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Building Financial Inclusion: Elizabeth McCluskey, Director of the Discovery Fund at CMFG Ventures

By David Penn Posted on August 17, 2022
Categories: Diversity in Fintech, Interview, Speaker series, Women in Fintech

What is venture capital doing to help promote fintech innovators who come from underrepresented groups and communities?

We caught up with Elizabeth McCluskey, Director of The Discovery Fund at CMFG Ventures, to talk about her work in supporting underrepresented entrepreneurs that are building solutions to drive financial inclusion.

We discussed her own extensive experience in financial services, working in both investment banking and wealth management before moving to venture capital. We also learned why she believes it is important to invest in female founders and founders from communities that are underserved by traditional financial institutions.

Why did you decide to transition from investment banking and wealth management to venture capital? What do you enjoy about working at a venture capital firm?

Elizabeth McCluskey: Investment banking is transactional. I enjoyed being part of transformational deals for companies but missed being there for the long-term impact. When I pivoted to wealth management, I was able to develop more longevity in client relationships, but the investments were focused on public equities with which I had minimal connection. These experiences led me to find the ideal balance in venture capital. Now I can build more intimate relationships with portfolio companies and invest in people and ideas that are meaningful and important to me. It brings joy and satisfaction to support their long-term growth and success.

Tell me more about your current role at CMFG Ventures and the Discovery Fund.

McCluskey: CMFG Ventures is the venture capital arm of CUNA Mutual Group. CMFG Ventures invests in fintechs to help financial institutions grow and provide a brighter financial future for all. The firm adds value to fintechs by leveraging its well-established network of over 6,000 financial institutions and suite of complimentary technology solutions. Since 2016, CMFG Ventures has invested in nearly 50 fintech companies and its Discovery Fund has invested in 14 additional early-stage companies led by BIPOC, LGBTQ+, and women founders.

I am the director of the Discovery Fund. The Discovery Fund was created to support underrepresented entrepreneurs who are building solutions for financial inclusion. We plan to invest $15 million over the next three years in early-stage fintech companies. Through my role, I’m able to see the full scope of venture capital investing, including but not limited to:

Sourcing deals and meeting entrepreneurs
- Conducting due diligence
- Negotiating the terms of the deal
- Providing long-term support for entrepreneurs’ journeys by helping them scale, network, and find the resources they need to continue to succeed.

Why is it important to invest in diverse founders, especially women-led businesses? And what qualities you look for when investing in these companies?

McCluskey: Women entrepreneurs receive less than 3% of venture capital funding. This staggering number demands that we take a step back and focus on supporting diverse founders, especially women-led businesses, to improve equity in the venture capital space. This is not just the right thing to do – it’s good business. A 2018 BCG study concluded that women-founded businesses yielded two times as much revenue per dollar invested as those founded by men.

Women and diverse founders who have been historically underserved by traditional financial services are working hard to create the financial inclusion they wish they had. We are investing in entrepreneurs like them who are deeply connected to the problems they’re solving. Empowering underrepresented leaders is already creating new opportunities for liquidity management, wealth management, credit access, asset protection, and more.

Can you share more about the women-led businesses that CMFG Ventures invests in and supports? How are they helping make the financial services industry more inclusive?

McCluskey: CMFG Ventures has made investments in multiple women-led companies, such as The Beans, Climb, Caribou, and Frich to help the financial services industry become more inclusive.

The Beans simplifies the path to financial balance through evidence-based design and cutting-edge technology, so consumers stress less about money and focus on what they love.
Climb is a student lending and payments platform intended to make career education more affordable and accessible.
Caribou enables financial advisers to engage their clients in healthcare planning to support life transitions and build stronger financial futures.
Frich makes money social. It helps Gen Z develop better financial habits leveraging the power of community and benchmarking.

These female-driven fintechs are transforming the financial services space and improving the financial lives of everyday Americans.

What advice do you typically share with women founders? What about those looking to break into the VC space?

