MoneyNeverSleeps ep 100: Challenges of the Challengers and Top 10 Episodes

For the 100th episode of MoneyNeverSleeps, Eoin and Pete dive into their favourite topic – the challenges of challenger banks – and look back to the first 99 episodes to build out a list of their Top 10 episodes.

This episode is kindly sponsored by Ireland’s fintech and financial services recruitment specialists, Top Tier Recruitment.  If you would like an intro to the team at Top Tier Recruitment, please click here.

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Before we started the episode, we were thrilled to announce our inclusion in FeedSpot’s Top 20 Entrepreneur Podcasts You Must Follow in 2020. Thank you FeedSpot!

We start this week with the crossover of a few pieces of content from the past two weeks on challenger banks, in particular the Big 3 of Monzo, Starling and Revolut. Recent reports highlighted their financial results and compared and contrasted them, and one thought from Lex Sokolin of the Fintech Blueprint particularly struck a chord, as noted in a recent Sifted piece by Isabel Woodford.

To paraphrase Lex, if you look at the enterprise value per customer of each of these three digital banks, which is their unicorn valuations divided by the number of users, you end up at each customer being worth about $1,000 in enterprise value. So what?

Well, in the Sifted piece, Isabel Woodford neatly pieced this all together from Lex’s comments on the Rebank podcast. To paraphrase Lex (through Isabel!), each of the three companies is making $20-30 per year per customer in revenue – how do you go from that to over $1,000 per customer in enterprise value? Lex then dropped this nugget that got us thinking:

“Are these banks at all or are they media companies with financial services monetization?” – Lex Sokolin, the Fintech Blueprint

This is not a disparaging question – in our opinion, it’s just suggesting that banks with ninja-like digital skills, extremely efficient engineering and a laser-focus understanding of the true customer needs are playing a different game than old-school banks. Lex’s question is at the heart of what we dug into on the first half of this episode through the following stories:

Starling, Revolut and Monzo’s annual results compared (Sifted, 17-Aug-20)

Art Wittmann, Industry Research in “Chasing Profitability in a Changing Media Landscape” (Oracle NetSuite’s Brainyard) – how media companies make money

PRA challenges business models of new banks in consultation paper (Finextra, 24-Aug-20)

In the second half of the episode, Pete and Eoin each went through their Top 5 MoneyNeverSleeps episodes of all time to come up with the Top 10. Listen in to find out why, and also hear our ‘honourable mentions’, but here’s the big list!

Ep 99 – Peter Geoghegan and Democracy for Sale

Ep 93 – Be Direct – Zac Liew

Ep 57 – The Prediction – Andrew Mullaney

Ep 42 – Big Bank – Sean Faughnan

Ep 38 – Friends & Respect – Laura Smyth, Paul Smyth, Lisa White, Vessy Tasheva

Ep 37 – Fight for your Right – Graham Rodford

Ep 26 – Birds of a Feather – Ann O’Dea

Ep 23 – Money Made Me Do It – Elaine Deehan

Ep 15 – Angels – Chris Adelsbach

Ep 1 – The Re-up – Brian Norton

Thanks to all of our guests since May 2018 for their willingness to join us, their openness, their insights and above all else, helping us to figure out what makes them do what they do.  Please visit MoneyNeverSleeps for all of our other episodes.