What You Can Learn from the Top Fintech Companies in the World
What is fintech, and how can you learn from it?
The word “fintech” itself is short for “financial technologies.” According to FinTech Weekly, the term describes a business that aims at providing financial services by making use of software and modern technology. But what exactly is modern technology?
The top fintech companies are making innovations in all areas of modern technology. This includes personal financing, mobile payments, loans, and much more. The modern technologies that the biggest fintech companies are concerned with are the kinds that simply make things easier.
Unicorns in the Tech World
Unicorns: typically associated with mythology or teenage girls. In the tech world, they have a different definition.
A unicorn refers to a startup company that began at the bottom and worked their way up to being worth at least $1 billion.
Unicorns used to be extremely rare, hence the name. Big companies like Bank of America essentially had a monopoly in the financial sector.
It’s a much different story today. Unicorns are popping up more and more, with a frequency more like horses.
Get Acquainted with the Top Fintech Companies
This year, Forbes put out a comprehensive list of the “Forbes Fintech 50.” Nineteen of which are valued at $1 billion or more. Twenty of which are some of the top fintech startups.
Examples from this list include:
- Acorns. Acorns is an investing app that rounds up your spending through debit and credit cards, allowing you to save in small and painless increments.
- Betterment. Betterment is the largest independent robo-advisor.
- Coinbase. Coinbase aids in buying, selling, and managing cryptocurrency.
- Fundrise. A fintech startup, Fundrise allows you to invest your money in real estate according to your goals.
- Robinhood. Robinhood provides an easy, commission-free way to invest in stocks, ETFs, cryptocurrencies, etc.
- Stash. With Stash, you can invest with just $5 and even open a debit account.
These are only a few of the fastest growing fintech companies. Now that you know what they do, let’s dig a little deeper into what makes them stand out.
Make Your Tools Accessible
Betterment is a company proud of its ease of use. Betterment is so simple that it left users wondering, “Wait. Shouldn’t this be harder?”
It’s a challenge they’ve had to face; people actually expect to be confused. But CEO and founder John Stein says they don’t have to be.
Additionally, Betterment uses a robo-advisor. A robo-advisor is a digital financial advisor that helps manage people’s money.
Robo-advisors allow advice to be given directly to consumers at a lower cost. This makes the service more accessible to those with time or budget constraints.
Acorns prides itself on being “built for the up and coming.” With payment plans priced at only $1, $3, and $5 a month, Acorns is one of the most affordable services out there. They even took it one step further by offering their most basic plan to college students for free.
Stash has a component called Stash Learn that offers valuable information for free. More Than Finances is also a great resource; their blog posts provide material on subjects that are relevant right now, like cryptocurrency.
You also need to be sure that your business’ marketing techniques are accessible and appealing to customers. According to AgencyBoon, what consumers are looking for is how they will benefit from investing in your brand. One way to reach out to them is by telling a story they are able to identify with. You can read more here.
Fintech Companies Around the World
The Forbes list only includes the best fintech companies in America. But that doesn’t mean that unicorns aren’t popping up in other countries, as well.
China, for example, is home to some of the biggest fintech companies in the world. This is due to a couple of factors.
For one, China has a higher percentage of tech-savvy residents. This is in addition to (or perhaps because of) their higher number of millennials.
There are also plenty of opportunities to do some groundbreaking work in fintech. Startups such as M-Pesa are solving local problems in countries like Kenya by creating sustainable workarounds. And fintech’s involvement in Africa is only expected to rise.
Fintech: It’s for Everyone
Fintech has the potential to make your life easier even if you’re not part of the tech world.
If you need to expand your business but lack funds: fintech is responsible for crowdfunding. It is now possible for small business owners to access big loan amounts of money without a perfect line of credit.
In the past, small business owners have also been limited in what modes of payment they could accept. Without a card reader, the only option was cash. But fintech has brought us Square, a portable tool that can read debit and credit cards.
Another alternative? PayPal. PayPal is incredibly easy to use; anyone with an email address can set up an account.
It doesn’t even require a specific tool! To use PayPal, the only physical object you need is a smartphone. Notifications are sent immediately when you send or receive payments.
And PayPal isn’t the only one. Other payment apps have managed to succeed as well. Take Venmo, for instance. Venmo is similar to PayPal, but with a slight social aspect added in.
You are encouraged to add notes in regards to what your payment is being used for. For example, if you go out for ice cream with friends and someone else pays, you are able to pay him/her back through Venmo.
You can even add a note that says “ice cream” with an emoji of an ice cream cone, which other Venmo users are able to see.
Feel More Tech-Savvy Yet?
Financial technology is not going away anytime soon. The industry is thriving worldwide, receiving billions of dollars in investments yearly.
And the top fintech companies definitely have a lot to teach us. We just need to keep our eyes, ears, and web-browsers open.
For more resources, check out this toolkit.