Rebank: Fintech Analysis

Jannick Malling is the co-founder and Co-CEO of the investing platform Public.com. Public has raised more than $300M from investors including Accel, Greycroft, Lakestar, and Tiger Global, as well as celebrities like Will Smith, The Chainsmokers, JJ Watt and Maria Sharapova. In Public’s short life, Jannick and the company have experienced the COVID market crash, GameStop, the 2021-22 crypto meltdown and rapid interest rate hikes, all while building a community-led finance app for engaged retail investors. In this conversation, Jannick and I discuss building a community-led business, fans versus users, counterintuitive learnings about retail investor psychology, the trajectory of retail trading activity, running a company that ships product fast and more.

Christian Faes is the founder of Faes & Co, a lending business builder and F2 Finance, a US bridging lender writing loans since 2023. Prior to starting Faes & Co, Christian founded, ran and ultimately IPOed LendInvest, a UK mortgage lending fintech. Founded in 2008, LendInvest is an original fintech, having lent more than GBP 6 billion to individuals and property developers to date.  In this conversation, we dive pretty deep into the bridge loan a.k.a. short-term mortgage market, the role of technology in lending businesses, Christian’s goal of building a business in the US, the differences between the US, UK, Irish and Australian markets, all countries in which Christian has real estate lending experience, the economics of different types of fintech lenders and more.

Dan Kimerling is Founder and Managing Partner at Deciens, an early-stage fintech VC and investor in Chipper Cash, Treasury Prime and many others. Prior to starting Deciens, Dan co-founded Standard Treasury and served as its CEO until its acquisition by Silicon Valley Bank. Standard Treasury was one of the earliest players in what has evolved to become the Banking-as-a-Service space. The company was backed by YCombinator, Andreessen Horowitz, and Index Ventures. After the acquisition, Dan became responsible for API Banking, Open Platform, and Global Research at SVB. In this conversation, Dan and I discuss the strategy of concentrated bets, why he doesn’t want to see every deal, what’s next in startup funding, value accrual in AI and more.

Amias Gerety is a partner at QED with a specific focus on infrastructure, insurtech and payments. Prior to QED, Amias served as the President’s nominee and as Acting Assistant Secretary for Financial Institutions at the U.S. Department of the Treasury. In that role, he was the lead advisor to the Secretary on policies affecting financial institutions, fighting to restore order during the global financial crisis and impacting policy in the years that followed. Amias is a recipient of the Alexander Hamilton award, the Treasury’s highest honor. In this conversation, Amias and I discuss a few counterintuitive views on venture capital, thematic vs. opportunistic early stage investing, opportunities in payments and more. Thank you very much for joining us today. Please welcome, Amias Gerety.

Luca Prosperi is the co-founder and CEO of M^ZERO LABS_, a team building a new backend for the banking system. Luca is a deep thinking analyst, economist and builder, with a background in institutional finance, alternative and credit investments and more recently DeFi lending and governance. Luca publishes analysis on Dirt Roads, a must read for anyone thinking about the construct and evolution of money and associated topics. M^ZERO sprang into life recently with the announcement of a $22.5m seed round from investors including Pantera. AirTree, ParaFi, Mouro and Earlybird. The team is building decentralized infrastructure with the vision of ultimately replacing the commercial banking backend, starting with a better stablecoin. In this conversation, Luca and I discuss the inspiration and vision for M^ZERO, Luca’s learnings from his time at MakerDAO, governance considerations for decentralized institutional infrastructure, the shortcomings of existing stablecoins and his team’s proposed approach, M^ZERO with respect to the current banking industry turmoil and more. Thank you very much for joining us today. Please welcome, Luca Prosperi.

Sheel Mohnot is Co-Founder and General Partner at Better Tomorrow Ventures, an early-stage fintech VC currently investing out of its $225m second fund.   Sheel is a former founder, having built a tech-first card processor way back in 2010 which was quickly acquired by Groupon.   Since 2014, Sheel has been angel investing and, as of 2016, investing full-time.   Sheel is an incredible Twitter follow and constant source of information, insight and entertainment.   In this conversation, we discuss how fintech VC has changed over the last few years, the state of the early-stage market today, what separates elite seed funds from others, building social capital as an investor, the investment areas Sheel is currently focused on and more.   Thank you very much for joining us today. Please welcome, Sheel Mohnot.

