‎Hey Fintech Friends!: 🎧 Podcast: Hey Fintech Friends ft Emily Man on Apple Podcasts

‎Show Hey Fintech Friends!, Ep 🎧 Podcast: Hey Fintech Friends ft Emily Man - 26 Apr 2023

Apple Podcasts

Timestamps

0.55: Fintechionary (Public Key)

1.55: News

5.07: Emily Man Interview

30.28: Emily Man quick-fire session

39.65: Signals 'Why fintech has failed Mexico’s unbanked'

42.05: Events

Transcript

Helen 0:00
Hey FinTech friends.

Hey FinTech friends. My name is Helen Femi Williams and I'm your host of Hey FinTech friends. I hope you're doing well. I know I am.

So let's talk about the structure of this podcast. We're gonna go through the FinTechionary, the news. And if you subscribe to The this week in FinTech newsletter, you're in luck because this is the audio version. Then we're going to have chat with this week's friends Emily Man, and then we'll go through signals and events. So hope you enjoy this episode.

Fintechtionary: Public Key

According to Investopedia, a public key is a cryptographic code that allows users to receive cryptocurrencies into their accounts. The public key and the private key are the tools required to ensure the security of the crypto economy.

When a user initiates his or her first transaction with bitcoin or altcoins, a unique pair of a public key and a private key is created. Each of the keys consists of a long string of alphanumeric characters that help to keep a user’s holdings secure in the digital ecosystem.

The private key is known to the user alone and serves as the user’s digital ID. The private key authorizes the user to spend, withdraw, transfer, or carry out any other transaction from his or her account. A sophisticated algorithm is applied to the private key to generate the public key, and both keys are stored in a digital wallet.

1.55 News

5.07 Emily Man Interview

Emily is an investor at Redpoint Ventures where she focuses on fintech and b2b software. Her investments at Redpoint include Ramp, FloQast, Orca Security, and Proper Finance. Prior to Redpoint, Emily was at Point72 Ventures where she helped launch the early-stage fintech venture investing strategy. She started her career there on the public markets side as a long / short equity analyst. Emily earned her BA from Columbia University where she graduated summa cum laude.

Helen 5:29
Great to meet you. Thank you so much for coming on. Hey, FinTech friends. How are you? Where are you based?

Emily Man 5:34
I am based in sunny San Francisco.

Helen 5:37
Amazing. I heard such good things about San Francisco. Do you like living there?

Emily Man 5:41
I do. Yeah, I actually moved here a year and a half ago from New York. And so they're, they're quite different cities. But both all have their unique quirks.

Helen 5:49
What's the pros? What's the cons of either.

Emily Man 5:52
I mean, New York is just so much bigger and denser. Right, just as the city in terms of everything that's happening. San Francisco has some incredible weather and nature, that is within your reach, and just like a 30 minute drive away, right. So, you know, that's been that's been really fun.

Helen 6:12
And the cons of San Francisco and New.

Emily Man 6:15

New York is crazy busy all the time. And there's always something to do. But you're always, you know, stuck in the city. Whereas in San Francisco, it's awesome and easy to get away. But you know, it can feel a little bit quieter when you're used to be insanity. That is New York.

Helen 6:36
Yeah, I was in New York last year. Sometimes I felt like it was a little bit too much. Like, right, yeah, it's just like, Guys, relax. Like, why isn't everyone chill? What is wrong with the city?

Emily Man 6:46
New Yorkers have no chill?

Helen 6:49
Yeah, but like coming and like being from London, I just thought it'd be like, Oh, save? I'm like, nah, this is like times 20. Like we chose sometimes

Emily Man 6:55
I studied abroad when I was in college, and I spent a semester in London. I was at UCL. So okay, I don't know, I've gotten like Big City Hall. A little bit around the world.

Helen 7:10
That's good. Probably a good point. Like, Tell us. Tell me a little bit about you. Who is me, man? What are you up to?

Emily Man 7:19
Yeah, no, absolutely. To start, I'm a global citizen. Right. So I actually grew up around the world and moved around a tonne. I've always been fascinated by global markets, technology, and in particular, kind of how this impacts the underserved or easily forgotten kind of pockets of folks that get left behind. I'll spare you the full details, but I'm currently an investor, here at Redpoint focused on FinTech as well as software. More broadly, I've been investing for the last six years or so across a bunch of different domains. But I think overall, Fintech is where I've spent the most time and it's, you know, where my nerdy interests and go,

Helen 8:09
If we circle or take a step back, how did you get into investing?

Emily Man 8:19
Gosh, take it all the way back, I actually started investing the beginning of my career, right.

So when I was in undergrad, I always knew that I wanted to do something related to the global markets. And I had a fascination with the way money flows around the world, I kind of found myself in my first job out of school at a hedge fund in New York doing public market investing.

