By Buck Jordan, Angels & Entrepreneurs Network

Dear Reader,

We all know investing is a great way to grow your capital. Of course, that’s why we’re all here.

But as investors, we can never go it alone. We inevitably need help somewhere along the line. And there are many companies we can turn to for guidance in earning, saving and investing our hard-earned capital to generate the best returns possible.

The thing is, this fintech market is huge, with new startups building all sorts of different products to add to those already available.

That’s possible because, the truth is, there is no one size fits all. There are lots of different people in the world, each with very different financial needs and many who are underserved by the products that exist today.

This has never been more obvious than today, where people are suffering the consequences of supply change shortages and inflation.

The opportunities to serve these underserved customers are massive and there are hundreds of billions of dollars of returns to be generated in building companies in this space. This is fantastic news for us startup investors.

While it is still early days in the self-help fintech market, we have had a few notable successes so far and I want to walk through a couple examples of those today.

The Rise of Neobanks

Everyone knows that having a bank account is critical. But just because you have a bank account, doesn’t mean you have access to the financial services you need. The reality is, there is a huge population of people who are “underbanked.” Those are people with bank accounts who have to rely on alternative financial solutions because they don’t have access to everything they need from their bank.

A 2017 FDIC report estimated that 25% of US households are unbanked or underbanked. That’s roughly 75 million people – a massive market opportunity! Since 2017 these numbers have improved somewhat, but not significantly.

This sizeable market has attracted a range of new startups trying to solve the problems of legacy banks. These startups have launched neobanks (also referred to as digital banks). Basically, banks with no physical branches.

Not needing to invest in brick and mortar real estate frees these startups to invest even more in their services so they can build great user experiences and unique financial products catering to the needs of different customer segments. That’s what the industry and their customers need: more disruptive technology that satisfies real world needs… not more buildings.

One of the first breakout successes in the space was SoFi.

SoFi offers a range of financial services from auto loans to credit cards and savings accounts. Early on, it targeted college students with debt, having recognized them as an underserved segment.

Since launching in 2011 the company has grown to over 3.5 million members and hit $1 billion in adjusted revenue in 2021.

The company is public and has a $7-plus billion market capitalization today.

Not bad for a bank with no branches!


Another early breakout in this space is Chime.

Chime realized that managing your personal cashflow can be a nightmare at times and many in America pay exorbitant fees on overdraft costs and to loan sharks. Chime set out to counter these challenges by building a customer-friendly neobank with a range of financial services like SpotMe, early access to your salary and other similar services.

It’s estimated that Chime has over 12 million customers today and was last valued at a whopping $25 billion, more than 10% of the market capitalization of Wells Fargo!

SoFi and Chime are examples of the multi-billion-dollar companies that can be built on offering financial products to underserved customers.

Making Investing Easy

When it comes to growing your wealth, having access to savings and credit is not enough. The king of wealth creation is investing.

However, historically, investing in different asset classes hasn’t been the easiest to do and has involved a lot of annoying and manual work. The good news is a bunch of startups have launched in the last few years making it easier to invest (and making their startup investors richer in the process).

One great example of this trend is stock-trading app Robinhood.

The company has been so successful that it has turned retail traders and the “Robinhood Crowd” into a popular meme.

The company makes it easy for anyone to buy and sell stocks, options, and ETFs on your smartphone from the comfort of your phone. If you’ve ever used a banking application or other stock brokerages you know their mobile experiences are – let’s say – less than ideal.

Robinhood capitalized on these poor user experiences by designing and building an easy-to-use and appealing user interface. They also famously dropped stock-trading fees to zero, making trading on its app even more appealing to us retail investors.

These days, the company has over $100 billion in assets under management and 17 million monthly active users.

It completed an IPO in 2021, debuting at a $32 billion market cap. It’s had a rough ride in the last few months in the public markets, but despite that it is still a $11 billion company.

Another similar investing app that has had a lot of success is M1 Finance. The company launched to make it easier for investors to develop custom portfolios (using a tool they call Pies) and over time has expanded to offer loans, credit cards and retirement products.

The company has over $4.5 billion in assets under management and was recently valued at $1.45 billion.


Besides stock trading, as I’ve written before, crowdfunding is also experiencing huge growth and the essence of crowdfunding is about democratizing access to investing and making it easier to invest. On crowdfunding platforms like Republic, StartEngine and SeedInvest, you can invest in startups, real estate, crypto tokens and likely more asset classes over time.

Opening up access to financial services to the underbanked and making it easier for anyone to invest are huge business opportunities – especially in the startup investing space – over the next few years.

While companies like Sofi, Robinhood and M1 Finance have been huge early successes, they have just touched the tip of the opportunity in this space. Many more great companies will still be built in this space!

My fellow Angels + Entrepreneurs Network Board Member, Daymond John, actually found the next great fintech startup. He recently brought the co-founders into the studio to grill them about their business and why you should invest. Click here to watch that recording.

Until next week,

Buck Jordan.