Fintech Request for Startups

Today, we’re excited to launch our second Request for Startups. Last year's RFS saw more than 100 companies respond, many of which have since grown immensely and significantly impacted the way consumers interact with money. This year, we're hoping for similar success.

Financial technology is reaching an inflection point. Growth in the past five years has been largely fueled by the digitization of existing banking products. This "unbundling" of banking has enabled startups to gain rapid traction by delivering simple, digitally-native consumer experiences. However, digitizing banking is just a first step. A few areas that we're particularly excited about are below.

Consumer:

• Income Smoothing
  
  As contract and hourly employment continues to grow, so too do the issues associated with income volatility. With tools for income smoothing, there is an opportunity to improve the lives of the millions of Americans who would otherwise have to rely on payday loans and high-interest financing.

• Tools for the Financially Underserved
  
  In many cases, innovations in financial technology have catered to those with means. One in two American families struggle to cover a $400 emergency, and millions have little or no access to banking at all. Significant opportunity exists to build tools that cater to individuals that are poorly served by traditional banking products.

• Liquidity for Fixed Assets
  
  Many Americans’ primary source of wealth is tied up in their assets, from real estate to vehicles. A number of startups have begun to focus on improving the buy-sell dynamics in these industries, but a need still exists to offer near-term liquidity in the form of alternative asset agreements.

• Simple Tax and Estate Planning
  
  Tax preparation software is pervasive, but too few individuals plan beyond the current tax year. Opportunities exist to build simple (perhaps open source) tax and estate planning tools.

• Financial Tools for the Elderly
  
  As baby boomers age, more Americans will become responsible for managing their parents' financial lives. Financial planning and management tools for adults to care for their parents would be valuable.

Infrastructure:

• Consumer-Centric Loan Servicing
  
  The past ten years have brought massive changes to the loan origination process, but loan servicing has not kept up. Too many borrowers still struggle with confusing demands, clunky repayment services, and collections agencies. Without few viable options, many online lenders have even begun building their own servicing.

• Micropayments
  
  As news organizations and artists continue to search for scalable revenue, the notion of patrons has again become relevant. A browser-linked application could enable seamless payments across the web.

• Identity Validation Solutions
  
  Identity validation today still relies predominantly on credit reporting bureau data, but the world has changed in the wake of the Equifax breach. Validating an identity is a core part of nearly every financial product, yet few solutions exist that are not linked to the bureaus.

• Brokerage-as-a-Service
  
  As fintech continues to offer cheaper, simpler alternatives to traditional brokerages, there will be increasing demand for an API-driven brokerage and clearing service.

If you’re building something related to any of these (or thinking of doing so), please let us know at rfs@plaid.com. We'd like to do what we can to help, including:

• For companies located in SF and NYC, we’ll be launching a series of fintech meetups to explore particular topic areas with a set of experts. (We’re exploring an online version of this as well.)

• For selected new companies built on Plaid, we’ll be granting up to $12,000 of free usage to get started.

And a special thanks to the Plaid team, Hunter Walk, Satya Patel, Aaron Harris, David Haber, and Rick Yang for their contributions to this post.