Asset news: Stellar This week (February 5) Stellar published their 2018 January Roundup (check out here what Stellar is). The roundup contained: reference to Stellar and the State of Cryptocurrency reference to 2018 Stellar Technical Roadmap recap on Financial Institutions & Partners overview of upcoming events Stellar and the State of Cryptocurrency and Stellar’s 2018 Technical Roadmap I have covered Stellar and the State of Cryptocurrency here and Stellar’s Technical Roadmap here. Recap on Financial Institutions & Partners Termio, an „advertising blockchain” will run their ICO on Stellar. Scheduled for April. LaLa World will implement Stellar for international remittance Tontine Trust is creating a social security and pension system based on Stellar MOIN and TowerChain were announced as two Stellar Anchors (an Anchor within the Stellar-network is somebody who holds and issues assets). OpenGarden announced to run their tokens on Stellar (no ICO). OpenGarden has been around since 2011 and is backed by a couple of investors (total funding around $13). OpenGarden has created FireChat, a chat app that works without an Internet connection. Furthermore — and this is their primary goal — they are working on establishing a network of decentralized ISP (Internet service providers) allowing anybody to share their Wi-Fi to other OpenGarden users.
Industry: InsurTech
Verivox, Outbank, and Clark: some disruption, FinTech-stack, and fighting incumbents
In November, the comparison portal Verivox acquired Outbank, a personal finance manager (PFM) who temporarily filed for bankruptcy and aboalarm, a contract cancellation tool (Link to Outbank’s German press release, Link to Verivox’s German press release). A lot can be written about that. For starters, why they made that acquisition. Verivox’s reasons for acquisitions: response to CHECK24, additional marketing channel, and response to FinTechs/InsurTechs Looking at CHECK24’s — their primary competitor — recent moves, probably the most obvious reason is that Verivox made the acquisitions as a response to CHECK24. Furthermore, when considering that Outbank is layered atop Verivox, I am arguing that Outbank might be an additional marketing channel (to TV and search) and thus more important to Verivox than Verivox to Outbank. Finally, through that acquisition, they might, in fact, be responding to FinTechs instead of attacking them. Verivox’s reasons for acquisitions: response to CHECK24 In May, Capital (news in German) reported that CHECK24, one of Verivox’s biggest competitors, will be offering several „FinTech products“. Among them a contract management tool, a multi-banking feature and an expansion of their comparisons into fixed-term deposits. Whereas this was often quoted as an attack on FinTechs (amongst others Clark, WeltSparen, and Outbank),
kwitt, Lendstar, and Cringle: timing, feature vs. product, and activities-based banking
Venmo, MobilePay, Cookies, kwitt, N26’s MoneyBeam, PayPal, Wavy, Lendstar…and now Cringle. All of these services, apps, and companies have in common that they are used for P2P payments. Some of them failed, some of them are very successful, some will be and some won’t. Cringle, the Berlin-based startup, believes that it can be successful and has thus started their second crowdfunding campaign on Companisto (link to campaign). Besides P2P payments, Cringle also wants to offer a B2B payment solution allowing retailers and online shops to accept payments through Cringle. I won’t go into their B2B offering, but it merits to say that the German online payment market is dominated by PayPal, bills, debit and credit cards, and that the mobile payment space is yet to be dominated. Here I will look on their P2P payment solution. P2P payments not compatible with how money is handled in Germany and niche approach to circumvent incompatibility From a fundamental point of view Cringle’s success depends on process innovation. Process innovation can be defined along the following lines: „Process innovation means the implementation of a new or significantly improved production or delivery method (including significant changes in techniques, equipment and/or software)“ [8]. And Cringle is
ING-DiBa, N26, revolut: fairly good incumbents and FinTech re-unbundling
