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I recorded this episode at FinTech Nerdcon in Miami with Steve McLaughlin, Founder and CEO of FT Partners, the largest fintech-focused investment bank. Since 2001, Steve has built a 250-person firm that’s advised on landmark deals including Coinbase’s $4.3 billion Deribit acquisition and Revolut’s multi-billion dollar raises. FT Partners works with everyone from early-stage startups to industry giants.
What makes Steve’s perspective invaluable is his position at the absolute center of fintech dealmaking. According to Steve, FT Partners is signing more engagement letters than ever, closing more deals than ever, and expects 2026 to be a blowout year.
In this conversation, Steve shares his unfiltered views on Fintech’s dramatic recovery, the tokenization revolution, and why AI will completely reshape financial services.
Why building through pain creates unbreakable moats
Steve has been around the block. He’s been advising fintech clients for almost three decades and he describes 2023 as the darkest period in fintech’s 30 year history. Darker than the dot-com crash or the 2008 financial crisis. The 2021 boom had been so overheated that the subsequent correction brought deal activity to near standstill. But the transformation by late 2025 is remarkable: crypto is back (with regulatory support), FT Partners is signing more engagement letters than ever, and 2026 could be a blowout year.
According to Steve, what makes this recovery different is the quality of companies being built. The companies Steve meets these days are crushing it with lean tech teams, clear product-market fit, and disciplined execution. These founders learned from the mistakes of 2020 and 2021: they’re not spending to oblivion, not marketing for marketing’s sake, and using AI to build products with a quarter of the previous capital requirements. Even InsurTech, which became a dirty word, is back. The business models are fundamentally sound.
The darker reality is what Steve calls the “zombie zone.” Solid companies that couldn’t reach escape velocity, cut costs, and ended up flat or growing just 5%. These face brutal conditions: struggling to raise equity, stuck with expensive debt, and the market of potential buyers doesn’t want flat companies with upside-down unit economics. Steve predicts this reality will lead to significant M&A at depressed prices and mark to market writedowns across portfolios. But for high quality companies at every stage, it’s a genuine heyday.
The tokenization revolution that will reshape every asset class
“My prediction is, in 20 years, every single asset class is fully tokenized. I don’t think 100%, I think every asset class would go from 0% to maybe 80% tokenized.”
Steve admits he was initially skeptical about crypto. He invested in funds like Ribbit that did well in the space, but personally held back. Now he believes the entire world has broken wide open for crypto and it will dramatically change financial services. His favorite sector right now is blockchain and crypto, and he acknowledges it doesn’t take a genius to recognize this.
The critical insight is that Bitcoin was merely the test case proving blockchain technically works. It worked incredibly well, leading to private chains and new instruments. Steve believes we’re still in the first inning. What excites him most is real world asset tokenization: companies like Digital Asset Holdings exploding with volume, Braille enabling others to create stablecoins, Securitize partnering with BlackRock, and Mesh Payments (shout out to past guest Bam Azizi!) digitizing the entire payment space for tokenization.
Steve’s prediction: in 20 years, every asset class will be 80% tokenized, with 20% remaining old school to price assets and provide reference points. This transition will be slow but steady, asset class by asset class. Traditional incumbents like Goldman Sachs and JP Morgan won’t be wiped out. They’re already evolving, trading digital assets, and launching tokens. It will be a meshing of old and new worlds, similar to how NYSE bought Archipelago and went fully electronic. Some old school players will disappear, but many will adapt. Tether, unknown in 2020, now talks about half a trillion valuations. The revolution is just beginning.
How AI will completely destroy and rebuild financial services
“Financial services is the perfect sector to get massively, massively destroyed by AI. And what I mean by that is the big, big, big insurance companies are going to have to adopt AI tools, and thousands and thousands of people are going to lose their jobs.”
Steve has said throughout his time in fintech that financial services is an incredible sector for technology. Other than credit cards, Verifone terminals, and ATM machines (all going away), it’s 100% a business of zero physical products. When everything is digital (numbers, paper, information, risk, controls, compliance) you have massive manual labor, rework, errors, and fraud. It’s the perfect sector for AI transformation.
Big insurers and financial companies will be forced to adopt AI tools, and thousands will probably lose jobs. Just recently, Steve talked to a mortgage company working with Palantir. Over several years, Palantir projects they will essentially decimate their cost structure. There’s almost no part of the mortgage process that needs humans: not applications, ID checking, paperwork collection, or verification. It can all be done in a borderline errorless way. The same applies to underwriting insurance with available data. Companies like Snapsheet are using AI to adjudicate and process claims.
