Fintech Insider Podcast by 11:FS
00:29:09 · Maia Bittner, Laura Watkins, Vijay Konduru
And so given the alternatives, I actually think AI is a superior experience today, even today, and that it's just gonna keep getting better as the technology improves. [00:29:20] S0: Wow. That is a different take. Maybe, Vijay, we're we're sort of almost out of time here, but do you wanna just maybe round us off and and kind of respond to that? [00:29:29] S2: Yeah. As far as what Maya talked about, there are definitely situations or or users where customers might wanna interact with an AI chatbot, for example, more than they wanna call in, like like Pav was talking about. I do believe that there's a very important role that access to humans and human expertise will continue to play. Like, for example, let's say a customer has gone through a fraud event. Right? They want to be able to walk into a branch. They want to experience that empathy from a real human expert that can help them even though the AI might help them resolve that situation in an equally effective manner. So I still think the role of the human in customer servicing, in customer experience is very, very critical.
00:30:29 · Laura Watkins
[00:30:29] S0: Yeah. For sure. And then, you know, you're offering both so people could choose the course that they wanna take, which is the the most important thing that customers have the choice, and that's what they value the most. So on that note, we're gonna take a quick pause here back very shortly. Before we get back to the news, we wanted to tell you about our next After Dark event, which is only two weeks away now. It is taking place at the Village Underground in London on Thursday, November 12, where we'll be recording a live Fintech Insider news show, followed by drinks and networking with the fintech community. Tickets are available now at 11fs.com/ after dark, all one word. And there is also a link in the show notes below. Don't miss out. And back to the news. And our final main story this week is Acorns buys Gen Z social finance app Fritch. The story in Finextra, US savings and investment app Acorns has acquired Fritch, a social finance platform aimed at Gen Z. Financial terms of the deal were not disclosed, but founded in 2021. Fritch has built a community of 1,600,000 young adults who learn about money through peer conversations, group chats and creative content. The platform also allows users to compare their financial habits with those of their peers. The deal follows Acorn's acquisitions of children's money management app GoHenry in 2023 and family wealth platform Earlybird in 2025. And earlier this year, Acorns actually sold GoHenry's UK business to Barclays, signaling a greater focus on their US operations, while GoHenry US was rebranded and absorbed into Acorns family offerings as Acorns Early. So Maya, maybe coming to you first as a as a sort of product person on the on the call. Acorns has acquired a platform where young person... Young people, sorry, learn about money through their friends, through online communities. What does this tell us, about how Gen Z and and probably the generations coming up behind them want to engage with financial services and and and what it kind of means for Acorns to acquire this company in this way?
00:32:40 · Maia Bittner
[00:32:40] S3: How cool. I mean, I view this very similar to our Huntington story, which is that this is a growth and customer acquisition play, specifically by moving earlier. And everyone knows that the hardest part of fintech is frequently customer acquisition. And so they're trying to get new investing customers before they're investing and early on. I think the community and education angle is is really cool. I think that has been one of the advantages of the Internet for a long time is that you can be connected with people like you when those people might not go to your school or live in your town or be accessible otherwise. You can sit in your bedroom and calibrate with people who are like you. I think with money specifically, it's actually really, really valuable. There's another tool called Status Money that was doing something really similar where it lets you benchmark. Okay. For people like me, how much are they paying in student loans? How much is their car payment? How frequently do they get raises at work? And it really help... Helps people sort of ground themselves and understand, am I doing okay? Do I have, like, too fancy of a car given how much money I make? Should I be trying to save money on going out to drinks with my friends, or am I doing this a normal amount? You know, I think those are very, very normal questions for people to have about their finances. The finance influencers also always give people that kind of benchmarking. They will say, you should only spend up to 25 or 30% of your income on housing. You should only spend up to this amount of money on discretionary spending. And so, you know, I think people are really hungry for that. Acorns has actually done quite a lot of acquisitions. I think they've done almost nine. And so they must have a playbook. Like, this is working well for them. Right? They have a playbook. They are shutting down the French platform. And so I think it's less about keeping that community going and more about how can they bring that community into the Acorns platform, how can they add education and community to Acorns and sell the existing Acorns product suite to that group of millions that that Frint has collected.
00:35:00 · Laura Watkins
[00:35:00] S0: Wow. Thank you. Yeah. There's a... I mean, there's a lot to to unpack in here, but that that kind of peer to peer kind of comparison of financial habits is is certainly interesting. Pav, what's your take on on that? Does that sort of encourage better financial behavior? Does it introduce risks if like, you know, the the the loudest voice is actually the most wrong? Like, what is it... And what do you think of of that approach?
00:35:27 · Pav Gill
[00:35:27] S1: I mean, think it's a very savvy acquisition. You have basically acquired 1,600,000 potential customers, is that community size. And if it's run-in a responsible way, you know, with the right moderators and the right parameters, then of course it's great idea. I think it goes back to what the point that I was saying earlier, which is Gen Zepho, you know, which is primarily this market, They do support each other, they do listen trends, follow them, you know, we've seen crazy trends from before, which were very positive on TikTok, but I think this one could be made very positive. My my bigger question would be, think the risks cannot be avoided. I'm not trying to like be always like the doom and gloom guy as a lawyer, but the risks are definitely there, right, because from my perspective, it's it's an Instagram generation. So there is naturally that flaunt aspect to this, and because of that, there's a need for validation as well, and the risks would be how are people comparing, because someone who's just had, say, $10,000 as earnings could have 20,000 in debt, which is undisclosed. So how is it being positioned? What are the guardrails? Is it going to create competition in an unhealthy manner? Or is it gonna be a gamified experience? I don't know. Is it just just purely like a very chill, yeah, you know, I invested in this, I did this, I saved this amount. If anyone wants to know, they can DM me for further info. Because the risk with all these things is it then becomes some kind of like investment fraud. Right? Which one of these guys is trying to like whip up. So that's just where I'm coming from, but of course, like, as a business acquisition, I think it's extremely savvy.
00:37:17 · Laura Watkins
[00:37:17] S0: Yeah. Absolutely. I mean... Yeah, and to your point on the the sort of what is and isn't disclosed, like, you know, in The UK this year, we've had this sort of crackdown on quote unquote finfluencers promoting financial products illegally. So there's definitely a a sort of a risk factor in here and a kind of security concern for for those sort of maybe oversharing some of their financial situations as well. But there's, yeah, there's definitely something to be said for Acorns making an acquisition of this kind and sort of immediately just taking on 1,600,000 customers that they didn't have before at a young age that will hopefully mature within the rest of what of what Acorns has to offer. I mean, Vijay, you, you know, you mentioned in your previous role you were a CMO. Like, would that have to hunt? Like, what do you think of the... Of a... Of an acquisition like this?