3 FINTECH NEWS STORIES
#1: Tally Was a Feature
What happened?
LendingClub teamed up with Pagaya to acquire Tally’s IP:
Tally’s innovative technology simplified credit card management, helping users optimize payments, reduce interest, and improve credit health. Tally’s consumer solution allowed users to link credit cards, automate card payments, and adopt strategies to lower interest costs and avoid late fees. The company also created an embedded, white-label business-to-business credit card debt management platform leveraging the same functionality.
LendingClub uses proprietary technology and data to provide consumers with compelling solutions to reduce the cost of their debt and pay it off more quickly. This transaction will accelerate the evolution of LendingClub’s member engagement platform to drive future growth.
Pagaya’s AI-powered network of 31 lending partners and 120 institutional investors aims to be the preeminent consumer lending technology solution for the financial ecosystem. Pagaya will focus on enhancing its white-label B2B solutions, incorporating the Tally product as a value-added offering for its network of lending partners. This strategic move allows Pagaya to deliver advanced credit management solutions that lending partners can offer to their customers under their own brands.
So what?
A question investors often ask before backing early-stage startups is, “Is this a feature or a company?”
Now, of course, this question is a bit facile. Many startups that build killer products and product features grow into massively successful and diversified businesses through good luck and great execution.
Still, “feature or company?” can be a useful heuristic, and I think it’s very apt in this particular case.
Tally’s optimized credit card debt management and repayment tool was a smart solution to a big problem. However, as a business, it was always going to be challenging to make money by helping folks get out of debt. This is mainly because 1.) it requires consumers to actively make the choice that they want to get out of debt (which most don’t do), and 2.) it’s far easier to get paid (by lenders, merchants, etc.) to help consumers get into debt than get out of it.
However, optimized credit card debt management and repayment should be a ubiquitous product feature in the financial services industry. It solves a problem for consumers.
And in the case of LendingClub and Pagaya, Tally should solve a problem for them as well.
LendingClub is trying to make the transition from a one-time solution for consumers (I need to refinance my debt) to an always-on solution. Acquiring Radius Bank and launching a suite of deposit products was a step in that direction (and very useful for lowering funding costs), but the next step is to create a set of tools on the loan servicing and credit management side that keep users engaged beyond the point of origination. LendingClub already offers a tool called DebtIQ, which gives users free access to their credit reports and scores and the ability to simulate how different actions would improve their scores. According to LendingClub, Tally’s functionality will be integrated into DebtIQ, which will add a depth of capability to the tool (which is a bit thin right now) and create another natural on-ramp to LendingClub’s core product (credit card debt refinance loans).
And for Pagaya, the plan is apparently to do something similar, but with Tally’s B2B product, which will allow Pagaya’s lending partners to offer a white-labeled Tally-like experience within their own apps. This likely won’t appeal to Pagaya’s credit card partners (which I don’t think they have very many of), but it should create a nice new acquisition funnel for their personal lending partners.
#2: Mistaken Impression
What happened?
Modern co-brand card platform Imprint raised a Series C:
Imprint … announced it has raised $75 million in a Series C financing led by Keith Rabois at Khosla Ventures, with participation from existing investors including Thrive Capital, Kleiner Perkins, and Ribbit Capital. This latest financing round elevates Imprint’s valuation to $600 million, reflecting its continued momentum following several recent partnerships with leading brands.
“This financing is another vote of confidence for our business and our vision to redefine the co-brand industry,” said Daragh Murphy, co-founder and CEO at Imprint. “We are proud to partner with iconic brands, and this new capital will enable us to continue to drive real business impact for our current and future partners.”
“Imprint’s metrics easily place them in the top 0.01% of startups,” said Keith Rabois, Managing Director at Khosla Ventures. “We are thrilled to lead this round and support the next stage of growth for a transformational company like Imprint.”
So what?
I’m happy for Imprint. Series C is a challenging round to raise in this environment. And $75 million at a significantly higher valuation than the $75 million Series B that Imprint raised a year ago certainly suggests that the company is seeing significant positive traction.
All that said, I’m not sure I can buy Keith Rabois saying that “Imprint’s metrics easily place them in the top 0.01% of startups.”
I mean, obviously, it depends on what metrics we’re talking about here, but the metric that ultimately matters — profitability — is the one that I would be concerned with.