Speaking of AI, Steve talked extensively about FT Partners just leading a $75 million investment in Model ML with a $25 million check, creating what Steve calls “the OpenAI of investment banking.” The platform examines entire data rooms with thousands of files and creates first drafts of investment committee memos, pitch decks, valuations, comps, and identifies potential buyers. Multiple AI agents work in parallel: one reviews audits, another examines models, another analyzes decks, then agents compare everything, build presentations, edit them, and ask questions. According to Steve, they’re building this for clients, not internal efficiency. It’s about getting better answers. He predicts that in six months, every buyer should hire companies like Model ML to rip through 100% of diligence information before deals close.
Why Bilt is the misunderstood payments giant building unbreakable network effects
Another company that is close to FT Partners is Bilt. FT Partners has helped them raise hundreds of millions at a $10 billion valuation and Steve is a huge fan. Bilt is a juggernaut. Steve also agrees with me that Bilt is misunderstood by people who don’t spend time with them. Those who view it as just a credit card or plain payments company miss the highly network effected closed ecosystem.
Renters face numerous issues: finding apartments, paying rent without cashback, inability to use credit cards. Ankur realized going renter by renter in B2C would be a race to zero. Instead, he went top down, signing every major property owner in the country (eventually the world) to become their payment provider. Everyone in every unit of every building must pay using the Bilt payment network. Once you have that, you have an app in every renter’s pocket across the country, enabling you to serve up rewards cards and other products. This creates a massive closed ecosystem nearly impossible for others to replicate
Why Steve loves building FT Partners more than closing billion dollar deals
“What we do never, ever, ever goes out of style: doing super deep work, being super earnest, supporting founders, supporting VCs, supporting companies, and getting them that much needed capital or M&A.”
When I asked Steve what excites him most about fintech, he doesn’t talk about sectors or geographies or deal sizes. He talks about building his own company. FT Partners has grown to 250 people, and the real joy for Steve is watching them grow. He’s seen associates who were trying to figure out analytics become “40 year old complete ballers” and executing at the highest level. Steve thinks about his team constantly and how thankful he is for everyone, being there for great moments and tough moments. FT Partners truly is his pride and joy.
The Unfiltered Q&A: Steve McLaughlin on Building FT Partners and the Future of FinTech
Miguel Armaza: Steve, you consider yourself kind of the central node in FinTech. Tell us about the state of the market today, because it’s certainly more active than our last recording in late 23.
Steve McLaughlin: Oh my God, late 23. The best of times, the worst of times. Late 23 is probably the darkest part of the FinTech journey, even in the last 25 or 30 years, in my opinion. I lived through the whole dot-com up and down, lived through 2002 and even the financial crisis. Things were going well in FinTech. So really, to me, it was just so good leading up to 21 that in 22 you had a lot of things happen that were result of 21 activity. But 23 was that year where nothing really was getting done. I mean, we did get a bunch of deals done, but in a broad way, it was pretty slow.
Right now, we’re at the tail end of 25. Trump’s been in office for a year. He’s been great for crypto. FinTech, I think, is probably as good as it’s ever been. I don’t think that valuations are where they were in 21. They’re not. But I would say the number of high quality companies at all levels is significant. We’re meeting companies with 1, 2, 3, 4, 5 million of revenue that are just crushing it, that really seem to have their tech stack down, they seem to have their product market fit, they know what they’re doing.
What I’ve been saying is that right now, you’re seeing companies that took note of what went wrong leading up to 20 and 21 and they’re not doing those things. They’re not spending to oblivion. They’re not trying to market for marketing’s sake, for growth sake. They’re using AI so they’re building product with a quarter of the capital that it took before. So I just think there’s a lot less mistakes being made. There’s a lot more people taking advantage of the technologies that are out there today. And I think the business models are where they need to be.
Early stage, we’re looking really good. I think mid stage companies (10, 15, 20 million in revenue, up to 100) tons of those great companies in all spaces. InsurTech is even back and InsurTech was a dirty word for a while. Crypto is doing great. Capital markets tech is going great. Companies like Capitolus, for example, these guys are crushing it. Then you look at companies like Tether. In 2020, whoever heard of Tether? They’re now talking about a half a trillion dollar valuation, growing like a weed. And that’s at the mega company level. You look at the Revoluts and things like that, who we raise a lot of money for.