And that was an incredible starting point. And I had learned so so much just about, you know, how do you evaluate and look at a business and what makes the stock move?

Ultimately, then I kind of realised like I really gravitated towards the types of companies that were being innovative, that were cutting edge that were really changing and shaping the ways that our world looks today. And so actually fell backwards into venture investing a little bit kind of met my boss. But there were a lot of financial institutions as well as demographics or communities that were being left behind in the rapid pace of evolution, and how he was really excited about investing in the types of companies that would help even that even in bridging that gap.

And so I actually went over there to help them build that business out and have sort of been in venture investing ever since

Helen 9:57

Is there a particular type of company you look for? Or like, is there a specific space within FinTech that you find the most interesting?

Emily Man 10:12
I mean, I think there's so many different pockets of themes and things that are happening that are really excited. I find myself that I gravitate a little bit more towards b2b and infrastructure. fintech.

Emily Man 10:29
At Redpoint, we were early investors and I've spent a lot of time with the the French ecosystem and the UK ecosystem.

Berlin has a burgeoning FinTech scene too, as well as a couple years ago did a deep dive into everything happening in Southeast Asia. I think in many years, in many ways, it looks like it's like maybe five years or so behind the spirit of innovation that we saw across Latin. And that's probably going to be the next up and coming region, we have spent some time in Africa, as well, but not as much, it's just a little bit further away from home.

Helen 11:20
So I mean, pretty much everywhere. Why do you think that South America, sorry, Southeast Asia will be the kind of next big place to innovate? Yeah,

Emily Man 11:29
There are a couple of reasons

And I think a lot of them are very similar to what made Latin America such a rich ecosystem, broadly, which is that when you have very high, like large population sizes, that are very highly educated, that also have very high mobile phone penetration rates, which has increased over the last, you know, decade or so.

And that creates this ripe ecosystem for, the proliferation of financial tools and services, I saw this firsthand, growing up in China, what really made us move from being a cash based society to something that was pretty much all app and instant payments based. This was the fact that there was a smartphone in everyone's pocket

Right. And that's everyone from like, the street vendor who's selling his fruit all the way through to, you know, a businessman, you know, travelling the region on business.

So that's kind of some of the elements that are in place there. I think, if I pick one country, Indonesia, in particular, the government there has created a pretty good environment for innovation to flourish.

So you have similar dynamics to what happened in Brazil, where you do have like a couple of very large financial institutions that have pretty much had a monopoly over the space and have concentrated in a lot of users.

And then add on top of that, if you have a regulatory environment that's open to new entrants, that is open to innovation, then you create this ecosystem.

Helen 13:20
I actually used to live in Malaysia. And like, I think that's one thing you do notice, in terms of like smartphones, also, in terms of just like access to the internet, doesn't really matter where you are, it's like, in a lot of ways, like way more advanced than like when I came back home because it doesn't really matter where you are like Wi Fi is like everybody's number one priority. Wherever you go, whatever you're doing.

Emily Man 14:09
Exactly, no, but it's, it's been an amazing equaliser, and in many ways, right, in terms of the types of folks that can now afford to be a part of an ecosystem that previously they've sort of been like, left out.

Helen 14:25
Yeah, like the financial inclusion within like, Southeast Asia and Africa in all these places does seem to be growing because of that kind of the ubiquity between like being able to access a smartphone now that you just really couldn't, well, not really couldn't, but it was just more of a wealthier thing.

Whereas now it's a thing that people can't access, which is great. 100%. And so like, I guess, what is is that is that kind of like a fact or stat that you learned recently around this kind of topic or in general that you think

Emily Man 15:01
So one thing that I'm really a trend that I've really been tracking recently is around, you know, vertical software X fintech.

Right. I think that, you know, if you look at a lot of the largest vertical software businesses today, particularly some of the publicly traded ones, you know, good 60 70% of their revenues come from payments, right?

But the silver lining of that is now that we're kind of emerging in a post pandemic world, there's been a tonne of new business formation, right? I think, in the US alone, there were 5 million new businesses that were started last year. And these business owners are not only are they younger, more tech savvy, but they also are more demanding right of the types of tools and software that they have and use on a day to day basis to both run their personal lives, but then also their businesses.

And so what the stat that I'm getting to kind of is, really, interestingly, Visa did a survey, which showed that something it's something like 87% of merchants choose their payments provider at the same time as they choose their business software.

