Before I get started, I wanted to mention that I struggled with the decision to post this, given the health and financial crises. I remain grounded and aware of how many people are out of work. I’m incredibly grateful for the position I’m in and feel for those less fortunate. I ultimately decided it’s worth posting because I believe something as simple as a blog post can help open doors for people in unexpected and unpredictable ways.
If you know me well then you know I can’t just update LinkedIn and call it a day. It’s only natural that I write, in long-form, a thorough explanation of how I got to this point. Maybe someone out there will take something useful away from this post that helps them navigate their career journey.
Here’s what this post will cover:
- My Career
- A bit on Fintech & the industry over the past 10 years
- Hot areas in Fintech
- Wise and why I’m so excited about joining
A Decade in Fintech
My last 10ish Years
My career began at Bill Me Later in 2007. BML was a pioneer in the online transactional credit space and was acquired by PayPal in 2009 (the offering is very much alive and well today– branded ‘PayPal Credit’). My time at BML and PayPal was extremely formative. I was exposed to an entirely new world. One that included product management, product development, marketing, e-commerce, and incredible people. BML bucked all of the startup stereotypes. It was a hell of a first job.
I left in 2011 to join Millennial Media. MM started around the time of the iPhone launch in 2007 and became the leading independent mobile advertising company, competing with heavyweights AdMob and Quattro/iAd. I left my comfortable job at PayPal because of exactly that– I was getting comfortable. I wanted to experience life in a different organization with different people. I saw hypergrowth up close and personal and met some fantastic people. I’m happy I decided to leave a comfortable place for a new experience. That’s always a little scary. I learned a lot about product development in a fast-paced environment and gained experience in a set of new disciplines that I wasn’t previously exposed to, like sales and account management.
With that being said, I learned that I really didn’t enjoy working on things that I couldn’t find relatable on a daily basis. Although ad networks are interesting, complex, and vital to digital ecosystems, I wasn’t passionate enough to want to spend much more time in the space.
I went back to PayPal two years later. Although I technically worked there before, the environment was completely different than the one I left a few years before. I got to own a distributed product development team and be a part of a huge international project including hundreds of people, 3 countries, and tight deadlines. As tough and frustrating the environment was, I’m thankful for the experience and was proud of what we accomplished. If you’ve read my blog or follow me on Twitter, you know how often I preach about the value of gaining experience inside both large and small orgs.
Two years later came Blispay– a seed-stage, pre-product startup with a dream team. Joining was a no-brainer due to the low perceived risk. My framework:
- Career Risk
- Market Risk
- Technical Risk
- Execution/Operational Risk
We were a B2B2C company focused on helping omnichannel SMBs grow by offering their consumers a credit product that was essentially a mix between a BNPL offering & an everyday cashback card. We instantly decisioned consumers, instantly issued, and gave 6 months of no payments, no interest on purchases of $199+, and 2% cash back on all purchases. If you’re scratching your head then just take this away: we were a point of sale lending startup. We used to say that Blispay was for your laptop and your lattes as a consumer. We helped businesses sell more without charging them anything. It was an amazing experience that I’ll cherish forever, despite the exit coming earlier and falling shorter than we hoped for.
Startups are hard. And lending startups are really, really hard.
Alliance Data Systems acquired us after four years. The ending of the Blispay years and being acquired was challenging to process. I wrote a bit about it in this 2019 reflection post, and later in a post titled, Finding your mojo post Acqui-hire. It was apparent relatively early that many of my colleagues and I wouldn’t be spending the rest of our careers at ADS. It’s not exactly a company any of us would have proactively applied to for various reasons. With that said, it allowed me to exercise some professional muscles that I hadn’t needed to use while at Blispay, and my team was tasked with building something vital to their future. We delivered on that, and I’m proud to leave knowing the impact our work could end up having on the company. COVID is a headwind to their business, and our work will directly enable them to better compete in an increasingly digital world.
So I’m moving on after a year and a half at ADS and a lot of reflection (made evident that by the fact that I also wrote What eBay, Napster, and Banks have in common after I wrote those 2 other posts I just mentioned).
Enough about me for a bit. Let’s talk about financial technology [crowd goes wild]!