I think right now is a heyday. What’s tough right now is if, for whatever reason, you weren’t able to get escape velocity, you had to cut costs and you’re flat, or you had to cut costs and you’re going 5%, or you had to cut costs. I think M&A is tough. People don’t want to buy flat companies. People don’t want to buy decreasing revenue companies. People don’t want to buy companies that have upside down unit economics. So I think there’s a bit of a dead zone, or a zombie zone, of pretty good companies out there that just weren’t able to really scale up. It’s hard to get capital from equity. It’s hard to get debt capital. So I think you’re going to see a lot of M&A at depressed prices, and I think you’ll start to see a lot of mark to markets coming down on a lot of assets.
But by and large, it’s probably one of the more positive moments in time. We’re bursting at the seams. We’re signing up more engagement letters than we ever have, closing more deals than we ever have. That’s mostly the back half of 25, or maybe the middle half so far, and then the back quarters. But I think 26 will be a blowout year for us. That’s across the globe, across sectors. So I think the state of FinTech is really good right now.
Miguel Armaza: I’ve seen FT Partners announce some incredibly large deals, both on the financing side. new rounds for companies. or also IPOs or even M&A. What have you learned about the most recent deals? How are they different from, let’s say, three, four or five years ago?
Steve McLaughlin: Yeah, I would say on strategic, it gets back to what I was saying. there’s many types of deals. Let me name an actual deal. We just sold a company called Forge, a public company, for $670 million to Schwab. They were losing $62 million a year gap earnings. And Schwab, amazing company, big brand, they ultimately realized that the private market. Forge is a private markets marketplace, basically. and Schwab is saying, “Hey, we’ve got $30 billion or zillions of dollars of assets looking for privates. We want to get something in this space.” So they looked through the earnings, through the valuation, and paid the strategic price for a company that was in demand by other companies, but they won the deal. So it was a really strategic price. They weren’t looking at 20 times EBITDA or x times gross profit. They just said, “Look, we can do a lot with this.” So there was a really strategic deal.
We sold another company called AvidXchange, which has been a client since 2009. met them when they were worth $20 million. to TPG and Core Pay for two and a half billion dollars. That one was TPG and Core Pay coming together, a combination of an LBO player and a strategic. Core Pay bought a third of it, TPG bought two thirds of it. There’s a deal where a company had gone public, had reached escape velocity, was very profitable, and they paid a big multiple for that.
So you’re seeing a lot of different types of deals get done. There’s rumors of the BBNKs of the world, of the ZeroHash of the world, which are great companies, getting bought for multiple billions of dollars on probably sub-$100 million of revenue. So in the crypto space, you’re seeing people really pay up for assets. We sold Deribit for $4.3 billion. largest ever, believe it or not, for all the crypto stuff that’s happened for 10 plus years. The largest deal in the history of the world has been the Deribit sale for $4.3 billion to Coinbase. We also sold Hidden Road to Ripple for $1.25 billion, the second largest M&A deal in crypto.
So you’re starting to see some of the big strategics come out of their shoes to get more big and more institutional, diversify their product set. Coinbase, which people think of as a US company, bought Deribit. it’s really international, could be not doing business in the US, in a whole different product set than Coinbase. Now you’re seeing Robinhood buy things. We just sold them a company called WonderFi, so they’re now getting big into crypto. And I think you’re going to see a lot more in the crypto space, a lot more TradFi coming over to DeFi and DeFi going to TradFi. Look at Ripple buying G-Treasury. Just incredible amount of activity right now.
My favorite sector. I don’t have favorites, but for the moment. is blockchain, crypto. It doesn’t take a genius to say that’s a big sector right now. For me, it’s finally hit its stride. I was kind of skeptical in the earliest days, almost invested in Ripple, almost bought a bunch of XRP the very earliest days, but I was in Ribbit and some other funds that were great. But right now, it feels like the whole world is broken wide open for crypto and I think it’s going to dramatically change the landscape of financial services.
And I say crypto, but I really mean blockchain and crypto. It’s not so much a Bitcoin phenomenon anymore. I think Bitcoin was the test case for does the blockchain technically work? And it technically works incredibly well, and now you’ve got all sorts of private chains and other types of instruments. I think it’s still in the first inning. The thing that gets me super excited right now is the whole concept of real world assets going tokenized.
