Emerging Themes in Fintech with Dan Kimerling

We believe we are only just beginning to scratch the surface of the financial innovation on the horizon as a result of the fintech industry. Here to talk about emerging themes in this rapidly growing space is Dan Kimerling of Deciens Capital, a venture capital fund focused on supporting fintech companies at the seed stage.

Dan starts by sketching out his rich background in fintech leading up to Deciens before sharing some exciting early-stage fintech themes that he’s identified and is looking to invest across. From there, we talk about the last ten years of fintech, hearing Dan’s thoughts on what the monumental adoption of mobile phones and mobile wallet apps means for the financial services industry in growing economies but also globally in light of multi-jurisdictional wallets. We then shift focus to how Dan sees financial services evolving over the next decade, and he explains how we are only seeing the beginning of what is in store from an industry that constitutes approximately 20% of global GDP. We move on to discuss some examples of embedded finance, a term denoting non-financial apps that incorporate financial services into their business model. In this segment, we compare mobile wallet apps as far as their customer acquisition strategies and business models more generally, thinking about why some have succeeded and others haven’t. Toward the end of the show, we talk about how the vertical banking model embodied by fintech mobile wallet apps makes sense now for the first time in history and why this might be. For an insightful and urgent conversation about where an already massive industry is headed, be sure to tune in.

Key Points From This Episode:

• Dan’s background in fintech, why he co-founded Deciens, and who they fund.
• Exciting early-stage fintech themes; mobile wallet businesses and more.
• The last 10 years of fintech
• Dan’s perspectives as a portfolio manager on the prospects of mobile wallet adoption internationally.
• The speed of the adoption of mobile wallets in fast-growing economies
• Dan describes three factors relating to how fintech will evolve over the next decade.
• Understanding embedded finance; how non-financial institutions are embedding financial services into their products.
• How financial services businesses will switch from serving large to small audiences.
• Companies that are embedding financial services on the merchant side and consumer side; ‘two-sided networks’.
• Businesses with P2P payments networks for customer acquisition and retention.
• Three strategies Dan has seen as far as e-wallet companies’ customer acquisition.
• How the internet has contributed to the shift from horizontal to vertical banking.
• Comparing Chase to Square Cash and Venmo in terms of adoption.
• Why there is a perception shift away from banks with net interest business models to financial apps with marketplace approaches.
• Final thoughts on new mobile wallet models that Dan is interested in; multi-jurisdictional network effects.