Fintech’s last 10ish Years
None of these existed prior to 2009 🤯:
Stripe, Square, Shop Pay, Venmo, Zelle, TransferWise, Remitly, Branch, Brex, Robinhood, Simple, Chime, Current, Varo, BlueVine, Apple Card, Marcus, Very Good Security, True Accord, Afterpay, Affirm, Carta, Coinbase, Gemini, Bitcoin, Ethereum, Fundrise, Personal Capital, Wealthfront, Betterment, SoFi, Plaid, Opendoor, Figure, Nova Credit, [Jared… take a deep breath…ok … keep going], Privacy.com, Rally Rd., GumRoad, Upstart, LendUp, Alloy, SentiLink, Marqeta, Finix, Dwil, nCino, Mambu, SynapseFI, Mercury, Unit, Modern Treasury, Lendflow, Root Insurance, Bond, Azlo, BankMobile, Joust Bank, Airwallex, Novo, Mantl… the list goes on.
There are huge problems to be solved that many outside our space could never even fathom. There’s been tremendous progress but there’s still tremendous opportunity. I learn about a new one every day. For example, my friend Ritchie just told me about Mantl, a fellow Techstars co. They helped solve a problem for Radius Bank and now they’re killing it. One of the coolest things about fintech is that while many of us could compete in ways, we can also learn a lot from each other and find ways to work together. The problem space is massive.
The complexity of the payments ecosystem makes for endless opportunities.
Even these didn’t exist: ZenBusiness, BigCommerce, WooCommerce, Fiverr, Handy, Toptal, Boatsetter, Toast, Slice, DoorDash, VitusVet, Funnel, the Durbin amendment, COVID-19…
Consumers are benefitting, businesses are benefitting, and it’s still early innings (I hate baseball, but, whatever).
Fintech Today, and in the Future
Fintech isn’t new.
But Fintech’s having a moment.
It’s nearly memeable!
Just today I learned that BaaSGoat is a thing, because, why not 🤷♀️
The sheer amount of announcements and fresh news outlets is a direct reflection of the rapid pace of development in the space. And it’s not slowing down. Here are some headlines from just the past couple of days:
- Google signs up six more partners for its digital banking platform coming to Google Pay
- Jobber partners with Stripe to activate financing and instant payouts for home service businesses
- Intuit launches QuickBooks Cash accounts for small biz
- ZenBusiness buys Joust
- BankMobile Technologies, a Subsidiary of Customers Bank, and Megalith Financial Acquisition Corp. Agree to Combine to Bring a Digital Banking Platform to the Public Market under the New Name BM Technologies
- Global Payments Joins Forces with AWS to Deliver the Future of Payments
- Mobile bank Current launches a points rewards program for debit card users
And here are just a few of the recent opinion articles, reports, and interviews:
- Fintech Scales Vertical SaaS
- Banking as a Service: reimagining financial services with modular banking
- Embedded Lending
- Finance As A Service (FaaS)— Tech Stack for Modern Finance Teams
- How Payments Fintech Is Using Banking As A Service To Drive Growth
- Uber’s Departure From Financial Services: A Speed Bump On The Path To Embedded Finance
- Shopify & Embedded Finance, Part 1: Analyzing Shop Pay’s Flywheel
- The Financialization of Everything
- FIS’ Nicole Jass on helping SMBs with new products and features during this crisis
Fintech News Sources
I remember when we just had a few sources to go to. TechCrunch, PYMNTS, First Annapolis, Ron Shevlin, and Jordan McKee.
Now we have a lot more:
- a16z Fintech. Soo much greatness. Alex Rampell, Angela Strange, Seema Amble, Rex, and others.
- 11:FS newsletter, podcast, blog, and Twitter. Their latest report on BaaS is 🔥 (h/t Will White & Cokie). Sam Maule, Simon Taylor, and others.
- ARK Invest newsletter, podcast, and analysts like Max, George, and Yassine.
- This Week In Fintech newsletter by Nik Milanovic.
- Fintech Today newsletter and Twitter by Ian Kar and Cokie Hasiotis.
- FT Partners newsletter and Twitter.
