Cracking the Fintech Code: Secrets to Success for Start-ups

FinovateFall welcomed over 70 start-ups to demo exciting new products and ideas, and opened the stage to pioneering thought-leaders to discuss the future of finance, technology and how the two come together to solve real world problems. We sat down with leaders of inspiring start-ups to get their insight on what the recipe for success is this often overcrowded space.

Matt Armstead, Executive Director, Founding Member, Board Member, FintechAccel gives his advice to start-ups and explores why getting a great team behind the idea is critical.

Jon Zanoff,  Managing Director, Techstars on knowing when a start-up is re ready to take a next step and join an accelerator.

Pini Yukeul,  CEO of Optimove, on how AI helps with segmentation, prediction and optimization within marketing and how start-ups and established businesses can leverage it.

Friday Fun: Top 12 U.S. Cities for Fintech Startups

Yesterday, Bank Innovations named five emerging U.S. fintech hubs (outside NYC, Silicon Valley and Boston). Its up-and-comers were: Atlanta, Austin, Lincoln, Miami and Washington DC. While Austin and Atlanta made sense, I was surprised by Miami, DC and especially Lincoln, Nebraska.

The article didn’t include a methodology, so to test their hypothesis I searched AngelList’s database of fintech and financial services startups (financial technology, financial services, payments, fin tech or insurance). Miami did in fact make the top 12, but Lincoln (7 startups) and Washington DC (9 startups) are pretty far out of the running, at least from a startup perspective. Admittedly, Bank Innovations was considering more than just startup activity.

Here’s the 10 most common U.S. homes of fintech startups outside SF and NYC:
(Note: this is by no means clean data, so consider it a proxy only; also it does not include neighboring cities such as San Jose or Brooklyn.)

HQ/Number of Startups

  1. NYC 1,367
  2. San Francisco 1,241
  3. LA 431
  4. Chicago 267
  5. Boston 246
  6. Austin 226
  7. Atlanta 161
  8. San Diego 156
  9. Palo Alto 136
  10. Seattle 116 (tie)
  11. Dallas 116 (tie)
  12. Miami 107

Source: Angel List, 18 Aug 2017

Enjoy your weekend all!

Author: Jim Bruene is Founder & Senior Advisor to Finovate as well as Principal of BUX Advisors, a financial services user-experience consultancy. 

Photo credit, LA Fintech Meetup Aug 22


The 85 Fintech Graduates of Y Combinator (YC): 2005 to 2016

yc slogan

Update: See here for full-year 2016.

Y Combinator (YC) continues to be the most important incubator in the general technology space with high-flying alums such as Airbnb, Dropbox and Instacart. YC is less well known, but equally successful in the fintech vertical with Stripe and Zenefits, along with two Finovate alums, ZenPayroll and Coinbase, all in the $500+ million club (based on most recent funding).

Those big wins are all the more impressive, given the smaller universe of fintech companies incubated at YC—less than 10% of its total (see table below). YC has hatched just 85 fintech companies (see list below), most in the past 30 months.

Going forward, it will be interesting to see how well the new crop of specialized fintech incubators does in attracting promising new fintech companies. Does backing from Barclays or Wells Fargo trump the halo effect of a YC investment? We’ll soon find out.


Table: YC Fintech Companies by Year

Class Total Companies # Fintech Companies % Fintech
2016 (1st half) 119 13 11%
2015 201 22 11%
2014 109 13 12%
2013 83 9 9%
2012 117 8 7%
2011 89 7 8%
2010 61 6 10%
2009 39 1 3%
2008 43 1 2%
2007 32 2 6%
2006 17 0 0%
2005 8 1 13%
Total 918 85 9.3%

Source: Y-Combinator (, Finovate analysis
(see note 1 for Fintech definition)


List: YC fintech alums by year

2016 (first half)