According to Gründerszene, the Berlin-based solarisBank might raise a Series B. Whether this will indeed happen does not matter (the news is actually from October). What matters, however, is solarisBank’s position in the FinTech value chain. solarisBank is a banking platform which owns a banking license and offers financial services such as bank account management, credit card issuing or KYC (know your customer) services. In short, the bottom of the stack, the infrastructure of FinTech companies — as some would say — the boring stuff. In contrast, N26 and revolut are doing the exciting, customer-facing stuff; offering an easy to use, nice looking banking app. From a strategic perspective, however, the „boring“ stuff, is actually the sexy stuff (if banking can be sexy at all). This is not only because solarisBank per se is attractive (in many cases they are the backbone of FinTechs), but also because N26 and revolut are playing in an extremely difficult market. Slow customer acquisition and market saturation Whereas there are several difficult things about banking, the one I am referring to is customer acquisition. For instance, Scalable Capital, a robo advisor partnering with ING-DiBa, shows how difficult customer acquisition can be and, in turn,
€300 Million for paydirekt, €500.000 for happybrush
paydirekt might get €300 Million from its founders. It is estimated that paydirekt has already received €100 Million. At the same time, paydirekt’s CEO, Niklas Bartelt, should be replaced (from Süddeutsche). paydirekt was founded by a couple of German banks in 2015 and offers C2C and online B2C payments. Martin Zielke, board chairman of Commerzbank, argued back in 2015 that paydirekt was not founded with the idea of replacing the competition, but rather co-existing with them as — so Zielke — the online payment space has room for more than one company (from Süddeutsche). I agree with Zielke, but it is also a very undifferentiated market where people won’t switch unless given a very good reason. The most significant reason in C2B is network size, i. e. how many shops support the system. This significance of network size implies the vital role of pull marketing; there is little use in convincing people to sign-up for a new service now, so that they can use it later. Instead, people will access an online shop, realize that there is a payment solution they do not have – but need – and thus sign-up for that very service. paydirekt’s push marketing questionable This
simplesurance, getsafe, Coya, and ONE – convergence, emotions, and power of customer base in FinTech
The German mobile bank N26 announced that they are expanding into the USA. This announcement comes almost exactly one month after revolut, their biggest competitor, launched its operations in Austria and Germany (I wrote about revolut in revolut, N26, and the future of banking). Also, this announcement comes only a few days after revolut’s announcement of the cooperation with the InsurTech startup simplesurance. simplesurance — a test case for simplesurance and the industry This partnership is interesting due to several reasons. Specifically, in regards to simplesurance, it is interesting because their simplesurance’s solution for revolut does not stem from their standard offering. simplesurance, the Berlin-based FinTech, has three offerings: B2C products such as simplesurance.co.uk through which they offer insurance for consumer electronics, insurance cross-selling for e-commerce, and an insurance broker. I guess that this is a test case for them and — if successful — going to integrate that as a standard offering. As it is concept-wise similar to their cross-selling solution, it makes sense to incorporate that into their offering from a portfolio perspective. From an industry-perspective — and this is another interesting aspect of this cooperation — it makes sense as well because it points at the convergence of
byte heroes, HydroMiner, and Wysker — first ICOs in Austria and Germany
In the last couple of days four ICOs have been announced in the DACH-area: HEROCoin by byte heroes (Austria’s first ICO) H2O by HydroMiner wys by Wysker (Germany’s first ICO) CTD by Cointed Here I will cover HEROCoin, H2O, and wys. As Cointed was accused of fraud, it deserves a more detailed look and I will do so separately. ICOs in general, are a fascinating topic and I am equally excited that we have them now in Austria and Germany as well. In this post, I am going to focus on the white papers and only briefly touch upon the startups itself. Due to lacking regulations, there are no binding guidelines regarding what such a white paper should contain or a company-specific coin should be. However, what struck me was How little information about the current state the white papers provide: finances, competition, and market overview, for instance, are sparsely elaborated How little information about the future they present: wysker is the only company to provide measurable metrics for assessing progress (and these metrics are not the most useful ones) The lack of an economic model for the coins: I believe that the issued coin should be tied to the