Matt Harris is an entrepreneur and investor and the founder of Bloom Credit, an API platform for credit data access and analysis. Currently, Matt is focused on investing and advising, working with VC-backed founders and advising companies in the credit space.   Among other things, Matt is an advisor to Commerce Ventures, writing scout checks and helping the fund make fintech investments.   Matt is also an active angel, having invested in 10+ fintech companies including TrueAccord, Karat and HM Bradley and a number of others.   In this conversation, we discuss the level of understanding among VCs and founders of the credit business, the inputs to effective underwriting, how to build a great credit business, emerging opportunities like embedded credit and more.   Thank you very much for joining us today. Please welcome, Matt Harris.

Stephane Lintner is Co-Founder & CEO of Jiko, a new take on the money storage and transaction layer in banking, a.k.a. checking accounts and cash management.   Jiko was founded in 2016 with the mission of providing consumers and businesses with direct access to spendable T-Bills, combining all the benefits of checking accounts with the safety and, depending on the economic cycle, yield of treasuries.   Jiko has raised $89m according to Crunchbase, including $40m in October. Jiko offers accounts directly to consumers via an app and to corporates and platforms via API. Jiko owns and operates an OCC-chartered national bank, which it acquired in 2020, and a registered broker-dealer.   In this conversation, Stephane and I discuss Jiko’s concept and ultimate vision, the implications for the existing banking model, Jiko’s successful bank acquisition, the relationship with adjacencies like stablecoins and CBDCs, and more.   Thank you very much for joining us today. Please welcome, Stephane Lintner

Matt Brown is a venture capitalist and Partner at Matrix Partners.   Matt is a founder and operator turned investor, having started two software companies, both backed by Matrix, and then led product for AfterPay in the US in the lead-up to its acquisition by Square, now Block.   Matt’s second company, Bonsai, is a vertical SaaS company for micro businesses which evolved from a pure software company into a fintech through the incorporation of financial products, before embedded finance was a household term.   Matt is strategic and thoughtful, writing regularly on fintech market dynamics, with a specific focus on payments, credit and vertical SaaS.   In this conversation, we discuss Matt’s approach to seed and A-stage investing, BNPL and the implications for digital commerce more broadly, Matt's analysis of payments market dynamics, opportunities for early-stage fintechs in an increasingly saturated market and more.   Thank you very much for joining us today. Please welcome, Matt Brown.

Chris Dean is the co-founder & CEO of Treasury Prime, a leading US banking-as-a-service platform fresh off a $40m Series C raise.   Treasury Prime is a software company that connects sponsor banks to customer facing fintechs and by doing so powers bank accounts, cards and money movement. Unlike others in the banking-as-a-service space, Treasury Prime describes itself as building a network of interoperable sponsor banks and customer-facing fintechs in a ground-up approach to Open Banking in the US.    In this conversation, Chris and Will Beeson discuss the state of the banking-as-a-service industry, Treasury Prime’s approach compared to other software-based BaaS companies and tech-enabled sponsor banks themselves, the economics of banking-as-a-service, the evolving regulatory environment and more.    Thank you very much for joining us today. Please welcome, Chris Dean.

Jared Franklin is an investor at Costanoa Ventures.   Costanoa is a seed-stage VC focused on fintech, data and developer infrastructure, applied AI and security, specifically B2B.   The firm has $1.5b under management across seed and growth funds, including its $225m fourth seed fund.   Prior to joining Costanoa, Jared worked in product across fintech and crypto for BillMeLater, PayPal and BlockFi.   In this conversation, Jared and I discuss his experience transitioning from operating to investing, the learning curve as a new investor, Costanoa’s approach to identifying and supporting companies at the seed stage, and 7 investment themes Jared is focused on in 2023.

I’m joined by fintech and web3 luminary Lex Sokolin, Head Economist at ConsenSys and author of the Fintech Blueprint, for a discussion about the embedded finance value chain.   As listeners know, this is a topic of great interested to me, and I was happy to have the opportunity to dig into it with Lex in a conversation that we’re releasing through both of our platforms.   In this conversation, Lex and I take stock of the BaaS and embedded finance space in a moment of market dislocation to see what it reveals about what works, what doesn’t and where the next opportunities are.   If you don’t already subscribe to the Fintech Blueprint, I’d highly encourage you to do so for the best analysis in the industry. For an example of their content, check out the post for this episode on rebank.cc.   Thank you very much for joining us today. Please welcome, Lex Sokolin.