McCluskey: I would give the same advice to women founders as I do with men: always ask for feedback, especially to better understand why someone is telling them “no”. Founders who send updates over time allow me to track their progress, including growth and consistency of their business plans. In several cases, I’ve ended up investing in companies that I passed on in earlier rounds. And even if someone says “no” to doing business together, they can still be a valuable ally. Attempt to stay in touch and leverage their networks. People are often willing to share their connections and provide valuable guidance.

As for those looking to break into the VC space, I believe it is slowly becoming more inclusive and representative, yet it is still a very network-based profession. Similar to my advice for entrepreneurs, start with one person you know (or cold outreach via alumni networks, common interest groups, etc.). From there, ask every person you talk to for an introduction to at least one other person. Focus on growing your network with the goal of building genuine relationships, not necessarily getting a job right away. This is a long-term investment in your career.

We’re more than halfway through the 2022, what do you predict for the rest of the year?

McCluskey: After record levels of investments in 2021, we all knew things had to cool off. However, I believe the pace at which this has happened surprised VCs and entrepreneurs alike.

In fact, startup funding has fallen by 23% over the last 3 months, bringing us back to 2019 levels. For many, it probably feels like the sky is falling, but there is still a significant amount of money in circulation. Venture capitalists today, and by extension founders, are more focused on “real” metrics versus vanity metrics when deciding which companies to fund. The companies that will do well in the second half of the year will have measurable revenues, not just wait lists, and will be managing costs and runway to drive profitability, not endless cash burn.

Photo by Dom J

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Get Gatsby: Social Investment Platform eToro Acquires Option Trading App for $50 Million

By David Penn Posted on August 17, 2022
Categories: Alumni News, Daily news, eToro, Mergers & Acquisitions

Social investment platform eToro inked a definitive agreement to acquire stock and options trading app Gatsby for $50 million.
U.S.-based Gatsby offers a commission-free, stock and options trading solution geared toward Millennial and Gen Z investors and traders.
Making its first Finovate appearance in 2011, eToro has won Best of Show in every one of its six appearances on the Finovate stage.

Social investment platform eToro has agreed to acquire Gatsby, a U.S.-based, commission-free, stock and options trading app. The Israel-based company, which has won Best of Show awards in every one of its six appearances on the Finovate stage since 2011, will pay approximately $50 million for the trading company.

As part of the transaction, Gatsby’s co-CEOs and co-founders Jeff Myers and Ryan Belanger-Saleh – along with other senior Gatsby staffers – will join the eToro team. The acquisition of Gatsby will enable eToro to diversify its offering to investors and traders in the U.S., a factor that eToro CEO Yoni Assia called “a strategic focus” for his company.

“Through Gatsby we can provide U.S. users with access to a safe and simple way to trade options,” Assia said, “which we know are particularly attractive in challenging markets.”

Geared toward younger investors and traders, Gatsby was founded in 2018 as a way to bring commission-free options and stock trading to a demographic that has been overlooked until recently. Company co-founder Belanger-Saleh credited eToro as an inspiration for launching Gatsby, calling eToro a social investing pioneer and “the cool older sibling we’d love to hang with.” Joining the eToro team will be Gatsby’s president and chief operating officer (both co-founders), as well as Gatsby’s Chief Technology Officer, Head of Product, and others.

“We are incredibly excited to welcome the Gatsby team to the eToro family,” Assia said. “We have a shared mission of empowering investors through simple, transparent tools.”

The acquisition announcement from eToro comes less than a month after the company launched its private equity portfolio that enables individual retail investors to access private markets that would be otherwise inaccessible to them. eToro’s Private Equity Smart Portfolio gives users exposure to 14 publicly listed asset management and investment companies that manage alternative assets. These firms, including Apollo Global Management, Blackstone, and The Carlyle Group, all feature strong ROIs and get their revenues via a combination of management fees for asset allocation and performance fees based on realized profits.

