Another thrilling episode of Breaking Banks’ special series Killing It!. Host Jason Henrichs connects with fintech superstar, dare we say fintech Olympian (Paris 2024!), Bill Harris, industry veteran, founder of 10+ tech and fintech companies, author, and current Founder & CEO of Evergreen Money. Together Jason and Bill look back at Bill’s career to date, the different companies, the lessons learned and the tough calls made. Among those hard decisions, the need, at times, to avoid prolonging a failing venture and the need to conserve resources. It’s a race to the finish where Bill shares details about his latest endeavor.

Integration is a team sport these days. There is a need for constant adaptation and innovation, it can be complex and expensive, a lack of standards in the U.S. has introduced a lot of competing standards and solutions challenging business and consumer adoption. Partnerships and tighter focus can be key to bringing down cost to exchange funds and complement the current payments system with $80 Trillion processed on the ACH system in 2023, $55 Trillion of it B2B payments. Listen as Brett King catches up with Dwolla’s CEO, David Glaser and CTO, Skyler Nesheim. Dwolla was first featured on Breaking Banks back in 2013, they bring us up to date on the innovative interfaces that Dwolla offers to the US banking system and their ability to work with innovators of all sizes. It’s an interesting discussion covering RTP payments, open banking, pay by bank, connections to the ACH Network and RTP Network for institutions of all sizes.

Then Jason Henrichs chats with veteran financial services executive, founder & CEO Sanjib Kalita, about fintech events from Money 20/20 to Fintech Meetup and beyond. From best practices to the need to create the right culture and maximize the value of content and improve ROT (Return on Time), differentiation is important as is contributing to greater knowledge. Are there too many events? It’s a master class in events!

Read the entire transcript here.

The hosts kick off with an overview of the “Innovator’s Dilemma” and introduce returning guests from Doala, discussing the evolution of fintech.

Doala’s CEO and CTO reflect on their journey, highlighting the company’s shift from serving small businesses to becoming a payments infrastructure leader.

A discussion on how countries like Brazil and India are leading real-time payments, compared to the U.S.’s slower adoption and the role of standards.

Exploring how legacy systems create friction in innovation, and how fintechs like Doala provide solutions to modernize payment ecosystems.

The conversation shifts to AI’s potential in payments, including personal assistants managing financial transactions and streamlining banking processes.

The panel examines how fintechs, banks, and technology platforms collaborate to create scalable, integrated financial systems.

The episode highlights how cloud-native fintechs like Doala have a competitive edge, while legacy banks face significant hurdles in keeping up.

The hosts discuss the importance of maximizing return on time at fintech events, sharing strategies to align conference participation with business goals.

The episode wraps up with reflections on the necessity of constant innovation for survival in fintech and the banking ecosystem.

Deposits are the aqua vitae of banking, the water of life.

The very core of the traditional banking business model is gathering deposits at no to low-cost and lending the money back out at higher rates. Bankers used to reference the “3-6-3 Rule”: bring in deposits at 3%, make loans at 6%, and be out on the golf course by 3:00PM.

Money is the primary raw material in the business of banking. The difference between what financial institutions pay for that raw material is subtracted from what they earn from lending it out right at the very top of their income statements. That difference is net interest income, and it is the largest component of earnings for virtually every bank. As much as 95% or more for some.

Expressed as a ratio, the net interest margin or NIM is a key metric in measuring bank performance, and it’s been under considerable pressure lately. The traditional levers have been trying to lower deposit rates and raise loan rates, and hope you don’t lose too much volume. As the business has become more complex, so have the tools and strategies to reduce that pressure.

Today we get into some of the hidden levers that banks are using to add non-rate value, one focus is SBA lending. How new approaches and new technology is expanding the market for banks large and small, and also for fintechs; and how the secondary market is helping to improve liquidity and improve NIM. Joining host JP Nicols in this episode are Steve Tanzer and Joel Updegraff, both Managing Directors at Brean Capital.

Read the entire transcript here.

The hosts introduce net interest margin (NIM) as a critical metric for bank performance and set the stage for a discussion on strategies to manage NIM pressures.

Steve Tanzer from Breen Capital explains the role of Small Business Administration (SBA) loans in enhancing bank liquidity, profitability, and risk management.

The discussion shifts to how banks can diversify geographically and leverage national lending platforms while maintaining strong customer relationships.

An overview of how the SBA’s secondary market enables banks to sell guaranteed portions of loans, generating fee income and freeing up capital for growth.

The panel explores how fintech and “Fintech Lite” solutions are streamlining SBA lending, boosting efficiency, and expanding credit access to underserved markets.

Insights on how SBA modernized processes during COVID-19, including the shift from wet signatures to digital transactions, improving efficiency in loan settlement.

The hosts highlight examples like Live Oak Bank, showcasing how specialization in industry verticals and investment in technology yield competitive advantages.

Practical advice for banks new to SBA lending, including understanding the program’s economics, finding the right partners, and identifying growth opportunities.

