Traction Podcast
00:36:49 · Roy Luo
[00:36:49] S1: in terms of how we outreach, not necessarily. I would say that this is still a human driven industry. At the end of the day, we're very focused on building relationships, spending time, whether it's on Zoom or in person, with these founders, being partners to them even in advance of actually making an investment. We have a large community and a ton of resources that we try to bring forth and actually be helpful to businesses in really unique ways even before we actually make an investment. So I wouldn't say it's necessarily changed how we go about that part. I will say that there is obviously tooling and things like that that will enable us to be more effective at our jobs, and it's transforming the way work generally is done. But, ultimately, how we find these, it's a combination of a few things. There's, I would say, thesis driven investing. There's just like the network and the world that we live in, and we just hear, like, the buzz. There's references. There's a network of people who've also invested either early or later stage in different businesses. We are talking regularly with buyers over the world, whether it's at the enterprise level or at the small business level around where their pain points are, what they're thinking about, the trends, and the macro dynamics that they're dealing with. And that helps guide us in thinking about, if this is a recurring problem for restaurants, we should think about different technology solutions that might be out there that is trying to solve this problem or something like that. And so it's an art at the end of the day. We have a great team at Iconiq that is leveraging every single tool and every single vector that we can think of that I've just talked about to try and find really great businesses out there. But nothing gets done without having a conversation and be able to meet these founders where they are.
00:38:31 · Lobo, Roy Luo
[00:38:31] S2: 100%, man. Anytime you incorporate more than two senses, you start to build stronger connections. We're like sound and sight. If we hung out, we'll probably spend more time. It would be taste, touch, smell, and then that starts the relationship for more and more meetings. I tell you, do you guys do a lot of events as well? [00:38:49] S1: I don't know what a lot of counts as, but we definitely do events for sure. We have a great team here that's putting stuff together. We also do really cool, I would say, like CEO gatherings within our portfolio, also outside of our portfolio. We have a technical advisory board with some really rock star engineers and technical leaders, and there are different topics and themes that we host fireside chats on, dinners, things like that. But there's a whole robust calendar, and none of it can be done without the amazing people that we have on this team here at Iconiq to make it happen. But it's a way for us to bring more to life the community that we've cultivated. [00:39:23] S2: Definitely. And and and a lot of people that you guys can bring as Iconiq are typically inaccessible. So you have that opportunity, not only cultivate the relationship with the founder, but actually be helpful for the founder. Right? If the founder can walk away with you or at your events with one connection that changes something mediocre in their business and makes it iconic, I think you've made a friend for life kinda thing. Right? They'll... Even if they may not do a deal with you, they'll pass through other deals when they come across.
00:39:23 · Lobo, Roy Luo
[00:39:23] S2: Definitely. And and and a lot of people that you guys can bring as Iconiq are typically inaccessible. So you have that opportunity, not only cultivate the relationship with the founder, but actually be helpful for the founder. Right? If the founder can walk away with you or at your events with one connection that changes something mediocre in their business and makes it iconic, I think you've made a friend for life kinda thing. Right? They'll... Even if they may not do a deal with you, they'll pass through other deals when they come across. [00:39:57] S1: Absolutely. We very much believe, again, it's a human driven business and world that we live in, and all you really have is your reputation and your credibility, and we're very results oriented. In the way that we want our businesses and our founders to be impact driven, we wanna be impact driven ourselves. And so we literally track how many introductions are we making, what are the outputs and outcomes of those introductions, What are the commercial impacts of those introductions? What are the... Who are the hires that we'll able to help reference? We are very relentless in analyzing and tracking what we're doing for our portfolio companies so that we can hold ourselves accountable for actually living up to what we're selling, which is partnership at the end of the day. [00:40:40] S2: Awesome. As you look through 2025 and beyond with this massive technological shift, AI, agentic AI, what are the biggest opportunities in fintech, and what specific trends will define the next generation of fintech?
00:40:59 · Roy Luo
[00:40:59] S1: Yeah. So I think there's a lot of really interesting theories, and we're keeping a weather eye on it. It could defend... Because fintech can be a very broad definition. Right? But I look at No Further Than Ramp as a great example where AI is driving so much of the value that they have in terms of being able to basically automate a lot of expense management spending, things like that. FloQast is doing the same thing where effectively they are adding AI to transform the way accounts work. How do you close your books? How do you track expenses? How do you categorize these expenses? How do I find the receipt and match it to a business purpose? Things like that. There's so much that AI can do and be layered into the product to drive efficiency impact. And I think these businesses are really leaning in hard to really basically completely transform the way their customers actually engage and go through their day to day. There's also a broader, I would say, call it commerce side of fintech, and we could talk about anti fraud. We could talk about chargeback management. We could talk about low low cost route optimization, optimizing off rates for payments. There's so many different things that I would say AI is adding further intelligence to and being able to increase the output economics and efficiencies of how commerce is really done, whether that's cross border, domestic, whether it's online, in store, whether it's retail, food, it doesn't matter. Like, the way commerce is being transformed, way payments are being transformed. There's a whole new category around, like, returns and returns management and logistics and shipping and how AI is optimizing routing and decision making and cost management and all those different categories. There is so much going on, and I think AI has really just supercharged all of these trends in these different categories and different markets. We could talk about wealth and banking and how the angle of customer service or customer engagement with AI bots, with AI agents, you can actually deal with a lot more customers from a customer service perspective. Like, it's transforming the banking industry.
00:43:09 · Roy Luo
When you think about how AI and technology is actually changing the way wealth managers actually work with their clients and engage and make decisions, there's a lot that's going on there to actually transform and change the economic model, honestly, in in the way these old industries have always worked. So it's pretty cool to see, and we're keeping track of all of this and really trying to make sure that we're staying in front of it all and forging partnerships and investments that are really backing the way we're seeing the world.
00:43:44 · Lobo, Lobo
[00:43:44] S2: I think AI creates a lot of abundance. Everyone's afraid that AI is gonna take their job. But what AI is gonna be really good at is level you up at work, give you more agency, create more abundance. I think it's a bigger market in the sense that when you're selling to role replacement versus tools, it's like trillions versus hundreds of billions game. But, also, you're giving people a lot of agencies so they can level up and do more with less. So I I love that you're you're saying that. I think banks... Man, I hate banks. Tell you. It's a lot. I spent... When I had nothing, I would line up and when Boast was a small startup, I would line up at Bank of America to send wires. Okay? And even adding anything or removing anything is like, you're on hold or you gotta take an appointment. And then I think my life changed. I think my investors at Boast, one of the best things they did to me was they connected me with Morgan Stanley. Yeah. And the technology doesn't matter in the sense customers care about outcomes more than products. When I can email somebody or text somebody and get a response in minutes, that is the best experience ever. I have peace of mind. Especially when it comes to money and people are proactive and responsive, you gain a great sense of comfort. [00:45:07] S0: And then you're like Trust. Trust. Exactly. And trust is