“Our goal is to open the global markets so that everyone can trade and invest in a simple and transparent way,” eToro Head of Investment Portfolios Dani Brinker said. “With this portfolio we want to leverage the wave of private equity company listings and offer our users a new solution to diversify their portfolio and gain exposure to the revenues generated in private markets.”

Founded in 2007, eToro currently has more than 28 million registered users who share their investment strategies and make it easy for market newcomers to buy, hold, and sell assets ranging from stocks to cryptocurrencies.

Photo by Haley Black

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Card Transaction Data Provider Facteus Earns Plaudits for Pulse

By David Penn Posted on August 16, 2022
Categories: Alumni News, Alumni profile, Facteus

A year ago, an Oregon-based fintech called Facteus made its debut at FinovateFall 2021.

“Finovate was started with the idea of showcasing new and exciting innovation in financial services,” Facteus VP Steve Shaw said as he began his company’s demo. “And we’ve seen a lot of great ideas in technology over the past couple of days.”

“But what’s that one thing that ties all of this innovation together and really makes it work?” he asked. “It’s the data behind all this innovation. If you don’t have access to the right data, a lot of this innovation is just for show.”

Founded in 2010, Facteus leverages a massive debit and credit card transaction data set to offer hedge funds, researchers, marketing professionals and others unique insights into the consumer economy. With more than eight years of historical data and 42 billion transactions processed – representing $1.3 trillion in consumer spending – Facteus provides insights into consumer segments, such as youth and the underbanked, whose financial behavior is often overlooked or underappreciated by other data sets.

At FinovateFall 2021, Facteus demoed its MIMIC synthetic data engine, which leverages machine learning to create an artificial copy of sensitive data, removing personally identifiable information (PII). The synthetic copy can be used for analytics, machine learning and AI, segmentation activities, and other data operations, but cannot be reverse engineered back to the original transaction or organization.

“Data is really the fuel for all the innovation we are seeing,” Shaw said. “We truly believe that and we have examples to show that synthetic data is really the key to unlocking the value of your sensitive data.”

Facteus began this year teaming up with 1010data to provide enhanced transaction data insights and analytics to companies in the investment, retail, and consumer brands businesses. As part of the strategic agreement, Facteus acquired 101data’s Equity Intelligence business, enhancing its ability to provide transaction data insights and analysis to the investment services industry. In return, 1010data gained access to Facteus’ U.S. Consumer Payments data panels to help its retail and consumer brand clients.

“Facteus data provides deep insights into the drivers behind consumer spending behavior and business trends not available in other transactional data panels,” Facetus CEO Chris Marsh said. “(Facteus offers) enhanced company analysis and investment strategies for 1010data clients and the investment services industry as a whole.”

By spring, Facteus was in the fintech headlines again, this time announcing an investment of $10 million from Curql Fund, the investment arm for more than 75 credit unions in the U.S. The company said it would use the funding to support the growth of its analytics and insights platform Quantamatics, as well as fuel continued innovation on its platform and expand into new industry verticals. The company’s investment from Curql Fund also gives Facteus access to the significant data assets of Curql Collective owners, representing tens of millions of new consumer debit and credit cards.

In May, the Beaverton-based company launched Pulse, a new consumer transaction data solution it called the most comprehensive in the alternative data industry. With Pulse, Facteus is able to capture up to 5% of all U.S. consumer spending, more than 500 tickers and 1,000+ private companies, and deliver accurate company KPI forecasts with the industry’s lowest forecast errors. A month later, Facteus’ Pulse earned its first official vote of confidence: topping the latest rankings in predictive accuracy in the KPIs of more than 65 public consumer companies.

“This accomplishment is a testament to our commitment to directly acquiring transaction datasets to build the most holistic and stable view of consumer spending across income cohorts and demographics,” Facteus Head of Product and Strategy Lorn Davis said.

