New banks, Podcasts

The Challengers 12: Visa buys Plaid, Starling shoots for breakeven, Monzo co-founder quits to join alpaca farm

  • On this episode of The Challengers, Zack and Josh discuss the impact of Visa's acquisition of Plaid.
  • Also, Starling wants to reach breakeven in 2021. And alpaca farms.
The Challengers 12: Visa buys Plaid, Starling shoots for breakeven, Monzo co-founder quits to join alpaca farm

In this episode of The Challengers, Josh Liggett and Zack Miller discuss Visa’s $5.3 billion acquisition of Plaid. Admittedly, data aggregation isn’t that sexy but Zack thinks it is the underpinning of modern financial technology. Data agg enables customer financial data to move securely between financial institutions and fintech apps.

Zack thinks Visa is interested in leveraging Plaid’s inroads into some of the top fintech firms (Robinhood, Venmo, Square) as the payments firm continues to build out its own ecosystem. Josh says that people don’t really understand what Plaid does, and yet Plaid — and solutions like it — are vital to the growth of the digital finance industry.

Next up, Zack cites Tearsheet research that asked financial professionals what they thought of challenger banks. The short of it is that they see top firms like Revolut and Monzo as competitive to consumer banks over the long run. But when it comes to business banking, not a single challenger was deemed even slightly competitive to incumbent commercial banks. Josh doesn’t believe we’ve seen “the one” that’s really going to win at business banking.

Josh was skeptical of Starling’s claims that it will hit breakeven by the end of 2021 in anticipation of a 2022 IPO. Challengers continue to bleed money, so it’s interesting to see a single name in the space emphasizing the move to profitability. This dovetails with Josh’s discussion on unit economics in the last episode of The Challengers.

Just for discussion, Starling’s major competitors in the UK, Monzo and Revolut, reported a pretax loss of £33.1 million ($42.2 million) and a post-tax loss of £32.8 million ($41.8 million) in 2018, respectively. Starling did only somewhat ‘better’, with a pretax loss of £26.8 million ($34.1 million) in the year to November 30, 2018.

Lastly, Zack and Josh talk a little about the work-life balance that’s so elusive in working in early stage fintech. Monzo co-founder, Paul Rippon, resigned this week and said he would join his wife working on an alpaca farm. Finding balance is tough, especially in this competitive space. Good for people who can build stuff, work hard, and then move on.

Banking as a service, Podcasts

On Open Platform, BBVA’s banking as a service offering, with Susan French

  • BBVA's Open Platform is a competitive banking as a service offering in the U.S.
  • Head of product Susan French joins us to discuss what products and services the platform powers.
Zack Miller | February 27, 2020
Payments, Podcasts

Splitit’s Brad Paterson: ‘The state of the industry reminds me of the early days of PayPal’

  • Splitit enables consumers to make installment payments on their purchases.
  • New CEO Brad Paterson joins us to discuss his company's growth strategy.
Zack Miller | February 20, 2020
Podcasts

Even Financial’s Phill Rosen: ‘CAC is going up as the space becomes more competitive’

  • Customer acquisition continues to get harder and more expensive for financial services.
  • Phill Rosen's Even Financial matches consumers with financial products.
Michael Deleon | February 13, 2020
Podcasts

Deep Dive: How top fintech and banking apps improve engagement with consumers

  • Financial apps are constantly looking for ways to deepen their engagement with their users.
  • On today's Deep Dive, Tearsheet's Sara Toth Stub discusses how financial apps are becoming stickier.
Zachary Miller | February 04, 2020
Blockchain and Crypto, Podcasts

Gemini’s Jeanine Hightower-Sellitto on expanding institutional ownership of crypto

  • Gemini works with retail and institutional owners of crypto assets.
  • Managing director Jeanine Hightower-Sellitto was previously the COO at the ISE.
Zack Miller | January 27, 2020
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