Are banks facing a generational shift?
Banks are gradually morphing into backbones of fintech innovation, blending their compliance expertise with technology. They could end up reaping the benefits of hindsight in their efforts to support newer fintech solutions.
Is profitable scaling the new frontier?
Startups are shifting from "growth at all costs" to sustainable, profitable scaling. With tighter funding, high CAC, and pressures on LTV, fintechs are diversifying, optimizing unit economics, and focusing on efficiency. Success hinges on building scalable platforms and partnering with investors for sustainable growth.
Is SaaS Becoming “Service as a Software”?
SaaS is shifting from product-focused to outcome-driven models, powered by AI "copilots" that allow businesses to focus on quality services. This evolution enables outcome-based pricing, tying costs to measurable customer success. SaaS growth now demands adaptable strategies and investor support for scalable value delivery.
Is sharing financial data caring?
Rule 1033 empowers consumers with data control, promoting competition and financial inclusion by enabling permissioned data sharing, helping underserved consumers access valuable services. Some provisions like annual reauthorizations may slow adoption of beneficial services like credit score improvement. A flexible, transparent approach from all players could make data-sharing truly consumer-focused.
Go funded or fundless?
The McGuireWood Independent Sponsor Conference highlighted a growing shift in lower middle market private equity toward fundless, deal-by-deal investment models, offering more flexibility and alignment with stakeholders. Increasingly, firms led by operators are focusing on specialization, value creation, and equity upside, with trust and deep industry expertise becoming crucial for success.
Does strategic money win better?
Financial technology (Fintech) startup executives and their boards should consider engaging corporate investors as an alternative way to leapfrog competition. The right CVC can provide tangible strategic augmentation through early commercial endorsement and referenceability, while creating implicit downside protection.
Can AI agents outsmart SaaS?
The traditional SaaS model is being challenged by AI and smart agents. Companies need to reimagine their product and operations around data, efficiency, and find the right capital solutions to sustain growth.
If they come, will they stay?
Retention-first companies are built to last. The efficiency paradigm, paired with capital solutions that offer real operational expertise, is the new playbook for increasing company value.
Is Intelligent Augmentation The Next Big Thing In Financial Planning?
Financial planning is about to change. Intelligent augmentation isn’t just about improving accounting—it could fundamentally reshape how businesses manage their finances, creating opportunities for more strategic, real-time financial decision-making.
Don’t throw the baby out with the BaaS water
Recent challenges from a few middleware players have raised questions around BaaS (Banking as a Service). Yet, BaaS will continue to have a durable impact on enabling embedded finance. With their established risk and regulatory practices, banks may have a front-row seat.
Is WealthTech the future of advisory?
With the upcoming $68 trillion generational wealth transfer, WealthTech is making wealth management accessible to the masses, with digital solutions catalyzing more personalized adoption and engagement. Creating smart experiences for the net new users is where traditional advisors can add more value.
Is the first time the charm?
The sustained outperformance of emerging managers in both VC and PE highlights a compelling investment case for 2024. The drive to prove their thesis translates into more deliberate fund allocation, increasing the chances of outshining established funds and forging successful ventures.
Differentiated strategies (not crowded in terms of investment capacity), such as venture buyouts between VC and PE, can result in higher alpha with lower risk downside.
Are VC externalities creating new opportunities?
Most venture-backed businesses are hard to time, conceptually unproven or operationally frail from inception, and naturally end up failing. Very few emerge as market disruptors and winner-take-all outcomes. But what about the middle cohort? These businesses, with great founders, dedicated teams and product expertise can thrive with venture buyouts: a financial partnership and operator-led approach that offers founders a second shot at success.
Pack up or buckle up?
Venture capital model is well-suited for businesses with exponential growth patterns. For many startups, a steady 15-20% annual growth rate is a more realistic and sustainable goal. Founders can still realize strong economic success when partnered with the right investors. Venture buyouts offer a viable alternative, bridging the gap between traditional venture capital and private equity firms.
What’s left for founders when investors move on?
Drastic recaps can have a major impact on equity and future upside for Fintech founders. Venture buyouts help recognize and reward the true worth of their businesses, giving founders a renewed opportunity to realize value.
Are the lines blurring between VC and PE?
Buyouts are increasing as an exit option for VC-backed companies. From 2006-2011, they accounted for less than 10% of exits but rose to 20% by 2018. VC-backed buyouts grew 46% YoY in 2021.
Need to be “distressed” to consider alternative plans?
More startups can’t secure venture funding in the current market. Rather than “hoping for the best”, they should explore alternatives, such as buyout or M&A.
Do you need to “shrink to grow”?
After decades of hypergrowth, fintechs have entered a new era of value creation, where the focus is on sustainable, profitable growth according to McKinsey & Company’s "Fintechs: A New Paradigm of Growth” report
Are you ready to disrupt?
Fintech, AI and crypto are paving the ways to new businesses and monetization models. For founders and entrepreneurs, hustling, bootstrapping and focus on results prime. Ideas matter, but it’s all about execution.
Great People and Rigor
Great insights for founders from Jason Wenk in his fintech entrepreneur journey
1. Raise money from great people
2. Assemble a phenomenal team
3. Have operational rigor
4. Operate with some level paranoia and urgency
5. Control what you can control