3 Fintech News Stories
#1: Can IFTTT For Banking Work?
What happened?
A fintech startup raised some money:
In a financial world defined by fragmentation, fintech startup Sequence wants to become the master switch. The company, founded just a year ago, has secured an additional $7.5 million in funding to expand its platform, a kind of autopilot cockpit for personal and small business finance.
Sequence is the latest entrant in a growing field of financial orchestration tools. But its ambition is notably broad: unify every bank account, credit card, loan, savings account, investment platform, and fintech app into a single dashboard that doesn’t just show where your money is, but decides what to do with it, and when.
The platform lets users set up automated financial rules, triggering transfers on specific dates, at balance thresholds, or under custom conditions.
So what?
I’ve always loved the “IFTTT-for-money” concept. It’s basically the UX that HMBradley landed on right before it shuttered its B2C business (and it’s a big part of what HMBradley’s infrastructure spin-off is now selling to banks).
It addresses one of the core critiques that I’ve always had about personal financial management (PFM), as a category, which is that PFM tools aren’t all that useful if they just tell you what’s happening with your money; they also need to help you take action. The “if this, then that” model of automation is an intuitive framework for action-oriented money management.
Sequence also sidesteps a problem that has sunk many a PFM too in the past — an unaligned business model. Rather than give the tool away for free and make money from advertisers (which is always the thing that PFM providers are tempted to do), Sequence is doing what most modern PFM apps are doing — charging a recurring subscription fee.
My only concern is generative AI.
I’ve been critical of many of the generative AI use cases I’ve seen receive funding in fintech recently, but it does seem like a perfect fit for personal financial management, as others have noted over the last 12-18 months. A natural language interface, where users can simply ask questions, share goals, and issue instructions, without any dragging and dropping or conditional logic sounds like the ideal experience, and having an intelligent agent operating in the background, responding (flexibly) to changing market conditions, would go much further than the simple and rigid automations enabled by an rules-based approach.
I’m sure the folks at Sequence have already spent a lot of time thinking about how their product can leverage generative AI. Selfishly, I just hope it doesn’t completely replace it (at least not right away). It would be a shame if the “IFTTT-for-money” design pattern never really got a chance to gain significant traction in the market.
#2: Caught in No Man’s Land
What happened?
A B2B neobank — Slash — has pivoted into a new strategy and raised a Series B:
Many fintech startups with a similar offering—like Mercury, Brex, and Ramp—take a horizontal approach by selling to companies across different industries. [Slash co-founders] Cardenas and Bai decided to instead operate with a vertical model by creating banking services tailored for sneaker resellers, with the idea of expanding to other sectors.
For the past 18 months, Slash reworked its existing infrastructure to target other sectors: namely, performance marketing agencies, crypto firms, and HVAC operators. The pivot worked, with the startup now processing around $300 million a month on its cards.
The first sector Slash targeted … was performance marketing firms, which run ads on behalf of e-commerce companies on platforms like Facebook and Google. Slash helped solve one of their biggest pain points: Allowing these firms to create distinct accounts within their banking system for each of their end customers to give visibility into key metrics, like how much prepayment is left. Now, according to Cardenas, more than 1% of all Facebook ads are bought with a Slash-issued card.
Another vertical has been crypto-native businesses, where Slash enables companies to swap between fiat currency and crypto holdings, as well as manage all their various crypto holdings—an in-demand service, especially after many crypto firms were turned away by traditional banks under the Biden administration. With 35 employees, Slash plans to use the new funding to expand and tackle new sectors, with Cardenas eyeing e-commerce, online travel, and property managers as potential targets.
So what?
Slash has been through many pivots in its short life, but conceptually, this latest one makes a lot of sense. Products that fuse financial services together with software tailored to the exact workflows of a specific industry tend to win in B2B. It’s why Toast has been eating Square’s lunch in the restaurant industry.
My concern is execution.
