So nice to see you! Let me welcome you to the #1st edition of Pocket Change - a fintech newsletter made by the Netguru team.
But first, do you love #hashtags? If you do, send a word to your friends about the newsletter and tweet #PocketChange. If you don't, don't tweet, but send a word anyway.
This is the 1st issue, so expect changes and upgrades in the future. And feel free to share your feedback.
This week, you can read about:
✅ How a French startup paved its way to the $79m funding and its own language;
✅ The one global trend that is leading to a new wave of digital challenger banks;
✅ What Uber’s push into fintech may mean for Monzo and others
✅ Two charts to prove whether PayPal is flying or dying
✅ Why Africa is hot and who’s on the top 10 list in the region
✅ How to sell to fintech companies (it works with any other industry as well!)
1. On the News
Fintech on a shopping spree, cash only. UK-based Jaja agreed to pay $671m in cash for the Bank of Ireland’s credit card unit. “Our vision is to enable a new generation of mobile-first credit card products with unrivalled functionality, service and security” - Neil Radley, CEO of Jaja Finance. More here.
BBVA is pushing for more innovation. The bank announced another accelerator program - BBVA Open Innovation Accelerator Program - aimed towards early stage and seed startups. Over a year ago I wrote about why this is a smart move, actually.
If there is one thing that the US may copy paste from EU, it is how to provide innovation-friendly legislation. The long-awaited fintech charter from the OCC (Office of the Comptroller of the Currency) turned out to be a market flop instead of game-changer. Even Google and PayPal walked away. See why the charter is not working.
Well, everybody already knows that Libra, the Facebook coin, is coming, with the launch expected in 2020. But have you read the whitepaper yet? “It can have massive implications on how people interact financially globally and on our privacy” - says @peterlih, Peter Grosskopf, CTO at Digital Asset Exchange of Börse Stuttgart. See the whitepaper.
In other news, Stuart Sopp, CEO at Current, claims that Facebook ripped off the logo for Calibra from his company.
2. Chart of the Issue - PayPal
Among the fintech crowd, PayPal looks like an old dog. Yet the company which was once treated only as a side dish to eBay is definitely capable of learning new tricks. See any signs of hiccups there?
3. Lessons Learned - the Fintech Case Study of the Issue
PayFit is a fintech startup from France that has evolved from a simple payroll service into an HR platform used by almost 3,000 companies across Europe. PayFit recently raised a new $79 million funding round and in 14 months PayFit grew from 60 to over 200 employees.
In a rare self-written case study, Florian Fournier, CPO and co-founder at PayFit, shared:
✅ Why they decided to create their own language in the first place?
✅ How the company tries to ensure alignment of the product vision within all teams?
✅ What helped them realise that things considered as priorities (eg. a mobile app) turned out to be secondary for customers?
✅ How the new role - at the intersection of Product Manager, Product Designer and Software Engineer - was created?
✅ Why the product was split into two and then quickly merged again
✅ Some metrics and reasoning behind PayFit’s expansion beyond the French market
✅ Why the company is moving from a top-down approach (priority developments defined by product managers) to a bottom-up approach.
Financial literacy is trending. And industry unicorns are rushing to expand their customer base with youths and kids.
Stripe leading a $22,5m round in Step, a startup that is developing mobile-based banking services for teenagers, with over 500,000 users on the waiting list.
Revolut about to launch an app for kids and youths this summer.
And there is a slew of startups focused on younger users - the likes of Greenlight, Hibbo, or Current.
Why does it make sense to focus on kids?
For one, to grow the brand as they grow.
“Schools don’t teach kids about money. We want to be their first bank accounts with spending cards, but we also want to teach financial literacy and responsibility.” - CJ MacDonald, the CEO and co-founder at Step, explained.
Angel Santodomingo - EVP and CFO at Banco Santander at the Q1 2019 earnings call
“If it’s not a bank, it's going to be a fintech. If it's not a fintech, it's going to be one of the big communications or media or social media companies. Competition is going to be here, and it is going to be intense (...). We welcome that. It makes us better.”