Photo by Amina Filkins

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Pomelo Launches Family Credit Cards to Combine Credit and International Money Transfer

By Julie Muhn (@julieschicktanz) Posted on August 16, 2022
Categories: Daily news

Pomelo is launching a family credit card account that gives accountholders up to four cards to give to friends and family overseas.
Because the payments run on credit rails, users save on international money transfer fees.
Pomelo is launching money transfer capabilities between the U.S. and the Philippines.

Pomelo is the newest fintech in the digital banking scene. The company is launching today with $70 million in Seed funding to change the fundamentals of international money transfer.

Leading the round are Keith Rabois at Founders Fund as well as Kevin Hartz, Co-Founder of Xoom and General Partner at A* Capital. Afore Capital, Xfund, Josh Buckley, the Chainsmokers, and the Weeknd also participated.

Frenkiel, who regularly sends money to family overseas, came up with the idea for Pomelo while he was visiting family in the Philippines and thought, “Why can’t I just give a card to my family instead of having to send money through Western Union?” At that point, Frenkiel came up with a way to use credit card payment rails to disburse funds and eliminate transfer fees.

Pomelo is a family account that gives the primary accountholder up to four physical and virtual credit cards to give to loved ones overseas. Users can set limits via the app, pause any of the payment cards, and view how each member is spending their funds. Unlike many shared accounts, Pomelo is not prepaid. The primary accountholder pays for the charges on each card at the end of the month and builds their own credit as they pay off each balance.

Each account comes with a Mastercard credit card issued by Coastal Community Bank. And because the payments run via credit rails, the fees are paid by merchants via interchange and daily foreign exchange rates. This eliminates transfer fees, which can add up to 6%.

“Pomelo is on a mission to change how international money transfer fundamentally works,” said Pomelo Founder and CEO Eric Velasquez Frenkiel. “Our goal is to help our customers establish their financial future here in the United States by building positive credit history with their existing remittance obligations, and to financially include their loved ones in emerging economies with access to modern financial instruments. For many of our customers, Pomelo is their first credit card here in the U.S. and the very first card for their loved ones overseas.”

After beta testing the service for several months, Pomelo is launching money transfer capabilities between the U.S. and the Philippines.

Photo by Ron Lach

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Zogo Finance and MoneyLion Forge Partnership to Foster Financial Literacy

By David Penn Posted on August 16, 2022
Categories: Alumni News, Zogo Finance

MoneyLion and Zogo Finance announced a new collaboration to bring financial literacy tools to MoneyLion’s more than three million users.
MoneyLion will integrate Zogo’s financial education modules into the Today Feed content section of the MoneyLion app.
Zogo Finance won Best of Show in its Finovate debut at FinovateFall 2019 in New York.

Personalized financial content provider MoneyLion is the latest fintech to partner with financial literacy company Zogo Finance. MoneyLion will leverage the new relationship with Zogo Finance to bring enhanced financial education to its more than three million users. The collaboration represents Zogo’s largest fintech platform integration since the company was launched four years ago.

“Partnering with a premier (neobank) such as MoneyLion is a pivotal step toward Zogo’s goal to bolster investor education for consumers’ prosperous financial futures,” Zogo CEO Bolun Li said. “This is one of our biggest leaps in the fintech space, driving us closer to our overall mission of reinventing financial education than ever before.”

Courtesy of the collaboration, MoneyLion users will be able to access Zogo Finance’s financial education modules within the “Today Feed” content section of the MoneyLion app. A feature that combines community insights and experience with data and financial expertise, MoneyLion’s Today Feed educates and empowers users to find the most appropriate financial solutions to suit their needs and make better, more informed decisions about their financial lives. The integration with Zogo will enable users to improve their understanding of key financial concepts ranging from investing and saving to applying for loans and pursuing entrepreneurship.