Building a modern platform to issue co-brand credit cards (and, apparently, debit cards and deposit accounts in 2025) is great, but if you aren’t a bank, there’s a limit on how much of the stack (and unit economics) you can own. Imprint isn’t a bank (they partner with First Electronic Bank), and the current regulatory climate doesn’t make me hopeful that they can become one.
Without a bank charter, Imprint structurally can’t be as profitable as the big bank players in the co-brand space (American Express, U.S. Bank, Capital One, Synchrony, etc.). And while I’m confident that Imprint’s technology is significantly better and more attractive to developers, that’s a crowded space (Stripe, Marqeta, Galileo, Lithic, Highnote, Cardless, Deserve) and it’s becoming more crowded as banks like Lead, Fifth Third, and JPMorgan Chase lean into embedded finance.
I’m not trying to take anything away from Imprint specifically (it seems like a strong company with a compelling product), but similar to the BaaS middleware space, I’m not sure how the modern co-brand credit card issuing space is venture-backable (at least in the way that later-stage VC investors usually define venture-backable).
#3: Empowering Salespeople
What happened?
Farther, a technology-focused financial advisory firm, raised a Series C:
Farther Finance Advisors LLC, a startup making technology for financial advisers, has raised $72 million in funding, betting that people want a more personal touch than they can get from roboadvisers and artificial intelligence chatbots.
The funding round values the startup at $542 million and was co-led by Alphabet Inc.’s independent growth fund, CapitalG, and Viewpoint Ventures. Other investors in the company include Bessemer Venture Partners, Khosla Ventures and Lightspeed Venture Partners.
Farther’s software helps advisers with administrative tasks and marketing support. It has offerings for financial planning, compliance assistance and operations management.
So what?
Farther acts as a technology platform that connects consumers looking for wealth management services with vetted and experienced financial advisors. The primary value add from Farther is the technology platform, which is designed to make the human advisors using it significantly more efficient, allowing them to spend more time working with their clients.
It’s basically Substack for wealth management.
Taylor Matthews, Co-founder and CEO of Farther, explained the value of this human-focused approach, telling Bloomberg that customers “missed out on the trust aspect of a financial adviser. You want somebody to confide in.”
That sounds great, but I have a slightly less touchy-feely explanation — wealth management is, at the end of the day, a sales job, and humans are exceptional salespeople.
I constantly see fintech companies trying to use technology to remove humans from the loop. The basic idea behind these pitches, whether they are in wealth management (roboadvising), auto lending (direct-to-consumer e-commerce), or accounting (a hot area now that generative AI has come on the scene), is that algorithms, apps, and automation can do a better (and cheaper) job than humans.
That is likely true for the mechanical parts of the job (picking stocks, underwriting loans, balancing the books), but it’s not true for the relationship parts of the job (including, and especially, sales).
If the profit margins in a specific industry can support human salespeople, you will find that human salespeople are stupidly difficult to dislodge, even if they are selling an inferior product.
As long as the buyer is also human (and not an autonomous AI agent), human salespeople will likely control the distribution to those buyers.
Therefore, it makes a lot of sense to me to build technology to empower those salespeople to sell more rather than try to compete with them directly.
2 FINTECH CONTENT RECOMMENDATIONS
#1: Are FBOs a No No? (by Jason Henrichs, Alloy Labs) 📚
When Jason Henrichs writes about FBO accounts and BaaS, we carve out a few minutes from our day to read (and re-read) his thoughts. It’s just a rule we have around here.
Also, please help me make “The Henrichs Rule” a thing. We can’t allow the FDIC’s proposed rule on custodial deposit accounts with transactional features to be called the “Synapse Rule.” Synapse is why we’re in this mess! Let’s treat them like Voldemort and not mention their fucking name anymore.
#2: Do Regulators Want to Kill Banking-as-a-Service? (by Rob Blackwell, Banking With Interest) 🎧
I have been loving Rob’s podcast, and now my friend Jason Mikula is appearing! Make sure to listen to this one.
1 QUESTION TO PONDER
What’s happening in Washington D.C. the week of November 18th?
I will be in town for the AFC Policy Summit on the 19th, but I would love to attend any other relevant events happening that week, as well as meet with anyone who will be there (or is based there). Let me know!
