While the digital transformation has waged its war of change across all industries, in few sectors are the effects of this trend more evident than in FinTech. To illustrate this point, consider this statistic: In 2010, US FinTechs garnered less than $1 billion in venture funding; by 2020, that number skyrocketed to $20.5 billion.
In this blog series, we’ll explore the meaning behind these numbers and shed light on the opportunities that await.
Better Infrastructure Enables Innovation
We’ve come a long way from FinTechs needing to spend millions of venture funding and years of development solely to get their product to market.
Now, integrated infrastructure has drastically cut engineering build and maintenance time into a single API. What does all of this saved time, money, and resources allow for?
Innovation. And lots of it.
Now, more than ever, FinTechs can dedicate larger and larger chunks of time and effort into addressing user segments that may have been traditionally left behind—all while enjoying a significantly decreased cost to deliver their products.
Examples of such innovation in recent years abound. For example:
- As neo-banks began to launch, they realized the need to connect to existing bank accounts birthing account aggregation. Enter, Plaid.
- As neo-banks grew, they soon discovered that the Lifetime Value of a direct deposit account was significantly higher than a regular account. Enter, Pinwheel.
- As the user base continued to expand globally, it became imperative to “Know Your Customer.” Enter, Persona.
- As audiences materialized and many brands began to issue their own cards, “issuing-as-a-service” was born. Enter, Marqeta.
- And so on.
Regardless of the specific vein of innovation, there is one common, uniting feature that helped make all of them possible: a deep, sound, and effective infrastructure that rapidly increased time-to-market.
Going forward, it’s expected that FinTech infrastructure will continue to be a thriving business model as it “lends itself well to developer-led growth and unit economics that scale with end customers.”
Looking for world-class talent in the fintech and lending space? Martin Executive Recruiting has the expertise and network to connect you with your ideal hire. Get in touch with us today and learn what we can do for you.