Not Another Neobank: Why the market is overcrowded and where BBGV sees opportunity

  1. They all started when building a consumer banking platform was more of a challenge. Today the barriers to entry are lower because other companies provide the infrastructure (e.g. Plaid for integrations, Visa for cards)
  2. They launched when it was relatively easy to capture users with a lower digital marketing spend, so LTV/CAC looked a lot better
  3. All achieved product-market fit early, by capturing single 25–35 year olds making $35–75K

Women

LGBTQ+

Black & Latinx

Immigrants & Immigrant Families

At BBGV, here’s what we look for in these Fintech Allies:

  • Transparent business model: It should be clear how the company is making money — and how the business model is aligned with the consumer’s interests — in order to build consumer trust. One example is Current, which set out to target Gen Z and teens who are wholly overlooked by incumbent banks. The product is affordable at $36/year for teen accounts and $5/mo for pro accounts; and their upfront pricing strategy, compared to hiding behind a mountain of obscure fees, is rare in banking.
  • Unlock a new or untapped consumer behavior: In fintech, like with all new apps, companies are competing with the consumer’s most precious resource: their attention. To win, fintech companies need to create an experience that makes usage sticky. In short, they have to be more than just functional. While Venmo had a headstart on Cash App, the newer app had a stronger emotional pull with Cash App Fridays (Twitter-based giveaways that drive engagement and downloads) and fractional stock/crypto investing.
  • Strong distribution strategy: Digital performance marketing costs are increasing, with Instagram and Facebook CPMs (cost per thousand impressions) up 40–50% in 2020 alone. Startups will need a way to keep CAC in check while scaling, like playing to social or emotional levers. Robinhood’s free stock strategy has over-delivered, with 80%+ of new funded accounts in 2020 originating from word-of-mouth or referrals.
  • Serving the needs of the 99%: At BBGV, we focus on female founders addressing the needs of the many, whose big ideas will reshape the way we live.

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BBG Ventures is an early-stage fund backing female founders with big ideas that will reshape the way we live.

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BBG Ventures

BBG Ventures

BBG Ventures is an early-stage fund backing female founders with big ideas that will reshape the way we live.

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