- Tearsheet newsletters, podcast, and Twitter.
- Breaking Banks podcast.
Here’s where the action and opportunities are.
I don’t actually love the term because its popularity significantly lagged its existence. In a way, Fintech and Embedded Finance go hand in hand. They always have. I actually think most Fintech is a form of Embedded Finance. Financial services have long required partnerships and the compiling of building blocks from different companies or services to form an actual working thing of value. Financial services have always been built on top of a foundation of mutualistic relationships. And as we all know, non-financial companies all have financial components. They’ve always needed the ability to store and move money in and out.
Nonetheless, the phrase ‘Embedded Finance’ is picking up speed and has made way for the phrase, “everything is fintech.” Check out Disrupting Financial Services– Every Company will be a Fintech Company from a16z’s Angela Strange. BaaS and other service-based components in the stack are key enablers of modern embedded financial services.
Embedded Finance is all about leveraging a partner to your benefit, to your customers benefit, and often, to the benefit of at least one other party too. Party A brings the fintech, and Party B brings the distribution– a network filled with thousands of Party C’s. Those in the network benefit from the fintech, the network operator benefits by the network benefitting, and the fintech operator benefits from the growth. Often times, the fintech operator is actually built on top of one or many other services, which is why I said that at least one other party often benefits as well (Party D, E, F, etc.). It’s actually a beautiful thing.
Software business models are evolving. Fintech isn’t only evolving with them but can serve as a flywheel to accelerate evolution. Angela wrote, “Embedding fintech (rather than just reselling) improves margins and makes the product stickier.”
Said differently by Don Richard, “Embedded fintech should also be called embedded distribution.” The great team at Finix helps us visualize the evolution specific to payments.
It seems like we’re near the inflection point for modern embedded finance (h/t Dempsey). It’s mostly due to the “possible maturation of platform technologies.” But also “emerging behaviors from generational shifts” as demonstrated by the beloved flagship example of Uber making the rider and payment experience near-frictionless.
BaaS (Banking as a Service)
This 11:FS report is the holy grail. There’s no additional color for me to provide. 11:FS crushed it, and I have a ton I need to learn about the current offerings.
“Banking as a Service (BaaS) is the provision of complete banking processes (such as loans, payments or deposit accounts) as a service using an existing licensed bank’s secure and regulated infrastructure with modern API-driven platforms.”
Similar to what Angela highlighted above, here’s what the stack looks like:
Here’s the evolution towards everything and everyone becoming fintech:
Here’s an example of what I meant when I said Party D, E, F, etc. benefit too:
Marketplaces & Platforms
I still get a kick out of transacting on a marketplace like eBay or Swappa. Buying and selling to someone across the country or world is just one of those magical digital experiences. One of my favorite things about marketplaces is that they [usually] help to level the playing field, and I’m a fan of anyone or anything that helps create opportunities for those who need help doing so. They also make for amazing businesses at scale that can last a very, very long time. Look at Craigslist and eBay. Platforms are here to stay but are evolving– they’re being unbundled as explained by a16z in articles such as Platforms vs Verticals and the Next Great Unbundling.
New opportunities are emerging every year.
Neo / Challenger Banks
What’s the difference? Amanda James details this for us in Neo Bank Vs Challenger Bank:
- “Neo banks do not have a brick-and-mortar physical structure at all. Challenger Banks, though small in size, are physically present.
- Neo banks do not have a banking license but rely on a partner bank to operate. A Challenger bank has a full banking license to operate the full suite of banking operations.
- Neo banks tend to focus on a particular customer segment like SMEs, but Challenger banks cover the entire gamut of banking operations.”
We obviously have far more neo banks here in the US than challenger banks (is Varo the only one? Will Square Financial Services count?).
At least a dozen neo banks have been born here in the US in the last decade. Simple is a crowd favorite and was the pioneer of consumer neo banks.
Although not exactly relevant to the neo bank topic, it’s worth noting that leveraging a sponsor bank to offer financial services isn’t new. For example, Bill Me Later had been doing it since the early 2000s with banks like CIT Bank and WebBank.
