In this weeks issue:
- Funnelling profitability
- Stealing business?!!!
- Big Tech's playbook?
- Aspergeddon?
- Credit for the unbanked (Red Cross edition)
- Experience has its advantages
- Privacy in the human zoo
- SEC update on Reg CF - time to scale?
- And remember to save this date: March 24 for some FFCON magic
Stories:
Funnelling profitability: In yet another example of the fast changing landscape of fintech and banking, PayPal stuffs it’s face with some Honey. The premium is massive meaning a nice payout for investors. This acquisition allows PayPal, like many of its tech brethren, to redefine the shopping funnel experience.
Stealing business?!!! Small business loans have been evolving from banking institutions to alternative lenders like tech companies. Banks are hampered by cost structure, legacy systems, regulation and culture. But another way of looking at it is that information asymmetry is no longer a competitive advantage in various areas of banking.
Big Tech's playbook?: Big tech has been competing overseas to develop new financial experiences for customers. Many of these customers have a tenuous experience with the financial sector. On the other hand, in North America Big Tech’s moves into the low end of the market look a lot like Clayton Christianson’s Innovators Dilemma.
Aspergeddon? Funding seems to be shifting a bit as one challenger bank finds itself experiencing some, uh, challenges closing funding. This is a competitive field with lots of talent gobbling up all the customers they can acquire. There’s lots of reasons why funding doesn't go well, but the lesson here is that confidence is everything.
Credit for the unbanked: This is your must read of the day. The Red Cross is trying to help the unbanked in Kenya with the paradox of no cash and credit. They’re using an interesting approach involving the blockchain, coin and credit creation. While Libra’s getting all the headlines, this is an interesting solution that could actually work.
Experience has its advantages: In what often comes as a surprise to some, entrepreneurs can come from any age group. In fact, the average is often in the 40’s. Jim Simons, arguably the most successful hedge fund manager in history, started his fund in his 40’s after a successful career in math. Debunking myths and surprise findings.
Regulation:
Privacy in the human zoo: One of the challenges in a smart city is privacy, or lack thereof. Various companies are attempting to address the problem. The question is, how many people want to live in a city designed like a human zoo?
Reg CF: The SEC is acknowledging the viability and success of crowdfunding as a financing option. They have come up with a framework to regulate it. With 50 approved fund portals approved, hopefully regulation will enhance, not choke off this valuable financial innovation.
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Featured Industry Partner of the Week:
Congrats on raising $160M+