So I mean, I think that there's such a good opportunity to create vertical-specific business software that also includes the ability to accept and make payments all in one bundle. And to really capture this next generation of new businesses that are starting up. Yeah, I guess, I mean,

Helen 17:07
if you're not working in FinTech, your main priority is not like if you're starting a business, I'm trying to think of a random business, but x like, you're not thinking,

This makes sense. This creates ease. And that's all people want, like the accessibility. And I guess also, if you're, if you're starting this business, you don't even know if it's going to like how long you're going to do it. If it's going to be successful. You've got all these other factors to work about. So you just want to make it I guess what you're saying is like, how can we just make it as easy and accessible for the like, non tech savvy person to be able to just pick up and get it

Emily Man 17:47
right, I think, yeah, exactly. I mean, I think look, everyone knows that. Regardless of what business you're starting, being able to accept payments is pretty much table stakes.

So whether that's, I am, I'm starting a new bakery, I need to be able to take credit cards from my customers to like, I don't know, I run a scrapyard, right, and I need to invoice you know, towing, like tow companies that I work with.

So both sides, there's this need to kind of, you know, have the ability to take and accept payments to facilitate the business they run. But that's also not the core focus of like, No one wakes up. No, none of these business owners wake up thinking like, gosh, like what like stack Am I sitting on from a payments acceptance perspective, right?

So I think there's just such an opportunity for folks to build software that is like, th very much focused on like, how do I run day to day operations of, you know, managing inventory, managing staff, and managing, you know, my menu and things like that, and then bundle into that.

Things like payments, acceptance things down the line, maybe like, you know, loans, or buy now pay later, maybe even payroll, and create new revenue streams that are on top of just the software itself.

Helen 19:14
Yeah, that sounds great. Just like put it all together. Just eases the process for everybody. Well, yes, everybody evolves. So it just makes it simple and easy. For everyone. I want to talk more about you?

What's the most bizarre question you've had to ask a potential company or person that you will invest in?

Emily Man 20:08
There's definitely moments in conversations where I've had, where I've had to, you know, ask nicely, like, hey, you know, is this actually going to work from a regulatory perspective?

Helen 21:06
Yeah. Do you find that like, what, like startups are thinking about regulation when they come in? Because I guess, in some ways, right? If you're creating a startup that might not be, it doesn't necessarily have to be in FinTech. But you're solving a gap that potentially maybe like, has been created, because, like, legislation is just not there. So like, is that something you find where you have to be in conversations around like, Well, have you actually thought about the law?

Helen 23:33
What's the event or thing that will stop you working as an investor?

Emily Man 23:56
overall for FinTech, I have like a cheeky answer, which is I'll stop in working in FinTech and investing in FinTech when it stops being a category. Right.

And I think that that actually might be you know, we're not that far off and might be sooner than you think. Because if you really think about it at the end of the day, like there's not a lot of commonalities that tie some of the like, further ends of FinTech together, right, like a wealth managers.

While there are commonalities around managing risk, or managing fund flows, I see a lot of these distinct areas and distinct businesses that of all come together under this one umbrella of like fintech.

I think one of the benefits of being an investor, as you said, you get such a broad view of what's happening right across different markets and different sectors and different industries.

Helen 25:10
S And it was kind of like, what have you ever had like a sort of 'oh shit' moment in your career?

I'm basically saying like, has there been a moment where like, everything was going well, and then, like, you did something wrong? Basically, you were like, oh, like, has there been a moment? Like basically when something went wrong? And you were like, Oh, shit, like, this is terrible.

Emily Man 25:52
Like everyday? Yeah, I guess I remember, I'm still a public markets junkie, at the end of the day, right. And so I feel like the last year and a half has been filled with a lot of ohshit moments.

Well, my portfolio personal portfolio performance, but also, you know, the FinTech companies have been taken a real beating in the public markets. So there's definitely a lot of ohshit moments there. You know, it's funny, initially, when you you know, when I'd seen this question, I thought that it was more of like, an Oh, shit, like a positive? Yeah,

Helen 26:36
well, let's do that, too.

Emily Man 26:39
've never realised that I think most recently, one of the one of the companies that I've backed at the seed stage is company called proper finance. They're building reconciliation as a service software for FinTech companies.

But, you know, I think, recently, they've come out with a new version of their product. And I saw a demo in terms of what it could do. And like that was like, oh, like, this is incredibly, like, absolutely just mind-blowing. And it's so funny because all of the potential customers or users of this product that they've showed it to since have had the exact same

Oh, shit, I didn't know if something like this could exist. And so I'm so pumped up about that. And like, so excited for them.

Helen 27:56
You get to see so many things go from like a baby to its end

Emily Man 28:12
Yeah, a lot of these things start as an idea, right? Like, it's like a couple people with an idea for what they want to build and how they think the world should look. And then, you know, watching that become like a reality. And I mean, knowing of course, like the blood, sweat and tears that have been poured into these process products.

Quick Fire

Would you rather be a clown who distracts the bull or the cowboy Who rides the

Cowboy?

