Astra reposted this
RIP "every company will be a fintech company"? ☠️ Five years ago, Angela Strange at a16z made a prescient statement that begain mainstream for founders and investors. It was compelling – as financial infrastructure became accessible, companies across every industry would derive significant revenue from their own fintech operations. But the productization with the available infrastructure trended toward the simplest form of the statement, where every company started to look like a bank. There were definitely some winners but it turns out operating a banking product is really hard, fraught with fraud, compliance costs, and operational overhead. The thesis was right, but the first wave of outcomes missed the real opportunity. But it is still true that there are immutable components to embedded financial services that multiply value creation – lending, payments, etc. What's actually working? Companies that embed payments into their core product, without becoming payments companies themselves. Shopify doesn't want to be a bank. But Shopify Shop Pay? That drives conversion because it's delivers value to their customers, not overhead for Shopify's P&L. The real value will not be derived from every company building their own payments infrastructure, it's in removing customer friction and the cash flow tax from slow transactions. So the next prediction: not "every company will be a fintech company" but every great company will embed one and those that embed the best solutions win!