News & Insights
Blumberg Capital portfolio news, startup growth resources and industry insights
By Greg Brainard, senior associate at Blumberg Capital
Every fall, founders, operators, investors, and enthusiasts gather at Money 20/20 in Las Vegas to discuss all things fintech, an industry that accounted for 15% of the $195B in U.S. venture funding in 2022 through Q3. This year, over 11,000 attendees joined from around the world. Of the myriad topics discussed throughout the conference, coffees, and cocktails, four trends stood out:
1. Demand for Insurtech Infrastructure
Insurtech has been one of the most impacted industries in the recent market downturn. Many public P&C insurtech stocks are down 70% or more YTD. However, insurance is still an industry plagued by manual processes and inefficiencies. Especially in commercial insurance due to its fragmented market and niche players, a modern infrastructure stack is needed to increase visibility, speed of deployment, and premium written.
This creates an opportunity for entrepreneurs to build innovative insurtech software solutions to bring insurance players further into the digital age. Blumberg Capital portfolio company Joshu, which provides infrastructure for building, distributing, and growing digital insurance products, is a great example of a company innovating in this space.
2. Risk & Compliance are Top Priorities
Compliance and risk mitigation continue to be mission critical for fintechs. Many fintechs have global ambitions and are turning to vendors who provide compliance infrastructure across each geography they want to operate in.
Additionally, we’re continuing to see applications of AI in underwriting, credit models, and risk mitigation. With more data than ever before, companies are turning to AI to drive their compliance and risk mitigation strategies.
3. FinTechs are Going Vertical
While vertical fintech has been a trend for some time, there are many opportunities for payments, lending, and banking products tailor-made for specific verticals. Underserved industries like logistics, supply chain, capital markets, healthcare, and insurance are seeing continued innovation in the fintech realm.
This presents the opportunity for founders and builders to take their fintech expertise, combine it with unique vertical insights, and create innovative products that better address customer needs. Blumberg Capital portfolio company WorkJam, a digital workplace for frontline employees, has capitalized on this opportunity by releasing ExpressPay for fee-free same-day payment of employees.
4. Crypto as a Financial Services Primitive
There is a continued proliferation of crypto as a means to facilitate financial services. Global providers are making use of the instant settlement and programmability of blockchain to offer innovative financial services products across the world.
Entrepreneurs have the opportunity to use the financial building blocks (“money legos”) provided by blockchain to come up with novel solutions to advance economic freedom around the world.
Fintech is an industry with an exceptional amount of room for growth. At Blumberg Capital, we’re looking to back visionary entrepreneurs building innovative solutions across enterprise fintech including in insurtech, payments, risk & compliance, lending and banking. Keep tabs on fintech industry trends and emerging tech here.