Emphasizing the importance of financial education that is “approachable and fun,” MoneyLion Chief Product Officer Tim Hong praised the new partnership with Zogo. “Each customer will receive a unique lineup of content and information, and the tools necessary to help them achieve their money goals,” Hong said. “At the same time (they will) have the confidence to improve their financial health with a hyper-personalized in-app feed.”

Headquartered in Austin, Texas, Zogo Finance won Best of Show at FinovateFall 2019 in New York. At the conference, the company demonstrated its teen financial literacy app that uses behavioral economic insights derived from research conducted at Duke University to help teach otherwise complex financial concepts.

Zogo began 2022 with an announcement that it had forged new partnerships with eight fintechs and financial institutions. The company followed this January accomplishment with an even more impressive signing of 12 new partners in February. By June, Zogo reported that it had reached a major partnership milestone in inking deals with a total of 200 financial institutions.

“It’s been a true honor to support the building of local communities founded on the bedrock of education,” Li said when the milestone was announced. “Every new user we educate and every new partnership we build brings us one step closer to a better world.”

Photo by Magda Ehlers

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The Hidden Costs of Fraud and Dispute Management: Where to Automate the Process and Reduce Losses

By Charlie Burgess Posted on August 16, 2022
Categories: Finovate Webinar, Webinars

The fintech and payments industries are rapidly evolving. Isn’t it time fraud and dispute management processes did as well? Financial institutions not seeking alternatives to legacy infrastructure are constrained in their ability to automate and streamline lengthy and manual processes, such as chargeback management.

In this webinar, Quavo’s SVP, Revenue Executive Brittany Usher, and KeyBank’s Head of Enterprise Fraud Services, Jen Martin, will join Finovate’s Julie Muhn to discuss initial steps toward automation for issuing financial institutions seeking to overhaul their pre-existing manual and legacy systems. Along with providing business case examples, Brittany and Jen will elaborate on the lessons learned from implementing new software, conducting a cost analysis examining price per transaction, chargeback recoveries, manual intervention, fines, and overhead costs.

Covering:

Discover tips on the first steps to take when seeking to overhaul preexisting manual/legacy systems with real life examples and lessons learned. This is a common obstacle to implementing new software.
Learn how to set up data requirements, merchant collab software, accounting, and more.
Conduct current cost analysis – price per transaction, chargeback recovery, manual intervention, fines, overhead, and more.

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Wellness, Inclusion, and Opportunity: Third Annual Finovate Awards Celebrate the Best of Fintech

By David Penn Posted on August 15, 2022
Categories: Finovate Awards

The return of live events is delivering yet another opportunity for fintech enthusiasts and financial services professionals to rejoice: the Finovate Awards Ceremony is back!

The third annual celebration, to be held the evening of September 13th at the Edison Ballroom in New York City, will reveal the winners of this year’s 20+ highly contested categories. Check out our list of Finovate Awards finalists. In addition to honoring this year’s award winners, the event will feature live entertainment and all-evening-long opportunities for networking with new friends and old colleagues.

From digital banking and consumer lending to alternative investment solutions and excellence in decentralized finance, the Finovate Awards recognize the breadth of innovation that is driving fintech forward today. Leveraging the wisdom of more than 20 fintech and financial services experts who served as this year’s judges, the third annual Finovate Awards celebrate the organizations and individuals whose efforts are bringing financial wellness, inclusion, and opportunity to communities around the world.

Visit our Finovate Awards hub today and lock in your seat or table at this year’s event.

Photo by JESHOOTS.com

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BankiFi Preps for U.S. Expansion with Fresh $4.8 Million

By Julie Muhn (@julieschicktanz) Posted on August 15, 2022
Categories: Daily news, Funding

BankiFi announced a $4.8 million funding round today led by Praetura Ventures.
The U.K.-based company will use the funds to expand into the U.S. and inch closer toward its mission to serve two million SMBs across four continents by 2024.
The Series A round brings BankiFi’s total funding to $8.5 million.