Banking-as-a-Service (BaaS) has been the subject of much excitement in fintech over the past few years, together with the related but more general concept of embedded finance.  It powers companies like Chime, Robinhood and Coinbase and can include products like checking, savings, debit cards, credit cards, lending and more. In this episode, we read an essay analyzing the BaaS value chain, which we argue is not currently in equilibrium and predict will evolve. Read the article here: https://rebank.cc/the-baas-value-chain-is-broken/   

Rex Salisbury is the Founder of Cambrian and GP of Cambrian Ventures. Rex is a key figure in the Fintech ecosystem, having started Cambrian as a product meetup in 2015 and ultimately growing it into a community of 15,000 newsletter subscribers, 5,000 meetup members, 1,300 founders and now an early-stage venture fund. Along the way, Rex spent two years at a16z as a partner on the Fintech team, backing companies including Deel and Tally, according to TechCrunch.   Though only having just closed the fund, Rex has already made five investments, including in Keep Financial, a bonus management platform started by Kabbage founders Rob Frohwein and Kathryn Petralia.   In this conversation, we discuss Rex’s approach to fundraising as a solo GP and factors that contributed to his success, raising and deploying a fund in the current market environment, Cambrian’s investment and value creation strategy and much more.   Thank you very much for joining us today. Please welcome, Rex Salisbury.

Marieke Flament is CEO of the NEAR Foundation. NEAR is an emerging layer 1 blockchain specifically optimized for usability, along with speed and security. NEAR was founded in 2018 to improve on aspects of layer 1s then in existence. In its short history, NEAR has built an extremely strong institutional backing and vibrant developer community.   NEAR has raised an impressive $530m+, according to Crunchbase, from an incredible list of investors including Tiger Global, FTX Ventures, Jump, Alameda, a16z and many more   As CEO of the NEAR Foundation, Marieke is responsible for ecosystem development across developers, entrepreneurs, investors and users.   In this conversation, Marieke and I discuss competition among L1s, NEARs efforts to establish a foothold as a newer protocol, developer and investor motivations in selecting blockchain infrastructure, opportunities and potential risks deriving from NEAR’s institutional investor base, prevailing web3 developer and entrepreneur sentiment given current market conditions, balancing growth and community stewardship as an emerging L1 and much more.   If you’re interested in this space and want to go deeper, we recently published a deep dive analysis of NEAR, available to Premium Rebank subscribers at rebank.cc.   Thank you very much for joining us today. Please welcome, Marieke Flament.

Giuseppe Stuto is Managing Partner of 186 Ventures, a $37m seed fund launched in late-2021. 186 has made 10 investments since inception, following on from over two dozen angel investments Giuseppe and his partner Julian made over the past few years. Across angel and seed investments, Giuseppe and 186 have invested in UiPath, Chainalysis, Ponto and dozens more.   Prior to starting 186 Ventures, Giuseppe founded Fam, a group video app that was acquired by DraftKings.   In this conversation, Giuseppe and I discuss seed investing in a bear market, differentiating as a seed investor in a competitive space and themes 186 is currently focused on.

It’s great to be back after taking nearly a year off from regular content to build and launch BELLA.   The break wasn’t really planned, but between launching the business, having a son and moving to LA all while dodging COVID, it was unavoidable.   But just because we weren't publishing, doesn’t mean we weren’t going deep on fintech.    The team and I built and launched BELLA in less than twelve months, and we’re aggressively scaling it now.    In the background, I've continued to trade views and break down strategy with the world’s leading founders and investors.    Over the next few weeks, we’ll share some of the most topical discussions we’ve had over the past year, and we’re also working on new content that you’ll start to hear and see.   Right now, we’re especially interested in embedded finance, DeFi, M&A, new takes on traditional consumer finance products, payments, e-commerce, digital investments and, as always, digital banking. We’re always looking to talk to great people in those areas, so please shoot recommendations our way.   We’re still figuring out the podcast schedule, which we expect to be less frequent than weekly. We’ll be increasing focus on our newsletter, especially our premium content. Sign up at bankingthefuture.com/subscribe.   In today’s episode, we’re joined by Tilman Ehrbeck, Managing Partner at Flourish Ventures, a venture firm focused on improving the financial health and prosperity of people around the world. Flourish invests in segments including Challenger Banks, consumer and SME lending, personal finance, data analytics, insurance and financial infrastructure in countries in the Americas, Africa and Asia.   Flourish has invested in companies including Chime, Aspiration, Tandem, Grab Finance and more.    I find Tilman to be extremely thoughtful and a great communicator, and he’s doing hugely important work. This conversation helped me better understand how impact-oriented VCs like Flourish balance purpose with financial returns in the highly competitive venture space.    Thank you very much for joining us today. Please welcome, Tilman Ehrbeck.