One of the best things about neo banks is they’ve upped the table-stakes for a banking experience, especially for consumers. It appears like there’s been a lot more neo bank action on the consumer side than the business side in the past few years. Maybe this is because PayPal has been so dominant for so long. Historically, startups have led the neo bank charge powered by progressive, innovative banks. But large tech companies have been watching and will be getting involved. Google just announced their upcoming entrance. Never underestimate the power and value of distribution.
Wow, you’ve read this far? Quarantine must have you thirsty for some new content. I feel ya.
So, how does Wise fit into all of this?
Wise is operating at the intersection of all these trends– Embedded Finance, BaaS, Platforms, Marketplaces, and Neo / Challenger Banks. More specifically, Wise is focused on Embedded Banking by offering a BBaaP– “Business Banking as a Product”. Might as well throw SaaS in as well. And instead of playing in the consumer space, Wise is B2B2B.
Remember that article I included above about Intuit launching QuickBooks Cash? It makes a lot of sense for Intuit to offer this product to their existing customer base. It’s a win for them, it’s a win for the businesses in their network (aka their customers), and it’s also a win for Green Dot Bank. But this surely wasn’t easy or cheap for them. It probably took them a couple of years. Their recent announcement was pretty exciting for me to see because it validated the thesis and market need for Wise.
Wise essentially enables any platform or network operator to offer a similar type of product. In the example of Intuit, they could have partnered with Wise to offer QuickBooks Cash. Few differences– it would have powered by Wise and instead of Green Dot Bank, the sponsor would have been BBVA. Wise would have worked with them to craft the experience to their liking, would have generously shared revenue generated by the accounts, and would have largely owned the integration, bank sponsor relationship, and compliance needs. Intuit could have offered a similar product with a fraction of the people and cost. And although Intuit likely doesn’t need Wise, we know many other platforms or networks with business customers will choose to partner with Wise. It makes too much sense not to.
Like most places I’ve worked, Wise is based on a Win-Win-Win thesis. These are my favorite types of businesses even though they’re complex under the covers. I firmly believe that a focus on mutualistic relationships and partnering sets startups up for success far more than those who aren’t. The team at Wise get’s that. Co-branding and partnering is in their DNA, and we’ll be laser-focused on creating these winning relationships. As demonstrated by HubSpot in How to Create Win-Win-Win Partnerships, it requires spotting the gap, finding your flywheel, focusing on depth over breadth, and then expanding strategically.
|Win #1: |
|In the example above, Intuit. As the network operator and/or platform, they would get to offer a value-add product suite to their existing customers, earn revenue from it, and do it easily and quickly. When partnered properly, Wise should essentially create a flywheel for a platform operator that helps power their growth.|
|Win #2: |
|Those who bank with Wise enjoy a leveling up of table-stakes for a business bank account. Digital only. Fast. Beautiful. Fully featured. High-quality customer service. Just about everything needed for a modern business to mindlessly bank, pay, and get paid.|
|Win #3: |
|Wise is currently partnered with BBVA. This case study sheds light on the relationship. The BBVA Open Platform BaaS offering is a great example of a bank innovating. By opening up their services, partners like us can originate accounts for them. In the future, Wise could easily add additional sponsor banks as needed, which can be a great method for banks to effortlessly extend their reach and grow their business accounts.|
|Win #4: |
|There’s gotta be something in it for us, right? No need to hide from it. We’re a SaaS business. We’ve built a great product that our early business customers already love. And as we work with platform partners to craft offerings that make sense for them and their customers, we’ll scale very nicely (aka we’ll be very profitable).|
|Win #5: |
Other Service Providors
|As I’ve learned over the years, no fintech company truly builds everything themselves. You intelligently leverage the best services and data to help with things like KYC and KYB. As Wise grows, so will the services we leverage.|
What I love about Wise
Now that you know what Wise offers, let me tell you why I’m so excited to join.
I’ve long loved marketplaces and networks, as well as small businesses. I actually wrote about why in this post earlier this year. Also, wise is a fantastic example of Embedded Finance which we should all be ‘sold’ on at this point. But if you’re not, this recent Forbes article highlights an excerpt from a Lightyear Capital report estimating “that embedded finance will grow to nearly $230 billion (in revenue) by 2025, up from $22.5 billion this year.”