Embedded banking solutions firm BankiFi landed $4.8 million today to help fuel its expansion into North America. The Series A round brings BankiFi’s total funding to $8.5 million. The investment round is led by Praetura Ventures and will help U.K.-based BankiFi further its mission to serve two million SMBs across four continents by 2024.

“BankiFi has proven to be an industry-leading open cash management provider in Europe, Australia, New Zealand and other countries,” said Praetura Ventures Managing Director David Foreman. “Now that they have launched in North America, BankiFi has an opportunity for dramatic growth.”

Founded in 2018, BankiFi empowers banks to offer their small business clients a cash management platform that helps with accounting, access to working capital, invoicing, and payments. By embedding a bank within their clients’ existing accounting systems, it becomes part of the business’ daily workflow.

“Our mission is to make all aspects of cash management and payments easier for SMBs everywhere, and this investment is another huge step to making that a reality,” said BankiFi Americas CEO Keith Riddle.

In April, BankiFi launched its Open Cash Management Platform, or what it calls a “super app” for small business banking that bolstered the company’s previous offering by combining embedded banking and open banking. Earlier in the year, the company was tapped by U.K.-based TSB to launch a new app that helps small businesses get paid faster.

BankiFi has offices in Ohio, Manchester, Sydney, and Antwerp, and recently appointed Tom Shen as chair of its board of directors. Mark Hartley is CEO.

Photo by Karolina Grabowska

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Paytech Finix Secures $30 Million Investment

By David Penn Posted on August 15, 2022
Categories: Daily news, Funding

Paytech Finix secured $30 million in funding last week.
The investment takes the San Francisco, California-based payment facilitator’s total capital to $133 million.
Founded in 2015, Finix includes Kabbage, Pay Theory, and Passport among its customers.

San Francisco, California-based paytech Finix announced a $30 million investment last week. The funding featured participation from both new and existing investors, and brings the company’s total capital raised to $133 million. Finix reported that it will use the new financing to support the addition of new features to make it easier for software platforms to better manage their payments and merchants.

“The next generation of fintech is all about businesses embedding financial services when and where their customers need them most,” Bain Capital Ventures Managing Director and Finix board member Matt Harris said in a statement. “Finix is a leading example of the type of state-of-the-art payments infrastructure provider that makes this embedded experience possible.”

Calling Q2 2022 its best quarter to date in terms of new deals closed, Finix helps software platforms enable and enhance payment processing. The payment facilitator’s white-label API gives companies the ability to accept payments, manage payouts, and onboard merchants, in order to help produce greater revenues from the payment process. Underwriting, reconciliation, and dispute management are also features of Finix’s platform.

The investment comes as Finix acknowledges a number of significant accomplishments. These include becoming a registered payment facilitator, doubling total annual payments volume from 2020 to 2021, and expanding its suite of in-person payment devices and capabilities. In a blog post at the company website in May, Finix co-founder and CEO Richie Serna highlighted the firm’s recent achievements, concluding “if you compared Finix to Nilson’s 2021 list of top U.S. merchant acquirers, we would rank in the top 50 based on TPV and merchant count.” Serna noted that Finix supports more than 12,000 active small businesses, schools, and places of worship each month.

Participating in Finix’s recent investment were The General Partnership (TheGP), Franklin Templeton, American Express Ventures, Acrew Capital, Bain Capital Ventures, Cap Table Coalition, Homebrew, Insight Partners, Inspired Capital, Lightspeed Venture Partners, Precursor Ventures, PSP Growth, and Vamos Ventures. Founded in 2015, Finix currently includes Kabbage, Passport, and Pay Theory among its customers.

Photo by Pixabay

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Credas Appoints Former Experian Director as CSO

By Julie Muhn (@julieschicktanz) Posted on August 12, 2022
Categories: Daily news

Credas has appointed Geraint Rogers as Chief Strategy Officer.
Rodgers formerly worked at Experian U.K., where he served as the company’s Product Director for Identity, Fraud, and Financial Crime.
Rodgers will also serve on Credas’ executive board, which includes Barnett and company CTO Kevin Smith.

