Strategy. By combining Neobank services with automated WealthTech, Beanstox sees opportunity to accelerate growth, generate greater average revenue per client (ARPU) and build more value for clients and for the Beanstox business.
What’s a NeoBank? Neobanks are mobile-first banks with no physical branches. Typically, they operate by partnering with legacy banks, while providing attractive mobile-first banking to grow a client base. Services include checking and savings accounts, debit and credit cards, payments and more.
Beanstox Neobank? At Beanstox our team now includes senior members with extensive experience building digital banking (SoFi, CIT). We plan to add mobile-first banking services along with our automated wealth service. Clients would be able to choose one or both services offered, which we believe could accelerate growth.
Beanstox capital sources? Neobanks are attracting large VC investments, in addition to potential for further crowdfunding and for strategic corporate partners looking to provide services to an expanded client base a Neobank could bring.
How Neobanks make money:
- Interchange fees: The payment processing fee charged by Visa on debit/credit cards (~1.5%). Neobanks usually get a percentage of this fee.
- Ecosystem business model: Using APIs, Neobanks can offer a marketplace for several integrations including investments, insurance, credit brokerage, and more.
- Asset-led business model: Accumulating deposits by offering competitive rates on saving accounts.
- Product extensions: Offering additional premium services.
More info on how Neobanks make money, from surf.com.
VC Valuations of some Neobanks:
- Nubank: $2.6B raised for IPO, ~$41B valuation
- N26: $900M raised, $9B+ valuation
- Revolut: $800M raised, $33B valuation
- Chime: $750M raised, $25B valuation
- Monzo: $475M raised, $4.5B valuation
Source: Neobanks are awash in cash after a banner funding year
We are excited by the Fintech growth opportunities for Beanstox, although also mindful that for every Fintech success story, many others are less successful. Although we are planning on developing Neobank services, there are no assurances that this business segment will be developed or successful.
Get info on investing in the Beanstox business alongside Kevin O’Leary: www.startengine.com/beanstox
This content was originally published in the Updates feed of the Beanstox crowdfunding campaign on StartEngine.
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