Companies like Digital Asset Holdings. just exploding with volume right now. Or like Braille who’s enabling people, enabling other companies to create their own stablecoin. Or Securitize, who just got signed up with BlackRock and others. You mentioned Tether. Mesh Payments, digitizing the whole payment space for tokenization. I think it’s just the bottom of the bottom of the bottom of the first inning.
My prediction is, in 20 years, every single asset class is fully tokenized. I don’t think 100%. I think every asset class would go from 0% to maybe 80% tokens. I think you need 20% of it to be the old school world, to price the assets, to work the old school way. And slowly but surely, it’ll be 30, 40, 50, 60, 70, 80% and then someday, I’m sure, 100%. But that’s the space I spend a ton of time in right now.
Miguel Armaza: In that kind of future, what repercussions, what second or third order effects does this tokenization of assets have?
Steve McLaughlin: I think for better or worse, it’s going to be slow but sure, asset class by asset class, and it’ll be just a slow evolution. I think some of the traditional incumbents will morph and be players. Goldman Sachs, I just talked to the lead digital assets person at Goldman Sachs yesterday, and they’re evolving. They’re starting to trade digital assets. You talk about JP Morgan. they’ll have the JP Morgan token. So these big banks, they’ve got a lot of money, they’re smart, they’re going to come up with ways to participate in the sector.
So I think it’s going to be a meshing together of the old world and new world, a little bit like how FinTech and digitization of stock markets kind of just bled into the New York Stock Exchange. New York Stock Exchange bought Archipelago, and NASDAQ went from being pretty old school to buying a bunch of companies and becoming fully electronic. You don’t have guys running around the floor with tickets anymore. I do think some old school players will get wiped out over the course of time.
And look, can hardly believe we’ve been this long in the conversation, Miguel, we haven’t talked about AI. I’m not talking about Allen Iverson, although he’s a legend too, but he’s the original AI. And you’re from Philly. I am from Philly, exactly. I’m from Dr. J days. But AI is something to behold right now. Sure, we all love ChatGPT, we all love Claude, etc. But what is going to happen to financial services is going to be unprecedented. It is going to be the wave of all waves of FinTech, with AI attacking every single possible corner of financial services.
I’ve been saying this for the whole time I’ve been in FinTech, that financial services is such an incredible sector for technology in particular, because other than credit cards and Verifone terminals and ATM machines, which are all going away, it’s pretty much 100% a business of zero physical products. So zero physical products, when it’s all digital, it’s all numbers, it’s paper, it’s information, it’s risk, it’s controls, it’s compliance, across payments and lending and insurance and crypto and everything.
So it’s a space where there’s so much manual labor, there’s so much rework, there’s so much error, there’s so much fraud, that it’s just the perfect sector to get massively, massively destroyed by AI. And what I mean by that is the big, big, big insurance companies are going to have to adopt AI tools, and thousands and thousands and thousands of people are going to lose their jobs across all these big institutions. There’s no doubt about it.
I just talked to a mortgage company yesterday who is working with Palantir and Palantir’s new network to come in and essentially more or less decimate the cost structure of the company. it’s a pretty big mortgage company. It takes several years, but there’s no part of that process, almost no part of that process, that you really need humans doing. application, checking IDs, checking all the paperwork, collecting all the paperwork. that can all be done and checked and verified in a borderline errorless way. Same thing with underwriting insurance policies. The amount of data that’s available to underwrite an insurance policy, there’s no way humans can make as good a decision on that. Or claims. you look at Snapsheet using AI to adjudicate claims, do claims processing.
I think we’re unprecedented, even in our own business. I’ll give a shout out to a company that we just invested in. The world kind of knows that we have some capital, that we do make some investments. We just invested in a company called Model ML that I bet most people on this podcast have never heard of. It’s a company that is effectively trying to create, for short, the OpenAI of investment banking, or financial analytics, financial analysis. the stuff that banks and brokers and VCs and private equity firms do, like analyzing companies, ripping through a data room.
So we put a $25 million check into this company, Model ML. We led the round. We led a $75 million round. Hopefully by the time this podcast comes out, the press release will be out. it’s not known as we sit here and speak. We’ll coordinate at NerdCon. But these guys have a platform that’s able to, for example, look at an entire data room with thousands of files and folders and models and decks and PDFs and Word documents, and literally look through every single document and create, effectively, a first draft of an investment committee memo, or a pitch deck, or a valuation deck, or an overview, and do the valuation and do the comps, and look for buyers, and find errors between all the files, and look through all the audits.
