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I want to build Growth Street 3.0 - Coggle Diagram
I want to build Growth Street 3.0
Secure buy in
SLT
Can we dedicate resources to diligence preferred option? - Capacity
Will we consider > building a loan book? - Willingness
Do we have preferred alternative options? - Readiness
Investors
CvL
Believable and realistic
Mediator
FinTech Unicorns >= 2016 (34)
Grasshopper Bank
Pie Insurance
Hastee
Brex
Why do their target customers want a credit card?
Large item purchase on credit w/out credit checks
Prestige of credit card?
Rewards
More widely accepted than prepaid cards?
Divvy
What does Divvy have that Pleo and Spendesk do not?
Simply Asset Finance
Qonto
OmniBnk
Chetwood Financial
What do these guys actually do???
Lending model
Origination
P&L - Turnover
Best in class - Brand
Zero CAC
Cross sell products
GS - Unproved
Funding
P&L - Interest expense
Best in class - FSCS retail deposits
GS - 8.5%
Servicing
P&L - Operating expense
Best in class - Full automation 3-1-0 model
GS - Automated credit policy only
Risk management
P&L - Risk provisions
Best in class
In house EL model
Proactive EL model
Pre-manage PD
Pre-manage LGD
Real time EL model
GS: External and reactive EL model
Financial model
Levers
Inc lifetime value
Diversify revenue streams
Interchange fees
Inc operating leverage
Increase Facility Size >500k
Lower cost of funding
Retail deposits
Improve risk provisioning
Build better risk model
External models
What can we learn from Funding Circle business model?
What can we learn from the big 5 business model?
Credit cards
Capital on Tap
Simon Coles
Required PGs but never enforced
Eventually sold off bad debts to collections
40% customers pay monthly balance in full
Focused on sole traders
Began as a monthly overdraft, branched into cc
Avios points big lead gen tool
Disclaimer on business rewards for personal use
High fraud due to card interception in mail