The role of non-bank lenders and fintech innovations in reshaping the SBA landscape is examined, emphasizing their influence on efficiency and market dynamics.

The episode wraps up with reflections on the evolving role of SBA programs and non-rate strategies in addressing NIM compression challenges.

This Breaking Banks episode’s Killing It guest went from software engineer to investment banker to founder of a community supporting the next generation of fintech founders to adviser then founder of the fintech team at Andreessen Horowitz (A16Z) and now solo venture fund founder in the fintech space investing at the angel, pre-seed and seed stage. Meet Rex Salisbury, founder Cambrian Ventures, backing early-stage companies, as he shares his journey and founder stories — his path, motivation and the support that ultimately led him to being a solo fund founder after clearly being bitten by the fintech bug. He shares thoughts on putting talents and strengths to good use, creative destruction and how to think about failure to get you where you want and ought to be. In short, he’s killing it!

Soft landings are a topic of hot conversation these days. The go-go days where you can always raise another round are gone. The ecosystem is littered with companies with little product market fit, less revenue and even less runway. Many of these are looking for a soft spot to land. Unfortunately M&A is hard in the best of times and many fintechs are now looking to banks as a potential exit.

In the first half of today’s show, Jason Zaler, partner at Oliver Wyman, joins Jason Henrichs to discuss Oliver Wyman’s  new report on bank fintech M&A. In the second half,  Robert Antoniades, General Partner at Information Venture Partners, and Jason H talk about 3 decades of venture cycles and M&A more broadly including strategies for big banks, community banks, fintechs and even VCs.

Read the entire transcript here.

Introductory thoughts on fintech struggles and the shifting landscape of bank-fintech partnerships.

Exploring the difficulties banks face in acquiring fintechs and factors impacting M&A deals.

A deep dive into SoFi’s significant acquisitions, including Galileo and Technisys.

Outlining the playbook for integrating fintech acquisitions successfully.

Challenges fintechs and banks face in complying with emerging regulations.

Discussion on venture capital cycles, overfunded startups, and future fintech consolidation.

Predictions on soft landings, hard landings, and where fintechs are headed next.

Come for the expert views on how the Synapse bankruptcy has led to regulatory consent orders for three banks (so far), stay to find out what happens when two regulatory lawyers and a self-declared ‘bank nerd’ editor break down the issues and the lessons for the rest of the industry.

Matt Janiga from Trustly, Jesse Silverman from Troutman Pepper, and Kiah Haslett from Bank Director dive deep into what went wrong on the bank side, and what banks need to do to avoid a similar fate. Jesse has ideas for a better regulatory system, and says banks need to think beyond disclosures. Matt says banks need to step up their AML/BSA compliance systems and not try to do too much at once. Kiah gives a little history lesson and goes on a rant about how much of banks’ risk management systems are anything but. Everyone agrees with JP that banks keep stumbling over well-known issues, and that the risks of inaction are too big to ignore.

Read the entire transcript here.

The hosts introduce the episode, setting the stage for the discussion on the Synapse collapse, Evolve Bank’s consent order, and broader fintech implications.

A look at the evolution of Banking as a Service, the role of middleware, and the challenges banks face in third-party risk management.

Breaking down the Synapse bankruptcy, reconciliation issues, and the complex web of banks and fintechs involved in the debacle.

A discussion on the perceived regulatory gaps, the role of state regulators, and the absence of a unified oversight body for fintechs.

Analysis of recent consent orders issued to banks, recurring themes like AML, CIP, reconciliation, and what banks must address to stay compliant.

How fintechs and banks can work better together, focusing on due diligence, reconciliation processes, and board governance.

Exploring the potential for state regulators to create new license types for fintechs and why a federal framework might be needed.

Practical advice for banks considering fintech partnerships: start small, evaluate processes, and ensure technology and compliance alignment.

A hopeful perspective on the future of Banking as a Service, predicting a “flight to quality” and stronger partnerships through better risk management.

Final reflections on the importance of effective risk management and why banks must embrace calculated risks to innovate and thrive.

It’s a Breaking Banks and Finovate collab! Fresh off of FinovateSpring hosts JP Nicols, Greg Palmer and Brett King talk trends, takeaways and best of show; bringing the best to you in this episode. If you missed FinovateSpring, enjoy the recap and themes, and some of the best fintech innovations covering artificial intelligence, open banking, future payments, CX and more. With new market entrants and the loosening of capital, creativity is coming back into the ecosystem, and the bar is being raised, pushing everyone forward. We also introduce you to one of FinovateSpring’s Best of Show winners, Maya Mikhailov, SAVVI AI, Founder & CEO. Meeting users where they are, SAVVI AI offers a powerful AI tool to unlock data and make finserv and fintech goal driven AI use cases easier, distilling data natively into excel, to offer insights for institutions on new product offerings to benefit customers and business.