You think about agent by agent by agent. This agent is going to look at all the audits and pull that stuff out. This agent is going to look at all the models and pull that stuff out. This agent is going to look at all the decks and pull that stuff apart. Then this agent is going to start comparing everything, and then this one’s going to start building up a presentation, and this one’s going to edit the presentation, this one’s going to ask questions of you.
That’s just a very broad scrape of a data room. But if you start talking about now I’m going to have a whole set of agents that just build models, or just look for investors. For example, I would say FT Partners is the best firm in the world if you want to find a list of investors who invest in your company, having done deals for 20 something years and having the list that we created for thousands of companies, and knowing who does what to whom. We’re going to be really good at that, but we’re not going to be as good as us plus AI, because AI will tell me, “What were the 1,000 growth equity investments made in the last week? Who made them? What trends are we seeing from those investments? Who might invest in XYZ stablecoin company?”
And those insights we’re already starting to see in some of the analysis and AI that we’re using. So I just think it’s something we’re doing for our clients. It’s not for us to save money or be efficient internally. We couldn’t really care less about that. It’s about how do we get a better answer for the clients? Because in six months, there probably shouldn’t be a deal done where the buyer doesn’t hire a company like Model ML to rip through 100% of the diligence information, read all the legal contracts, rip through all the models, and then summarize it and find where all the errors or omissions are in whatever’s in the data room.
So if you’re selling a company or raising money, you better do that first. What is someone else going to accidentally, inadvertently find, even if it’s just an accidental error or whatever? So we’re kind of providing those tools to our clients on the sell side, so that the buy side gets a more crystal answer of how the company should be evaluated, and that there’s no surprises. We’ve been doing that kind of thing with our data science team and our financial forensics team for years, but you start adding AI and ML and it’s wild.
Miguel Armaza: Yeah, and I know you have a lot of data and a lot of research internally. What does a tool like Model ML do to the nature of the entry level job at FT Partners? How does it change?
Steve McLaughlin: I think it gives everyone superpowers. It won’t eliminate a single job at FT Partners. If anything, we hired 25 more people. So if you’re listening to this, you want to, and you’re a complete baller, hardworking stud, and amazing banker, shoot us a resume.
But if I’m an analyst and someone says, “Hey, go check this book for errors,” and I can hit a button, and in 15 seconds it checks the book and will find 15 little things that are wrong with the book that would have taken hours and hours and hours to find, and it will find things you would never have found. and when it’s done, you won’t find any errors. Or if you say, “Go build a DCF model with 16 different scenarios. Go calculate the WACC, go calculate the beta,” it’ll be able to do all that in 10 seconds. And then you could say, “Well, actually, I want to build out three more years and change the growth and lower the growth rate each year by 15%”. it can do that in 10 seconds.
So it’s going to make analysts much more faster, much more efficient to do the basic rote things. So much of banking is you have all this information in your head, and you know literally exactly what to do to model it. But it takes you hundreds of hours to do the modeling. But if you can just sort of tell the computer, tell the AI to go take these source files, create this, look at every other model I’ve ever created, and say, “I want a multi-continent model. I want to break it out into these four lines of business.” I mean, you do have to tell the machine what to do to some extent, but it can take a stab at it, and you say, “How did it do? Now let’s improve upon that. Let’s improve upon that.”
One of the things that we’re doing as a firm, Model ML is going to, as part of the deal that we did with them, we’re going to become the lead design partner for them. So they’re looking for the most intense, elite investment banking experience, and saying, “What would the most intense investment banking experience be in building models and building decks and looking for buyers and looking for investors and building data rooms and analyzing data cubes and all that kind of stuff?”
They’re going to install at least four full-time employees in the company, looking at all of our workflow, looking at how we do things and how it can be done better. What’s the most deep work that we do that’s highly repetitive, that takes a lot of time? We’ve already got a list of 20 things that they can sink their teeth into. So their product isn’t fully developed yet, so they’re going to be fully developing it with us. So we’re one of their design partners, and we’ll be a key design partner for them. So it’ll be big.
Miguel Armaza: Speaking of AI, animal spirits are high in AI, both in private and public markets. Are they ignoring any of the FinTech lessons from 2021?
