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Listen To My Story

Why FinTech is the WORST.

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I’m a fintech entrepreneur and investor. I’ve been amazed how much interest this space has had over the last year. It’s like fintech has become THE place to “disrupt”.

While it’s great to see the pool that I play in get so much attention, I often times find myself arguing against it. FinTech is really hard and the hubris I see in entrepereneurs and investors entering the space makes me worry that people have no idea what they’re getting into. Here’s why.

  1. FinTech businesses don’t scale quickly. If you look at all the successful and hyped verticals of fintech and compare the marketshare of those startups vs the incumbants, its almost laughabale. Add all the loans originated by marketplace loan companies (LendingClub, Sofi, Prosper, etc) and compare them to one of the US banks. It’s not even close. Add up all the assets of the roboadvisors (wealthfront, betterment, etc) and compare that to just Merrill Lynch — its not even close. There are even individual team FA’s that have more assets than the entire robo industry. Do the same in payments, exchanges and trading. I LOVE all these businesses, but they are so far from truly distrupting.

Careful hunting…

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