  • Bonsai: Invoicing and payments tool targted to freelancers
  • AlphaFlow: P2P real estate investment manager for individual investors
  • Cover: Insurance-on-demand using a smartphone camera
  • Emburse: Corporate prepaid cards that enforce spending rules
  • flexReceipts: Digital receipt platform
  • Landed: Crowdfunding platform for mortgage down payments
  • LendEDU: Student loan portal
  • MeterFeeder: Enables all parking meters to accept credit cards
  • PayStack: Online card processer in Nigeria
  • PocketSuite: Small businesses payment, invoicing, bookin and communication application
  • Stilt: Personal loans for international borrowers living in the United States
  • TrueBill: Subscription payment management for consumers
  • WorldCover: Crop insurance for the developing world



  • Abacus: Say good-bye to expense reports
  • BillForward: A highly flexible and unified billing platform; built for high growth and enterprise companies
  • BitAccess: The easiest way to buy and sell bitcoin
  • BlockScore: Real-time identity verification and due diligence
  • ClearTax; The easiest way to e-file income tax returns in India
  • Blockchain ID. A better identity
  • Shift Payments: Shift Payments is changing the way money changes hands
  • Sliced Investing: Sliced provides technology to help financial advisers deploy alternatives
  • TradeBlock: Digital currency data and analysis
  • Two Tap: Users can now order any product directly in your app with Two Tap
  • Zen99: 1099 tax help for rideshare drivers, delivery drivers, housekeepers, and more
  • Zidisha: Online microlending community
  • Zinc: Pay with with Dwolla or Bitcoin, and manage all your orders in one place



  • Airbrite (exited): Cloud-enabled platform for mobile commerce
  • Coinbase: Bitcoin wallet and exchange
  • Crowdtilt: Allows users to pool funds online
  • Eligible: Real-time eligibility checks for health insurance
  • FundersClub: Equity crowdfunding marketplace
  • LendUp: Reinventing the payday-lending industry
  • SmartAsset: Bringing full transparency to the financial decision-making process
  • ZenPayroll: Modern payroll


  • DebtEye: Automated credit-counseling solution
  • Giftrocket: Gift card that works at any location
  • GoCardless: U.K.-based service for merchants to set up interbank transfers for customers
  • Leaky: Helps consumers make better decisions about insurance
  • OrderAhead: Order from local merchants on your phone
  • TrustEgg: Simple way to save for a child’s future
  • SwipeGood: Enroll credit and debit cards to automatically round up every purchase to the nearest dollar for charity


  • CardPool (exited): Gift card exchange marketplace
  • E la Carte: Tablets for restaurant point-of-sale
  • FutureAdvisor (exited): Robo-adviser
  • Indinero: Accounting, taxes and payroll for small business
  • ReadyForZero (exited): Helping people control and reduce debt
  • Stripe: Developer-friendly way to accept payments online


  • WePay: Online payments platform


  • Tipjoy (dead): Social payments engine for digital content



  • TextPayMe (exited): SMS payment service acquired by Amazon


1. We are using a broad definition of fintech including payments, insurance, investing, etc.
2. A few YC companies are in stealth mode, so this list is not complete.

The 40 Fintech Graduates from Y Combinator (YC)

image By most measures, Y Combinator (YC) is far and away the most important incubator in the technology space. Graduating from there is like facing the job market with a resume boasting summer internships at Google, Facebook AND Goldman Sachs. You are almost guaranteed a multi-million funding.

Fintech (note 1) has been part of YC from the beginning. The first class (Summer 2005) included one fintech startup, TextPayMe, among the eight companies. TextPayMe was acquired shortly thereafter by Amazon for a rumored $3 million.

But as YC grew from 2005 to 2009, the number of fintech companies stayed at roughly 1 per year. During those five years, YC graduated 5 fintech companies out of a total of 139 (3.5%). Suddenly in 2010, the fintech number grew dramatically, average of more than 7 per year. During the past 4.5 years, there have been 35 fintech startups out of a total of 406 (8.6%) (see note 2). 

