Good morning, and welcome to Protocol Fintech. This Monday: the challenge for proptech, Intel’s mining play and the wisdom of Razzlekhan.
The challenge for proptech
Real estate is a huge business: Housing alone accounts for roughly one-sixth of the U.S. economy. Historically, if anything, it’s been light on tech, with outdated processes, thickets of local regulation and a crush of paperwork. That’s why Protocol Fintech is publishing our latest manual, “Proptech’s big moment,” today.
A flood of investment into proptech is changing the field. As of the third quarter, investors had put nearly $13 billion into tech startups involved in home buying, construction, insurance and related industries.
- The most visible players in the sector are the iBuyers. Algorithmic home flippers are a fast-growing presence in residential real estate, so Tomio Geron dug into the troubles of Zillow and examined why Offerpad and Opendoor have thrived.
- The pandemic has a lot to do with both, it turns out. Zillow was caught by a fast-turning market while its rivals were better able to factor rising demand for housing into their plans.
- Ultimately algorithms won’t be enough. The real wins will come from layering on other services home sellers and buyers need.
- That’s a lesson that Rocket’s Jay Farner learned long ago, he shared in an interview with Ben Pimentel. The top home lender is anticipating a changing interest-rate environment and expanding into other businesses.
Proptech is about more than just selling homes. Construction, title, insurance and even services for the aging are part of the opportunity.
- Housing finance is up for a revamp. Among the proptech trends highlighted by the experts Tomio consulted are new ways to monetize home equity and give individual investors exposure to real estate.
- Ben identified 10 up-and-comers in proptech you ought to be following. Their ventures range from making construction more efficient to providing concierge services to apartment buildings.
There’s a challenge that proptech will struggle to solve, though. If we don’t get housing supply into better balance with demand, the sector will suffer alongside the rest of the economy. Tech can help here, by making the construction, finance and maintenance of housing more efficient and hence less costly. But ultimately it will take political will to remove the biggest impediments to housing production, which are restrictive zoning and other unwise local regulations.
A MESSAGE FROM NOVOPAYMENT
As the race to financial innovation accelerates, Banking-as-a-Service is carving out an essential role within it. Not a bank but not a standard fintech, Banking-as-a-Service falls between the two, utilizing strengths of each to create something new. Read Demystifying Banking-as-a-Service to gain insight on how BaaS connects the digital economy.
On the money
On Protocol: Intel is planning to develop new “energy-efficient” semiconductors for crypto mining. The chip giant has already signed major customers like Jack Dorsey’s Block, which is also interested in reducing the environmental impact of mining.
Trading app Moomoo is partnering with two Bay Area organizations to launch #Investeen. The #Investeen campaign will aim to help teens improve financial literacy and equity investment knowledge with a number of educational programs, virtual classes and an “investment competition.”
China has put an end to Visa’s payments near-monopoly at the Olympics. This year’s Beijing Olympics had three payment options instead of two — the new arrival alongside Visa and cash was the e-CNY, or China’s digital yuan. The e-CNY is reportedly getting more usage than Visa, which may have been hindered by international payments surcharges.
OpenSea is launching an investment arm and a community grants project. The funds will support Web3 startups and projects as well as community initiatives.
The NFL spent $600,000 lobbying Congress and federal agencies on blockchain-related issues. According to disclosure reports, the lobbying happened from June to December last year, and extended beyond Congress and the SEC to include the White House, the DOJ and the Department of Commerce.
Overheard
Uber has plans to accept cryptocurrencies as payments, but only if their climate impact gets addressed. "As the exchange mechanism becomes less expensive, becomes more environmentally friendly, I think you will see us lean into crypto a little bit more," CEO Dara Khosrowshahi said in an interview.
Looks like Affirm’s earnings call wasn’t entertaining enough for its founder and CEO, Max Levchin. “Yes, there is the potential. I was just starting to fall asleep because you guys are asking Michael excellent questions, and he's doing a great job answering them,” he said when asked about working with companies like Plaid and Finicity.
Ryan Breslow, founder and former CEO of Bolt, dances every day and sometimes in between meetings, and apparently it’s working for him. “I’ve learned more about leadership from the elders in dance than in a lot of tech circles,” he said in an interview.
Heather “Razzlekhan” Morgan, the more musically inclined half of the couple charged with laundering $4.5 billion in bitcoin, has not stopped making headlines this week. She publicly denounced crypto trading, even while authorities alleged she was using stolen crypto to buy a PlayStation with her husband. “Damn, the amount of spam I’m getting about sketchy crypto get rich stuff really makes me feel like this bubble is gonna pop soon!” she tweeted last year.
Coming up
Bottomline’s earnings call is slated for Tuesday. EPAY’s average estimated EPS is at $0, which would be better than last quarter when it surprised Wall Street with a loss.
Shopify and Global-E’s earnings calls are scheduled for Wednesday. SHOP’s average estimated EPS is at $0.53, up 279% from last quarter. GBLE’s average estimated EPS is at $0.02, up 100% from last quarter.
The MGS Fintech Conference is happening Thursday. The conference will take place in San Francisco, featuring over 10 speakers from a range of fintech companies. Previous speakers include execs from Plaid and Credit Karma.
The Cloud and Data Transformation in Banking Summit also starts Thursday. The two-day conference will feature over 25 speakers from the banking industry, with discussions around why and how banks are transforming their data.A MESSAGE FROM NOVOPAYMENT
As the race to financial innovation accelerates, Banking-as-a-Service is carving out an essential role within it. Not a bank but not a standard fintech, Banking-as-a-Service falls between the two, utilizing strengths of each to create something new. Read Demystifying Banking-as-a-Service to gain insight on how BaaS connects the digital economy.
Thanks for reading — see you Tuesday!