1.
First Principles
Of Investing In Fintech

2.
Infrastructure to exchange resources
with unknown people and businesses
What Is Finance?

3.
What This Used To Mean
Infrastructure to exchange resources with unknown people

4.
What This Means Today
Infrastructure to exchange resources with unknown people
What This Means Today
Infrastructure to exchange resources with unknown people

5.
This Is A Problem Uniquely Suited For Software
Infrastructure to exchange resources with unknown people
• Scalable with 0 marginal cost
• Ubiquitous
• Everything is
a security
• Global &
secure
• Personalized
• Predictive
• Bias-free

6.
Payments
Infrastructure to exchange resources with unknown people
OLD
NEW
• Instant, 0/low fee
• Trustless systems

7.
Insurance
Infrastructure to exchange resources with unknown people
OLD
NEW
Broker Underwriter+
ML
Personalized Data

8.
Lending
Infrastructure to exchange resources with unknown people
OLD
NEW

9.
FINTECH EVOLUTION:
WHERE ARE WE?

10.
Incumbents Still Dominant In Financial Services
Incumbents Challengers
Commerce
Consumer Products
(Cameras)
Entertainment
Transportation
Financial Services Emerging
Source: KPCB

11.
PHASE 1
Acquire customers
PHASE 2
Remove friction
PHASE 3
Use data to better
allocate capital
PHASE 4
Digital-first
experiences
ILS
FinTech Evolution
O P P O R T U N I T Y

12.
There Are Trillions Of Dollars Up For Grabs
$7 TRILLION
U . S . P U B L I C F I N A N C I A L
I N S T I T U T I O N S
PAYPAL$136B
25 U.S. UNICORNS$81B
Source: KPCB, Capital IQ, Goldman Sachs, Fidelity. Public companies include financial services from the S&P 500 including banks, capital markets, consumer finance, financial services, insurance, REITs and mortgage finance. “Unicorns” include 25 private
fintech companies based in the U.S worth >$1 billion.

13.
Outlier Unicorns Have Similar Characteristics
$2.0bn
$1.1bn
As of Q1 ‘17
$1.6bn
$2.7bn
$1.7bn
$2.7bn
Source: Goldman Sachs, Pitchbook

14.
And We’re Looking For The Next One
1. Distribution advantage
2. Software as a core competitive advantage
3. Operate at the infrastructure layer or positioned to own
the full-stack customer relationship
4. Reasonable capital intensity

15.
WHAT WOULD AN
OUTLIER COMPANY
LOOK LIKE?

16.
What Would A $50bn+ Company Look Like
Theme Incumbents Greylock Portfolio
Infrastructure for financial system Visa ($371bn) Blend
Own the full-stack customer
relationship
Wells Fargo ($205bn) Ribbon
Proprietary data to make better
decisions
FICO ($9b) PayJoy
Marketplace with liquidity to buy &
sell
ICE ($48b) Coinbase
Creation of new asset class J.P. Morgan ($356b)
1
2
3
4
5

17.
Re-consolidation in The West: The Opportunity2
Traditional Banks
with Traditional Services
Startups Challenge
by Filling in The Gaps
It’s Already Happening
in The East
Source: KPCB

18.
High
Frequency
Low
Frequency
Deep Relationship
w/ Customer
Light Relationship
w/ Customer
Where Should You Start?2
O P P O R T U N I T Y

19.
Infrastructure to exchange resources
with unknown people and businesses
What Is Finance?
If you’re re-inventing any of these words with software,
I want to meet you.