Table: YC Fintech Companies by Year

Class Total Companies # Fintech Companies % Fintech
2014 (half year) 56 5 9%
2013 83 9 9%
2012 117 8 7%
2011 89 7 8%
2010 61 6 10%
2009 39 1 3%
2008 43 1 2%
2007 32 2 6%
2006 17 0 0%
2005 8 1 13%
Total 545 40 7.4%

Source: Y-Combinator (, Finovate analysis 
(see note 1 for Fintech definition)


List of fintech YC alums by year

2014 (Winter class only)

Say goodbye to expense reports.

Digital currency data and analysis. TradeBlock’s digital currency tools and research are trusted by hundreds of thousands of traders and enthusiasts across the globe.

Two Tap
Users can now order any product directly in your app with Two Tap.

We are pioneering the first online microlending community to connect lenders and borrowers directly across international borders – overcoming previously insurmountable barriers of geography, wealth and circumstance.

Zinc is the best way to buy. Pay with with Dwolla or Bitcoin, and manage all your orders in one place.


Trade bitcoin with ease.

PayTango links the cards in your wallet to your fingerprints.

Featured investments available for funding.

Simple health insurance for small businesses.

Standard Treasury
APIs for commercial banks.

Swish is a dynamic, specialized mobile payment company that has developed a ground breaking new card reader and application which provides a complete mobile point of sale solution to any size business.

True Link Financial
We keep a watchful eye out for fraud and spending mishaps so you can spend your time doing what matters.

We aim to give everyone – regardless of wealth – the opportunity to invest in startups.

Zenefits runs your benefits, so you can run your business. Get affordable benefits for your company in minutes. Then set and forget them.


Airbrite is a cloud-enabled platform that powers mobile commerce We are the next generation of e-commerce. Our mobile-firs
t API powers modern shopping.

Your Hosted Bitcoin Wallet. Coinbase is the easiest way to get started with Bitcoin.

Crowdtilt allows users to pool funds for objectives in a simple, social, and frictionless way online.

Real Time Eligibility Checks for Health Insurance.

FundersClub is a web service that gives investors unprecedented access to investment opportunities and the tools to review and invest online with ease and speed.

LendUp is reinventing the payday lending industry

SmartAsset makes life’s biggest decisions easier by bringing full transparency to the financial decision making process.

We are creating beautiful, modern payroll.


We are an automated credit counseling solution to help customers get out of debt, a little like a “turbo tax” for those who need debt relief.

GiftRocket sells a new type of gift card that works at any location.

GoCardless is a UK-based service that allows smaller merchants to easily set up interbank transfers for customers.

Leaky helps consumers make better decisions about insurance.

OrderAhead is the easiest way to order from local merchants on your phone.

The simplest way to save for a child’s future.

SwipeGood allows users to enroll their credit or debit cards and automatically round up every purchase to the nearest dollar for charity.


Cardpool is a gift card exchange marketplace where anybody can buy, sell, or trade their new or pre-owned gift cards.

E la Carte
E la Carte develops tablets for restaurant tables so guests can order, pay and play games from their seats

FutureAdvisor was founded in 2010 on the premise that investing for your future does not have to be difficult or expensive.

Accounting, taxes & payroll. One solution. inDinero is your company’s accounting department.

ReadyForZero creates online financial software that helps people control and reduce debt.

Stripe is a simple, developer-friendly way to accept payments online.


WePay is an online payments platform for individuals, organizations, and businesses.


Tipjoy was a simple, social payments engine that allows merchants to sell digital content and features, charities to raise money for causes, and individuals to give money to one another.


Buxfer is the next-generation personal finance solution, taking money management to the web.

SocialPicks provides individual investors with a trusted online investing community where they can invest smarter together.


TextPayMe was an SMS payment service that lets you send money to other people using cell phone text messaging.


1. We are using a broad definition of fintech including payments, insurance, investments, gift cards and even a few that are ecommerce focused such as E la Carte which is an order entry and payments play for restaurants.
2. Some YC companies are in stealth mode, so this public list is not 100% complete.