Digital identity verification platform Credas is bolstering its team this week. The U.K.-based company has appointed Geraint Rogers as Chief Strategy Officer.

Credas anticipates Rodgers will aid the company in the launch of its new Digital Identity wallet later this year. Company CEO Tim Barnett said that Rodgers will “help Credas stay at the forefront of the market.”

Rodgers comes to Credas from Experian U.K., where he served as the company’s Product Director for Identity, Fraud, and Financial Crime. He has almost 30 years of experience in product development and has worked across banking, risk, and compliance departments in senior roles at both Experian and LexisNexis Risk Solutions.

Outside of his role at Experian, Rodgers currently serves as a board member of the Open Identity Exchange, helping to shape industry standards for digital identities and wallets; and he is certified with the U.K. Government’s Digital Identity and Attributes Trust Framework.

Rodgers will also serve on Credas’ executive board, which includes Barnett and company CTO Kevin Smith.

Founded in 2017, Credas offers biometric facial recognition, document authentication, and eSign technologies to help businesses across a range of sectors streamline their onboarding processes, conduct due diligence, and remain compliant.

Photo by JESHOOTS.COM on Unsplash

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Some Do’s and Don’ts of Leveraging Emerging Technologies in Fintech

By Julie Muhn (@julieschicktanz) Posted on August 11, 2022
Categories: Speaker series

Having worked in the fintech industry for four years, Kristiane Mandraki has developed a passion for emerging technology and has seen ebbs and flows of success and failure in the industry. Mandraki is currently the Director of Business Development and Marketing at Praxent, a 22-year old fintech experience design and development firm that helps financial companies succeed in their digital transformation efforts.

We recently spoke with Mandraki on some of the best practices in customer experience, digital transformation, and Web 3; as well as top trends she’s anticipating in the next year.

When it comes to customer experience, what are some of the top mistakes you’ve seen banks and fintechs make, and how can they avoid them?

Kristiane Mandraki: Banks and fintechs often make the mistake of trying to be all things for all people, which only leads to exhaustive mediocrity. Instead, it’s critical to pick a focus, your North Star. Narrowing in on a main priority or differentiator allows financial services providers to prioritize and innovate, setting the stage to truly excel at something instead of being average at everything.

Another mistake we often see banks make is implementing off-the-shelf technology without viewing the experience through the holistic lens of the customer’s journey. We see this often in account opening or loan origination experiences where the customer’s journey starts on the website and ends on the fintech product. It’s important to carefully consider the experience as part of the bank’s brand experience and ensure it’s configured in a user-friendly way. There are many opportunities to differentiate the brand by prioritizing the website and product configuration as a critical component of the digital experience which often requires UX/UI expertise.

What advice do you have for banks navigating this era that’s stuck between digital transformation and Web 3?

Mandraki: Some emerging technologies are fairly polarizing, like Bitcoin. You have the optimists and then those who see the headlines and are quick to write it off. What can’t be ignored is that blockchain technology unlocks much more than an asset class. It has created another sphere like the Internet.

The industry is currently in a transitionary period, or Web 2.5; we’re starting to evolve beyond Web 2.0 but Web 3.0 isn’t quite a mainstream reality. We’re facing a major user experience challenge, which is a huge opportunity for innovation.

There is a need to bridge the gap between banks and cryptocurrencies so institutions can offer these products in a way that’s intuitive and user-centric. No matter where bankers stand on the debate, they must educate themselves and remain open to how they might be able to leverage emerging technologies moving forward. Savvy investors are strongly considering digital assets within their wealth portfolios. In order to build trust with those clients, financial advisors in banks and credit unions must develop a strong understanding of the space to advise them responsibly.

I hope women in particular take the opportunity to help shape this new financial system to be more inclusive, especially since they weren’t in a position to do so when traditional financial systems were created.

