LAS VEGAS–More than 200 people packed a room here for VentureTech 21, a showcase for fintechs seeking funding from and/or partnerships with credit unions and CUSOs.
VentureTech 21 was created Nick Evens while he was with Veridian Credit Union in Iowa, along with CUNA Strategic Services and Open Technology Solutions. Evens, who emceed the Las Vegas event, now leads Curql Collective, the CUSO/venture capital initiative that recently announced it had closed its first fund with more than $250 million.
The event attracted 48 credit unions, three corporates, 21 CUSOs, 17 leagues and league service corporations, and five venture capital firms.
Fourteen fintechs made their pitches over two days, in addition to nine companies that are part of the Curql Fund portfolio, including Payrailz, Zest AI, Clutch, Eltropy, Illuma Labs, MotoRefi, Nymbus, Posh and Defense Storm.
Below is a brief overview of the eight companies that made presentations on day one. Companies that made pitches during day two, for which CUToday.info was not present, included Akuvo, V-Talk, Renofi, Long Game, Tax Status, and Silvur.
Ciphertext Solutions
Ciphertext Solutions pitched its solution, Issue Direct, for digital issuance of cards, saying the time is right as people are moving from the physical to the digital and there is demand for speed and convenience. The company is in various stages of rollout with several credit unions, including USAlliance, Kinecta and Farmers Insurance FCU, and is seeking additional partners.
Cyphertext was voted as the day one presentation winner.
Equipifi
Equipifi is offering a buy now, pay later solution (BNPL) for credit unions. As CUToday.info has reported, BNPL volume is soaring, and Equipifi shared a graphic indicating it is projected there will be $680 billion in spending in BNPL solutions by 2024. It further noted many retailers are eliminating layaway programs
“There is a massive opportunity. Your members are likely already using it,” company reps said.
The company said its solution converts qualified purchases into BNPL plans.
Finalytics.AI
Finalytics.AI said it is offering the first AI platform designed to leverage big data for credit unions.
“Chime is growing faster than many big banks and it has no branches and no bank license,” a company representative said. “They are really good at acquiring customers at scale using big data. It offers a personalized digital experience. Credit unions can do this, too, but you don’t. Ninety-five percent of credit unions deliver the same experience. The grandmother gets the same message as the granddaughter.
“The promise this Silicon Valley marketing company has made to consumers is a lofty goal, and it’s taking the position credit unions used to own,” the representative continued. “Why don’t CUs personalize the digital experience. It’s really hard and it’s really expensive. It’s not digital transformation--it’s transformation.”
LinkMoney from FinGoal
FinGoal’s solution seeks to provide a 360-degree view of member finances.
“This is the fastest, safest and most cost-effective way to make off-link data available to create a modern banking experiences,” a spokesperson said, adding the solution is different from offerings from companies such as MX and Yodlee, which the company rep said are expensive and there is a data silo problem. “We are able to link multiple accounts, giving the CU access to all of the member’s finances.”
Array
Noting members no longer walk into branches with financial questions, they pose them online where CU competitors often get first crack at answering, Array works with all three credit bureaus and draws on other data to provide answers within the credit union’s own digital platform, where it makes product recommendations, provides omnichannel marketing opportunities.
The company, which has backing from CUNA Mutual’s CMFG Ventures, is currently working with about 125 CUs, according to a representative.
Interface AI
Interface AI demonstrated a solution called Intelligent Self Service that is aimed at automating responses to inquiries to the call center.
The company’s CEO said it is a solution that allows a credit union to transform its call center “from a cost center to a revenue center.”
The company noted that during the pandemic call centers have seen a 30%-40% increase on average in call center volume, with call wait times also getting longer.
“Credit unions cannot solve this problem by hiring more staff, nor can they outsource more,” a company rep said. “Outsourced call centers are not taking more clients.”
The company said its AI-powered phone banking solution can respond to most calls without human intervention. If the software senses any kind of dissatisfaction from the caller’s end, it immediately transfers the call to a live person. The solution can handle 119 languages.
Atomic
Atomic demonstrated a solution it said offers a trusted way for customers/members to connect to their payroll accounts to an app.
“It’s not a nut that has been cracked,” a company rep said. “The low-hanging fruit is the ability to move the direct deposit. It addresses the challenge that retail members don’t control access to their payroll or changing how money flows from their paycheck. The solution gives members the ability to change paycheck distributions or access their payroll data via a consumer-enabled API. It takes about 90 seconds.”
The company said the solution can lead to a 20%-40% lift on direct deposit. It said it has done 150 plus unique payroll integrations
SocialEquity
SocialEquity said VentureTech 21 was the official unveiling of a solution aimed at turning renters into homeowners by offering fractional ownership of homes. The company said its philosophy and motivation align with that of credit unions and that it seeks to do well by doing good.
While the company did not win the vote as the most popular product presented to the audience, it did provoke the most questions.
“We are focused on one of the largest crises in our country, which is the affordability gap,” said a company spokesperson, explaining Social Equity has been working on the solution for 18 months.
In short, the solution seeks to allow multiple people to purchase a home and share ownership. Purchasing a home as a twenty-something rather than a forty-something can make a $250,000 financial difference during a person’s lifetime, the company said.
But too many people are “trapped in rent,” it added.
“We are fighting a virtual war in the market,” the company rep said. “We want to do something real about it. What we need is allies. We need credit union allies.”
The company said it has been in discussions with at least one credit union, and that its solution can bring revenues and loans to CUs.
“This brings credit unions new sources of revenue with new, younger members, larger home loans and built in protective risk mitigation that lowers overall lending risks,” he said. “We are going to make metric tons of revenue. We believe in doing well by doing good.
Like a Dating App
“The solution is similar to that of dating apps in that is seeks to match up people on “like-mindedness” and other factors based on profiles users create as they answer questions about how they live, with whom they would like to live, their current living habits and more.
In response to audience questions related to who might buy the loans, SocialEquity said the CUs it has talked to have suggested they would portfolio the loans and then perhaps participate them to other CUs.
The company said the home loan structure is consistent with the law, and that the property is conveyed into a trust.
Each person is responsible for their own payment so if one misses payments, it does not ding the others’ credit.
No launch date was announced.