In his two-part series, Fintech: The Fourth Platform, Matt Harris wrote “If the analysts are right, and 40 percent of the payments industry will move to an embedded model, and if we stipulate that lending and insurance will reach, say, 20 percent each, then this fourth platform shift — whereby fintech underpins all software companies — will be the big one… With the potential to create an entirely new landscape across technology, financial services and across every segment of the economy, we believe that every founder should be trying to figure out how to get ahead of this transformation and figure out their essential role in this next great platform shift.” I love that Wise is doing exactly that.
The Stage and Product
Wise isn’t like Blispay, where I joined when we were pre-product. Wise has both a product and customers. Wise also has revenue. And unlike many media-hungry fintech startups, Wise isn’t a waitlist. I love the product and believe in their thesis that we’ll be able to partner with platforms that would love to offer business banking capabilities to their customers. But Wise has a lot of work to do and distribution nuts to crack. We have to execute, refine our offerings, and grow the business. And I love this stage.
The product offering is extremely comprehensive and impressive given the age of the company. That only happens by having incredible people. Arjun Thyagarajan is the Founder & CEO, and Raghav Lal is the President. I’ve been incredibly impressed by their demeanor, authenticity, product mindset, and vision. They might be two of the most under-the-radar operators in the Bay area. And co-branding and partnerships are in their DNA. After all, Raghav spent 10 years at Visa and another 10 at American Express. I have a lot to learn from both of them and am very much looking forward to that.
A great product, team, space, and role were probably enough, but it was an extra confidence booster to see top investors participate in their last round like Base10 and AbstractVC. Plus, Mengxi told me that Base10 was one of his favorite under-the-radar firms. That type of endorsement goes a long way.
I’m at the point in my career as a product manager where you usually need to decide if you want to remain an IC or become a manager. Crossing the Canyon is a great article on the topic.
This would be especially true if I were to head to a large company next (not necessarily all, but many). And quite frankly, I haven’t been able to make a confident decision on this for the past year. I love being an IC but I also have natural leadership qualities, and always end up leading teams one way or another. So my answer has been that I want to be both! Anyway, I didn’t really need to decide for my role at Wise. My role should be a pretty natural next step in my career journey. I’m joining as a Lead Product Manager, will be the first Product hire, and will be reporting directly to the CEO. I’ll be getting my hands dirty and I’m happy to let him continue serving the head of Product role. And we’ll see how things evolve as the company grows. We’ve got work to do, a company to build, and that’s all that matters right now.
I’m the type of person who craves intellectual stimulation (especially in our world of quarantine), and this role should certainly satisfy that. I’m excited to become more well rounded by spending time away from consumer credit and B2B2C, and diving deep into business banking, B2B2B, BaaS, marketplaces, and platforms.
I created a list 6 months ago to help me evaluate job opportunities and figure out where I’d be happy next. Wise nailed all of them.
- Working on something useful, interesting, and relatable/relevant.
- Learning opportunities, new skills, and new ways of working.
- New people network.
- Consideration for ‘non-conventional’ opportunities.
- Lifestyle and Quality of life (I’ve only been open to Remote work).
- A ‘good’ place to work where people can trust management, teams are engaged, and people are respected and happy.
- Proper risk/reward profile.
Well, you somehow made it to the end. I don’t really have a great way of closing this out and it’s time to get to work, but kudos to you for getting this far.
- Wise is hiring.
- Inquire about partnering with Wise if it could make sense for you to offer banking to your network of businesses.
- Open a business bank account with Wise.
- Message me if you think I can provide any actionable product management career advice. Also, my blog has a lot of advice and practical examples. I like paying it forward.
Recognize the Power of Writing
I started blogging again at the end of last year following a several year hiatus. There are many benefits to blogging that shouldn’t be underestimated.
- It’s a great way to organize your thoughts and keep yourself in check.
- It has the amazing benefit of being able to help others in ways you’d never be able to predict.
- It creates interesting opportunities. It actually helped bring me to Wise.
So if you’re interested in writing, just go for it. Be genuine. Do it for the right reasons. Do it for yourself and for the stranger who might be able to relate.