Investment firm Route 66 Ventures says that fintech entrepreneurs seeking funding for fresh innovations in banking should focus their efforts on the development of crypto-business models, asset management, alternative lending, and bank API, mobile payments and digital channels.
In a blog posted at fintech accelerator Startupbootcamp, Route 66 partner Pascal Bouvier spells out the six areas of innovation that are likely to pique the interest of serious fintech investors.- Crypto business models that link a blockchain or a use case on a blockchain to the real world of banks, investors and the legal profession.
- Crypto business models that enable smart contracts and smart property.
- Asset management business models that enable more efficient investing, buying or selling. On the retail side this means online wealth management platforms that have figured out a way to educate mass market consumers. On the institutional side this means alternative platforms that reduce the spread between buyers and sellers of certain asset classes (fixed income, private equity).
- Insurance business models that either help carriers reach out to younger consumers or help carriers with claims management or help with certain policy classes (car insurance, home insurance, life insurance), either of which makes efficient use of big data.
- Alternative lending business models with a novel credit or underwriting engine applied to consumers or SMEs in emerging markets.
- Technology platforms that enable banks to stay relevant - API banking, transaction connectivity with and for banks’ corporate clients, mobile payments, digital channels.
Route 66 is a early and late stage investment firm focused on the financial services and fintech industry, where Bouvier is responsible for deal sourcing, deal management and investments.
Firms in the Route 66 portfolio include Startupbootcamp, D3 Banking and Moven among others.
"A few characteristics we would want to see in any of these business models would be a mobile play, an Asian starting point as a go to market strategy with global applicability at a later stage," he says. "Finally, I would personally like to see a fine balance of startups that compete with financial institutions and ones that sell and enable financial institutions to stay relevant."