Steve McLaughlin: That’s a good question. I think the difference is, you have to go for it. If everyone knows this is big, I’m gonna go for it. And by the way, the lessons from 21. because they’re so fresh. the thing I love is if you’re taking this kind of risk now, you know you’re doing it, the investors know you’re doing it. Everyone knows it’s super risky, but you’re doing it anyway. And I think that’s the essence of venture capital, where you’re really taking a risk.
But look, Model ML is a good example. They’re gonna put a lot of money into developing code and doing design partnerships, but they’re not gonna put any real money into just stupid marketing, like throwing parties, getting fancy offices. So we gotta be kind of frugal, but we want to go kill it too. We want to go build a big business in a very, very smart way. If the money all goes into product, and you’re building product at five times the speed, at one-fifth the cost, the product can be just that much more incredible.
If you were to use AI to look at everything I’ve ever said in every podcast, how many times I’ve said, “We’re product people.” So we’re bankers, but we understand product. We build our own product. We built our own databases, our own systems internally. We don’t use Salesforce. We build our own deal cloud type platforms. So we look at our clients’ products and say, “That’s where the money has to go.”
We just invested in a company. I can’t say the name of it. but it’s a very broad platform that competes with an existing incumbent with a $15 billion market cap, and they built the whole platform. it is better than the incumbent. on $10 million using programmers in Pakistan making $12,000 a year, developing at high-end AI rates of productivity using high-end AI tools to develop a high-end AI product.
So putting really good money to use in product. I’d say yes, I think the money is being raised at more fair prices in most instances. But look, someone was saying the other day they think OpenAI is going to zero because they’re just spending way too much money. They’re burning ridiculous amounts of money to create something that obviously they think is going to be worth many, many trillions of dollars. But there’s a lot of people, not me by the way, that say, “Look, there’s going to be 15 of these things. They’re all going to do the exact same thing and we’ll race to the bottom. You’re not gonna be able to really make any money, because you’re just kind of providing the same service and it just takes too much compute to do all these things, and too much storage and too much energy and everything else.”
Who knows? I don’t think that’s the case. We just invested in Anthropic ourselves at some crazy valuation, $300 billion or something. So we’re excited about these businesses.
Miguel Armaza: On that point, how connected is the fate of FinTech to the rest of the market. Nvidia, all the hyperscalers, the foundational model companies? If that were to go through decline or a rocky period over the next few years, how connected is fintech?
Steve McLaughlin: I don’t think it’s directly connected. If Nvidia blows up and some Chinese company starts creating chips, that’s fine, who cares? It shouldn’t affect fintech. But my guess is, if it blows up, it’s probably not good for anybody. So I don’t think of it that way.
I just think people need to have more faith in FinTech. Okay, guys, just because XYZ companies blew up and someone overpaid and they lost money. that’s too bad. That’s called venture investing due diligence. Be prepared to lose some money and hopefully have some wins, some losses. But some of the best investments made were probably during 22 and 23 when FinTech was dead. If you could get into Revolut at $20 billion, or get into Stripe at $40 billion, or get into Klarna at $5 billion. that was the time to really dig deep and get into fintech.
So I think FinTech. there’s one lesson, and I’d say this, I’m more confident about this today than I have ever been, and I’ve always been a big proponent of the FinTech space. the way we define it is technology touching financial services. To me, the opportunity is bigger than ever.
The reason why InsurTech kind of flopped is because insurance companies themselves are so old school, so slow to change. And consumers don’t buy insurance that much. But I think in the world of AI, these insurance companies have no choice but to change. They will be extinct without buying AI tools. So I think, by the way, one thing that’s been a bit of a revelation is the fact that Palantir is now creating really, really high powered tools to go into these financial services. So I think it’s not just gonna be FinTech companies. It’s gonna be people like Palantir and others creating tools to go into insurance companies.
But at the same time, there will be brand new insurance companies built from scratch, and brand new tools in finance. There’s another company we’re talking to. I can’t say the name of it. but they’re raising money to essentially compete with Palantir. Sounds hard to say that a startup can compete with Palantir, but they’re creating their own versions of Palantir for specific verticals. I think it’s a bit of a question: will the Palantirs of the world win, or will these vertical solutions win within financial services? The jury is out, but it probably is.
Miguel Armaza: I think this is also the year that the rest of the world, people outside of FinTech, unlike us, has realized that Fintech is going to produce multiple $100 billion-plus businesses across many geos, right? Not just Stripe, not just Revolut. There’s a lot more. One that I wanted to ask you about, because I know you’re close to them, is Bilt. I think it’s a misunderstood company by the market. Maybe talk a little bit about them.