Who was your What was your last impulse buy?

Emily Man 30:47
The Clinique black honey lipstick? I have been influenced by tik tok.

Would you rather live in a real haunted house? Or in the middle of a desert?

Emily Man 31:25
In the middle of a desert - I am no go with ghosts.

Helen 32:53
What non existent job do you wish existed? years are

Emily Man 34:06
hard, especially. Like, I don't know, Puppy happiness specialist or something like that, where all I would do is play with dogs all day. Like, that's my dream. That's my dream job.

Helen 34:52
Yeah. Which superpower would you not want

Emily Man 34:57
mind reading? I do not need to know what other people are thinking about? I feel like that that would just drive me nuts.

Helen 35:05
That is so fair. Ignorance is bliss. Would you rather become five years older or two years younger two years younger?

100% Would you be against the loss or

Would you rather live in a world with no caffeine or world was only cold food?

Emily Man 35:21
Ooh, that's hard. I really like lattes but I'm gonna have to cut caffeine now. Because I feel like as much as I love sushi the world would be a much worse place.

Helen 36:15
We've got to the end of our quickfire session. So I guess I have like, just like two more questions for you. My first is like, what do you think I should ask the next guest? That's the question I should ask

Emily Man 36:26
FinTech question. I always love to ask like, what's your what's your spiciest hot take on FinTech today, and always gets me some really interesting answers based on the domains that people are in.

And then the another one, it's just top of mind because someone told me this recently is what is a what is a popular TV show or movie? That you just did not get? Or you did not like?

Helen 37:13
Do you know what mine is? Was that show Breaking Bad? Controversial. I know everybody love it. Like it's the Bible. I thought it was just , very obvious what was gonna happen.

Emily Man 37:39
Clearly you are, you're very well versed in the making and making Meth

Helen 37:42
And money laundering

Amazing. Well, thank you so much, Emily, for coming on. Like this has been really fun and like short and sweet. Not that short. It's like been for 40 minutes, actually. But ya know, this has been great. So yeah, thank you so much for coming on the show.

Emily Man 39:32
Awesome. Thank you so much for having me.

39.65: Signals

Since 2016, when Finnovista conducted its first surveys of the Mexican ecosystem (which was then the largest fintech market in Latin America), fintech has made little progress in formalizing Mexico’s sizable unbanked population. The most recent National Survey of Financial Inclusion conducted by Mexico’s National Institute of Statistics and Geography finds that as of May 2022, only 49.1% of adults ages 18-70 had a bank account. While this is 3.4 million more than in 2018, it represents growth of only 2%.

Five years after Mexico’s famed fintech law took effect, the sector has failed to meet Finnovista’s prediction that it would “broaden the frontiers of the financial market through the financial inclusion of segments of the unbanked and underbanked population.” While many neobanks, credit providers, and payment providers have gained important traction in Mexico, none have managed to bring millions into the formal banking sector as anticipated.

In fact, if the World Bank’s 2021 Global Findex had included Mexico, Mexico would likely have had the largest unbanked population in the region, surpassing Brazil by over 15 million people.

The unseized opportunity is hard to overstate. Not only would greater financial inclusion in Mexico support the economic development of the country by encouraging savings and investment, expanding access to credit and increasing tax collection; it could also prove to be highly lucrative for those who crack the code and gain scale. Moreover, despite Mexico’s 42.6 million unbanked population, e-commerce in Mexico has nearly tripled since 2018, growing 23% y-o-y in 2021, pointing to a strong growth trend that could be leveraged to encourage greater adoption of formal financial tools.

Events

• Future of Fintech Luncheon - Galileo x This Week in Fintech
  Hosted by This Week in Fintech & 3 others MAY 4
• Reminder that Fintech Nexus USA is coming up this May 10-11 in New York City. This is the largest fintech event in the financial capital of the world, and there’s an impressive lineup scheduled to speak. Stephanie Cohen of Goldman Sachs will kick things off, and Simon Khalaf, CEO of Marqeta and Liza Landsman, CEO of Stash will make their event stage debuts since being named to lead their organizations. Fintech Nexus USA is two full days of keynotes, panel discussions, and workshops, covering a range of topics, including digital banking, fraud, embedded finance, lending, financial health, blockchain, fintech investing and more. And then there’s the networking. With 5,000 attendees and more than 250 sponsors, there will be more than 20,000 double opt-in meetings over the two days, and that doesn’t account for the networking happy hours and parties, including the official party on The Intrepid aircraft carrier docked on the Hudson. You don’t want to miss Fintech Nexus USA. Head over to fintechnexus.com/usa and use promo code Partner15_TWIF for 15% off your ticket.
• Bogotá Happy Hour with CIM & AWSHosted by This Week in FintechMAY17