In the coming weeks, tune into sister podcast Finovate for profiles, a deep dive and one-on-ones with all FinovateSpring ‘Best of Show’ winners: Bloom Credit, Remynt, Kobalt Labs, QuickFi, SAVVI AI, Cascading AI

Read the entire transcript here.

The hosts introduce Greg Palmer from Finnovate, discussing his observations post-Finnovate Spring and setting the stage for the episode.

Exploring the influx of early-stage companies, Series A fintechs, and how creativity is driving a new wave of innovation in the ecosystem.

Discussing the classic innovation cycle, venture capital trends, and how fintechs challenge incumbents to adapt or acquire.

Highlighting AI’s role in shaping financial services, the incumbents’ challenges with legacy systems, and fintechs’ AI-friendly advantages.

A brief overview of standout winners like Bloom Credit, Remit, and Savvy AI, and their innovative, customer-centric approaches.

Maya Mikhailov shares Savvy AI’s mission to bring AI capabilities to banks through Excel, empowering them to use their existing data.

Discussing how banks can begin with deposit and transaction data to solve practical challenges like deposit growth, churn, and loan delinquency.

Reflections on the episode’s themes: AI as a tool for efficiency, solving everyday banking problems, and meeting customers where they are.

Jake Gibson, former investment banker, entrepreneur / co-founder NerdWallet, angel investor, now VC founder Better Tomorrow Ventures, who crossed career paths with host Jason Henrichs 10+ years ago, have an honest discussion about the twists and turns of co-founding a boot-strapping start-up particularly when you are young, on to something and quickly have to figure everything out. After years of hard work and being all-in, tough decisions needed to be made as NerdWallet continued to grow quickly. Jake knew it was time to move on, but so hard to do. The arrival of twins and focus on strengths, honesty, lessons learned, and giving advice to others in similar situations, helped Jake figure his calling and path forward, and has enabled him to keep many ‘cards in his wallet’. 

Read the entire transcript here.

Setting the stage for Jake Gibson’s journey, from Wall Street to co-founding NerdWallet, angel investing, and ultimately venture capital.

Jake shares his transition from a successful trading desk role at J.P. Morgan to joining Tim Chen on the early journey of NerdWallet.

Insights into the early challenges of building NerdWallet, the struggles of SEO, and how Google’s algorithm updates became a turning point.

The tough lessons in scaling NerdWallet, managing people, and navigating layoffs, despite the company’s upward revenue trajectory.

Jake opens up about the emotional difficulty of leaving NerdWallet, redefining his sense of self, and taking time to decompress.

The next phase for Jake—mentoring and investing in startups, building a network, and finding fulfillment through helping others succeed.

How Jake partnered with Sheel Mohnot, overcame hesitations, and co-founded Better Tomorrow Ventures (BTV) to support fintech innovation.

Candid advice on preparing for potential failure, embracing identity shifts, and recognizing that success often requires persistence and luck.

Jake’s thoughts on unreasonable optimism, self-awareness, and how founders should approach reinvention and uncertainty.

There’s more to episode 543 — Killing It: The Story Behind the Synapse Story — right here! The Synapse saga continues but we make it easy to stay current and benefit from expert analysis as host Jason Henrichs unpacks the latest news with Jason Mikula, publisher of Fintech Business Weekly. The two are watching the topic closely, offering insight into what it all means, from a Chapter 11 Trustee, to new account and financial resilience concerns, FDIC insurance disclosure, challenges and regulation not to mention potential risks and implications for banking and fintech. A takeaway from it all, the importance of regulation in promoting responsible innovation.

Read the entire transcript here.

Hosts Jason Henrichs and Jason Mikula set the stage for the ongoing Synapse-Evolve-Lineage saga, describing the magnitude and impact.

Analyzing the $50 million shortfall between Synapse and Evolve, the flawed ledger issues, and how the situation spiraled over time.

Exploring Synapse’s board oversight, fintech clients’ reactions, and questions about operational resilience and business continuity.

Discussing why ledgers are so complex, how ACH and settlement flows add layers of difficulty, and why banks failed to catch the discrepancies.

Examining the FDIC’s stance on insurance limitations and the lack of clear communication to consumers regarding fintech-held deposits.

Comparing U.S. regulatory gaps to Europe’s EMI licenses, and how the lack of supervision exacerbated fintech risks.

Highlighting the dangers of underprepared banks and fintech players entering the complex world of Banking-as-a-Service (BaaS).

Assessing how this saga will impact future bank-fintech partnerships, regulatory oversight, and the fintech innovation landscape.

Reflecting on the importance of regulation, investor accountability, and building robust systems to prevent future crises.

In this episode Jason Henrichs and Kiah Haslett, Bank Director’s Banking and Fintech Editor riff on FBO (For Benefit Of) accounts, implications for banks, banking as a service and the future of fintech.

Then, Jason connects with Paul Davis, Founder, The Bank Slate about fintech partnerships, future landscape, consent orders and AI in banking.