How can banks offer digital services while maintaining human touch?

Mandraki: A primary issue is that for too long, banks have relied on experiences that are system-centric, ultimately forcing customers to jump through several hurdles to satisfy internal IT systems. This typically results in a process that is cumbersome, requiring customers to rekey information and leaving no room for human empathy.

Community financial institutions excel in customer-intimacy, as they move much of their customer interaction to the digital space, it’s critical they offer experiences that are human-centric.

 This is where exercises and tools like a customer journey map, envisioning the customer journey in the context of use, provide significant value. Once the work is done to identify points of delight and frustration within the customer journey, the proper prioritization and investments can be put in place to overhaul the experience with the customer at the center.

What are the top trends you’ve seen so far this year, and what’s coming next year?

Mandraki: Going back to common mistakes we see in financial services, an exciting trend is that many banks and credit unions are starting to pay much closer attention to their ‘digital front doors’ or website experience. Strategic institutions have started to realize that a marketing department of one or two people, usually without any user experience or design background, is simply not enough of a resource to modernize and maintain their websites. Having a modern website that shares relevant information and options with intuitive navigation is just as important as the money being spent on things like modernizing loan origination systems or account opening tools.

We are also seeing many more financial services providers striving to identify a niche when it comes to investing and wealth management. There is a massive opportunity to reach and serve this group of Millennials and Gen Z that soon stand to inherit significant wealth but who have so far been hesitant to engage traditional financial advisors.

Photo by Markus Spiske on Unsplash

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Linqto Breaks into DeFi with Trustline Acquisition

By Julie Muhn (@julieschicktanz) Posted on August 11, 2022
Categories: Alumni News, Daily news, Linqto

Linqto has acquired Trustline, a platform that offers decentralized financial services.
“We acquired Trustline for its advanced blockchain technology and IP including $200,000 worth of XRP grants issued from the XRPL Grants Program,” said Linqto Founder and CEO Bill Sarris.
Linqto plans to leverage Trustline to continue developing its decentralized exchange for private market securities.

Private investing firm Linqto has solidified its interest in the blockchain this week with the acquisition of Trustline, a platform that offers decentralized financial services. Financial terms of the deal were not disclosed.

Trustline leverages the XRP Ledger to offer payments, trading, and lending to accredited investors. Because Trustline run on XRP, it is able to offer its financial services in a more efficient and cost-effective manner than traditional firms.

“We acquired Trustline for its advanced blockchain technology and IP including $200,000 worth of XRP grants issued from the XRPL Grants Program,” said Linqto Founder and CEO Bill Sarris. “Trustline will help us build on our vision to provide access, affordability and liquidity to accredited investors. But the most valuable asset we acquired is the new association with Matt Rosendin, a progressive thinker and leader in the global blockchain community.”

Linqto plans to leverage Trustline to continue developing its decentralized exchange for private market securities. Using Trustline’s proprietary technology, Linqto’s exchange will be auditable, publicly transparent, and 100% on blockchain.

The acquisition comes shortly after Trustline abandoned plans for its stablecoins, Aurei and Phi, due to regulatory conflicts with the SEC, which viewed the coins as securities. “Trustline is thrilled to join the innovative and groundbreaking work that Linqto is doing in making private investing simple for individual investors who have been shut out of traditional private equity asset class,” said Trustline CEO Matt Rosendin. “Our two companies are perfectly aligned to democratize private markets investing for qualified investors.”

Rosendin is now VP of Ledger at Linqto.

Linqto, which now counts more than 100,000 accredited investors in its global network, enables users to invest in a range of pre-IPO startups, including Upgrade, Uphold, Ripple, SoFi, Blockchain Coinvestors, Kraken, and even in its own company. Linqto’s will demo its newest innovation at FinovateFall next month in New York. Register today to secure your spot.

Photo by Maria Lysenko on Unsplash

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