Steve McLaughlin: Yeah. So first of all, the one thing I’d say is the thing that makes companies great are the leaders. At the end of the day, Nick Shransky. you could strip that guy of every dollar he has, throw him on the street naked, penniless, and he would pop up creating another trillion dollar company. I have no doubt in my mind. He’s one of those kind of guys, just a force of nature. I’ve never met someone who is so well connected, so smart. He is the full package, this guy. And he’s built an incredible company where he had a vision.
He saw that there was an unmet need of renters. Number one, renters have a lot of issues in terms of trying to find the right apartment, trying to pay their rent, and not getting any cash back, not being able to use credit card. So he kind of took that whole world of renters and said, “You know what, if I just go renter by renter, it’s a B2C play, and that’s a race to zero.” So he said, “Look, I’m going to go top down, I’m going to sign up every major property owner in the country, and eventually the world. And then as I do that, I’m going to become their payment provider, and have it so that everyone in every unit of every building has to pay using the Bilt payment network.”
Well, once I do that, then I’ve got an app in every single renter’s pocket across the country, and then I can start serving them up rewards cards and things like that. So he kind of created this massive closed ecosystem that now, I would say, it’s impossible for others to kind of break into, in the way that he’s done it. And he can serve up product after product after product. And now that he’s got all the renters, those renters then become homeowners, and there’s homeowners associations, same thing. So kind of created this incredible closed loop ecosystem that he’s able to monetize incredibly.
Then you say, “It’s a misunderstood company,” and I wouldn’t say. but the people that spend time with them, it’s not misunderstood. The people that think it’s a credit card company or a plain Jane payments company, that don’t understand the closed, highly network effect ecosystem that he has, are really missing out. And of course, since we just helped them raise hundreds of millions of dollars at $10 to $11 billion in valuation, people start to say, “Wait a minute. I didn’t understand that before, but they must be doing something right if everyone’s throwing money at them and FT Partners is working with them.” So yeah, huge fans of those guys. It’s a company that’s just a juggernaut.
Miguel Armaza: I had a chance to spend some time with Ankur Jain last week, and he’s coming on the pod. And your name came up, obviously.
Steve McLaughlin: Hopefully he said good things!
Miguel Armaza: So Steve, before we go, tell us. I mean, you’ve kind of answered this question, but what has you the most exciting about FinTech in the short term and in the long term?
Steve McLaughlin: You know, I could talk about this sector, that sector, this geography, this type of company. But to me, in a weird way, it’s building our own company. We have 250 amazing people that come to work every day, or work from home as well, and they are just incredibly smart, hardworking people. I had to give some pep rallies during some of the periods of time where it was harder to get deals done and said, “Look, what we do never, ever, ever goes out of style: doing super deep work, being super earnest, supporting founders, supporting VCs, supporting companies, and growing and getting that much, much, much needed capital or M&A that they needed.”
It’s super fun building the team and inventing all these things that we’ve invented and getting into AI ourselves, building our own technology, breaking records on valuation in every single sector. And then seeing the smiles on everyone’s faces when we do good things. And yeah, seeing people that I knew when they were kids grow up to be real adults. A lot of people that are MDs here were associates, trying to figure out how to do all the analytics that we do and how to learn fintech. And now they’re 40-year-old complete ballers, winning deals, executing deals and doing great things.
So to me, the most fun thing is just getting to know all the entrepreneurs and doing deals and building our own company. At the end of the day, people forget we’re a business. We’re not just doing a couple deals here and there. We’ve got a business to build and gaining equity value and building a team and building a reputation and building a brand and building client loyalty and that kind of thing.
So to me, just like always, I think of my team and how thankful I am for everyone coming to work every day and being winners, being there for the great moments, the tough moments. So yeah, that’s probably the thing that’s most exciting to me. If you look, if you don’t love what you do, what’s the point? If I ever stop loving what I do, then I’d be shocked. But because I love this job. I just said to my wife the other day, sitting at my house, “I actually love this job.” There must have been six good things that happened that day. Some days they’re not as good. But I really do think that way.
And I love seeing my team members succeed. That’s probably the biggest, most proud thing. I like seeing companies succeed, the clients, it’s great. But the people that help build the company. that’s probably my pride and joy.
This interview has been edited and condensed for clarity.
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