow and accuracy.

 

0 comments on “F-Prime Capital’s Ben Malka: ‘There’s lots left to do in insurtech’”

Member Exclusive, Podcasts

Inside Cross River’s ecosystem of some of the best fintech brands

  • Cross River combines tech and banking to power brands like Affirm, Coinbase, Upstart, Upgrade, and Stripe.
  • Chief strategy officer Karan Mehta joined us at The Big Bank Theory Conference to discuss how Cross River’s technology enables the delivery of innovative financial solutions to millions of consumers and businesses.
Zachary Miller | December 03, 2021
Member Exclusive, Podcasts

‘Don’t let any legacy tie you down’: How Piermont Bank blends humans and technology to service midmarket SMBs

  • Piermont Bank serves mid market SMBs with a hybrid blend of digital and human bankers.
  • CEO Wendy Cai-Lee joins us on the podcast to talk about building a bank that addresses SMB pain points.
Zachary Miller | December 01, 2021
Member Exclusive, Podcasts

‘We see more and more nonprofits adopt the fintech model’: Prudential Financial’s Sarah Keh

  • Large financial organizations are increasing their work in their communities and with inclusivity.
  • Prudential's Sarah Keh joins us on the podcast to talk about her work with nonprofits and the city of Newark, New Jersey.
Zachary Miller | October 14, 2021
Member Exclusive, Podcasts

Embedding communications into financial services with Twilio’s Bijon Mehta

  • Twilio's embedded communications tools work behind the scenes in many of today's top fintechs and FIs.
  • Bijon Mehta, who leads the firm's work in financial services, joins us on the podcast to shed some light on where the firm grows from here.
Zachary Miller | September 21, 2021
Data, Member Exclusive, Podcasts

‘Data aggregation is used today in ways we wouldn’t have thought about five years ago’: Fiserv’s Kevin Hughes

  • Fiserv enables banks, credit unions, and fintechs to aggregate data seamlessly and securely.
  • Kevin Hughes, who manages the AllData products, talks to Tearsheet about changes in the aggregation field and where it's heading.
Fiserv | September 09, 2021
More Articles