Slash is currently focused on serving performance marketing agencies, crypto firms, and HVAC operators. Those verticals would undoubtedly benefit from tailored digital banking solutions, but they are all very different from each other! It doesn’t seem like there would be much overlap in the functionality needed by companies in each of those verticals. For example, here are the “modern capabilities” that Slash advertises to all of its customers on its website:
I imagine this is extremely appealing to Web3 founders, but there’s not much there that speaks to the unique challenges faced by HVAC operators.
The trouble is that Slash is caught in no man’s land. On the one side, you have horizontal B2B neobanks like Ramp, which are able to move fast and to iterate continuously on a single product set for the entire market. On the other side, you have vertical SaaS companies that focus on building the absolute best software products for their specific industries and then embedding the necessary financial services capabilities within them.
I wonder if we will see Slash either narrow its focus to a single industry (or a group of closely related industries) or move back into being more of an infrastructure provider that can partner with and enable vertical SaaS companies across a wide range of industries.
This middle path feels like a tough one to walk.
#3: Nobody Wants This
What happened?
Block is introducing the ability for merchants using its Square POS terminals to accept bitcoin payments:
The new feature – set to start rolling out later this year – leverages the Lightning Network to enable merchants to accept bitcoin payments directly through their Square hardware.
To make a payment, customers scan a QR code at checkout, with the Lightning Network protocol ensuring near-instant settlement while Square’s integration handles real-time exchange rate calculations and confirmation notifications.
The native Bitcoin For Businesses offering builds on Block’s Bitcoin Conversions feature launched in 2024, which allows qualified merchants to automatically convert a portion of their daily sales into bitcoin.
So what?
Jack Dorsey’s love affair with Bitcoin strikes again!
I continue to be baffled by Dorsey’s insistence on building enabling hardware and software around Bitcoin rather than, you know, stuff that would actually help strengthen the business that Block has today.
And yet he persists!
What’s weird is that there’s just no evidence that merchants or their customers want this.
In the Federal Reserve’s most recent Survey of Household Economics and Decisionmaking (SHED), which was fielded in October 2024, the Fed found that use of cryptocurrency has actually declined by about a third, from 12% of respondents to 8% of respondents, since 2021. On a more granular level, 7% of respondents bought crypto in 2024 to hold as an investment. Only 2% used crypto in 2024 to buy something or make a payment.
2%!
And I’m guessing that a decently large percentage of the cryptocurrency that was purchased for the purpose of making a payment wasn’t bitcoin (which tends to be volatile), but rather a different token (stablecoins seem like an increasingly popular choice for this use case).
So, why Bitcoin Jack? Why?!?
According to an interview from a few years ago:
It’s deeply principled, it’s weird as hell [and] it’s always evolving. It just reminded me of the internet as a kid.
Sure!
I suppose that if Bitcoin does eventually become the financial backbone of the internet, this could ultimately prove to be a good long-term bet. But that’s not a bet I’d feel comfortable making, given what we know right now.
2 Reading Recommendations
#1: Stablecoins (by Brian Peters, Perspectives on Risk) 📚
Given that they are the fintech topic of the moment, I thought I would focus my content recommendations this week on stablecoins.
This first one is a rigorous breakdown of a debate that has been popping up in different bank nerd circles recently — are stablecoins banks?
A fun and educational read!
#2: Stablecoins: The Practitioner’s Guide (by Rebank) 📚
This one is MUCH longer, but Kevin and the other authors do a good job of laying out the history of stablecoins, how they are used, and how they may shape the future of the financial services industry.
*Bonus: It’s Time for a Layered Approach to Credit Risk Underwriting (by me, with Prism Data) 📚
Credit scores can lie. Cash flow data doesn’t — it sees what the bureaus miss. Here’s why it matters.
*Bonus Recommendations are brought to you by Fintech Takes’ wonderful sponsors.
1 Question from The Fintech Takes Network
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What should I read, and who should I speak with to best understand the culture of various federal regulatory agencies, especially the CFPB?
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