Today, we’re joined by Shamir Karkal, co-founder of Simple, the first digital bank in the US, and now co-founder of Sila. Founded in 2009, Simple was the original digital bank, conceived and built to give people more control over their money. After a few successful years, Simple was acquired by BBVA for $117m, under whose ownership it operated until early-2021, when it was shut down. Simple was loved by its users and mourned following it’s closing, in what was a sad moment for fintech. Today’s breed of digital banks, including Chime, Varo, Current and others, inherited a lot from Simple, who pioneered the space. However, few of Simple’s most popular features have been replicated by other players. In recent years, we’ve seen huge user growth achieved by fintechs offering banking to previously underserved customers, especially those living paycheck to paycheck. Nonetheless, Simple leaves a powerful legacy, and many lessons learned, for the entire fintech industry. In this conversation, we go deep on what worked and what didn’t for Simple, why it never hit escape velocity, why its users loved it so much and how Shamir and his co-founder Josh engineered life changing payouts for their employees through the BBVA acquisition. We also discuss Shamir’s current company, Sila, which is building programmable money for the next generation of fintech companies. For all of our past episodes, and to sign up for our newsletter, please visit www.bankingthefuture.com. Thank you very much for joining us today. Please welcome, Shamir Karkal.

Today, we’re joined by Viktor Nebehaj, Co-Founder of Freetrade, a free stock trading platform in the UK. Founded in 2016 and launched to the public in 2018, Freetrade has grown to over 500,000 users in just over two years in the UK alone. For the full backstory, check out our episode with Founder Adam Dodds from February 2019, available at bankingthefuture.com. In this conversation, Viktor takes us behind the scenes at Freetrade over the past few weeks, during the Reddit-fueled runups in Gamestop, AMC and others, as the company struggled with partner-imposed trading halts and FX throttles. We also discuss payment for order flow, margin lending, rapid user growth and Viktor’s views on the good, bad and ugly of free stock trading. If it seems like I care deeply about this subject, it’s because I do. Investing is one of the most important things people can do to support their long-term financial well-being, but the industry is characterized by unnecessary complexity, conflicts of interest and information asymmetry that can make it hard for people to get the best outcomes. Companies like Freetrade, Robinhood and others have a tremendous opportunity to break up entrenched industry dynamics and bring access, education and tools to the masses now that they're mainstream in their respective home countries.

Welcome to our much anticipated first episode of 2021, and what a start to the year it has been.    Last week was a trainwreck as Gamestop, which was initially bid up by Redditers in an attempt to punish Wall Street, crashed back to earth when the very free brokerage platforms that purport to democratize investing for the 99% shut off trading in the most active stocks, benefitting hedge funds at the expense of retail investors.   As wild as the events of the week were, they are merely a symptom of something much deeper: latent hatred for Wall Street and  the traditional financial system that repeatedly and seemly unfairly rewards a small number of people at the top.   Precisely because of this feeling that the system is broken and doesn’t serve the people, fintech is flying. Robinhood, Chime, Cash App, Coinbase, Affirm and Klarna have built insane user bases, because they are catering to huge swaths of Americans left behind by the incumbent industry.    These companies are the future of retail finance in America for sure. What will their impact be?   I’m joined by Lex Sokolin to discuss these topics. Check out all of Lex’s work at fintechblueprint.com   For all of our past episodes, and to sign up for our newsletter, please visit www.bankingthefuture.com.   Thank you very much for joining us today. Please welcome, Lex Sokolin.