Weekly Briefing No. 171 | 5 Fintechs to Watch, the Rideshare Arms Race, and More

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Welcome to The FR. All of our influencers are organic.

In this edition:

  • 5 to Watch at This Year’s FinTech Innovation Lab New York

  • The Rideshare Arms Race

  • Credit Cards Look to Social Media Influencers

  • B2B Tech Is Hot

  • Healthtech Benefits from Big Tech Scandals

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5 Companies to Watch at This Year's FinTech Innovation Lab New York

This month marks the start of the ninth year for FinTech Innovation Lab New York. The 12-week non-profit program is designed to put the focus on the country’s most ambitious, budding fintech companies.

The event is also somewhat of a matchmaking exercise, as growth-stage companies meet with VCs and financial services execs for in-depth business and product development consultations.

So, is the next hot fintech unicorn present at this event? Only time will tell, but some of the notable tech standouts this year are firms operating in the AI, machine learning, and gamficiation spaces.

The Rideshare Arms Race

While the narrative that millennials and Gen Z will bring about the end of personal car ownership is a bit overwrought (and perhaps not entirely accurate), these are still heady days for companies that want to provide rides for people. Uber’s upcoming IPO is perhaps the most anticipated in years, even if its valuation may seem a bit high to some.

Meanwhile, Wall Street analysts are bullish on Lyft’s long-term prospects in the first round of reports written since its IPO on March 29. And if you like being driven around but hate the human interaction of dealing with a driver, Elon Musk has some delightful news for you. In an apparent shot across the bow to established rideshare services (not to mention regular old traditional taxis), Musk said this week that Tesla will have more than one million autonomous robotaxis on the road next year.

Who will be the clear winner, or winners, from all of this ten years from now? No one knows; but it’s clear the battle for rideshare mindshare is only just beginning.

Credit Cards’ Latest Marketing Strategies

Besides car ownership, another thing we are always told millennials hate are credit cards. Perhaps with that in mind, credit card companies are ramping up their advertising on social media sites in an attempt to better reach a younger demographic. In addition to regular digital ads, some companies that issue credit cards are also paying social media influencers to hock their wares. One example from The Wall Street Journal: “When we were in Austin, I used my @wellsfargo Propel Card for EVERYTHING! Restaurants, gas stations, hotels and more restaurants… All those categories earn 3X points! It was so easy to earn points just by living life the way that we do! #LifeWithPropel #ad.”

We love how the enthusiasm and exclamation points are juxtaposed with “#ad” at the end. Who knows whether these types of influencer shout-outs are successfully getting more people to open credit card accounts, but for now it seems to be a big part of the marketing push.

B2B Tech Is Hot

Wall Street is starting to realize what we have said all along: that while “hot” consumer-focused technology gets all the buzz, enterprise tech that serves businesses is where it’s at. That’s the software that truly powers the world and is indispensable to the modern globalized economy.

According to an analysis from The Wall Street Journal, since 2016, the business-software companies that have gone public have performed much better than their consumer-centric counterparts. Shares of their stock have risen a median 126% from their debuts through Tuesday’s market close, according to the Journal. That compares with a median 15% increase for the consumer-tech companies.

The reasons for this are many, but a primary one that we subscribe to is that the entrenched old guard is easier to disrupt than ever before. Technologies such as cloud computing have made it much easier to deliver enterprise “software as a service” more efficiently (and cheaply.) Keep that in mind when the media goes crazy over the next big tech IPO.

Healthtech Benefits from Big Tech Scandals

The last couple of years have seen once-beloved big tech companies like Facebook and Google face negative press and a few black eyes due to various scandals involving data security, sexual harassment, and other issues. One of the beneficiaries of this fallout is the healthtech sector, which is now finding it easier to recruit talent away from these companies, where before they struggled. Socially minded software developers, engineers, and others are now increasingly looking to work for firms they deem as doing good for society. This is not surprising, especially considering the younger demographic is one that tends to look at corporate social responsibility when making purchasing and employment decisions.

Quote of the Week

“Influence is the new power — if you have influence, you can create a brand.”

— Michelle Phan