1044. News: Revolut launches £65-a-month ultra-premium business card to take on American Express

24:55Laura Watkins:But also, to everything that you just said, I completely agree. But also, despite that kind of confidence when they do have that affluence and the ability and the knowledge and everything, it also still feels like they're kind of underconfident in what it actually means to be financially successful as well. So the other stat, when asked how much more they would need to earn to feel financially successful, the average high-earning woman who's on 100K or more, as we said, said that they would need to earn at least 149 ,000 more to feel wealthy. and this equally was supported in a different report which revealed that over 200 ,000 is a salary needed for one to feel wealthy and sort of perceptions of wealth kind of evolve on a spectrum.

25:41Laura Watkins:Rebecca what's kind of your thought on that how do we sort of support women to just feel financially confident as well as sort of be financially confident if that makes sense? Yeah, completely. And I think that need to or perception that, you know, I need to earn more to feel successful, to be wealthy was kind of broadly on par with high earning men. And I do think there's a bit that the more you earn, the more it actually takes for people to feel like they're being financially successful. That was supported with a wealth report that we ran last year as well. And some of that, I think, is, you know, it's indicative of the costs of maintaining a certain lifestyle.

26:26And as your wealth grows, you expand your horizons, adapt your lifestyle, whether that's school fees, bigger mortgages, commitments, and often alongside that, people navigating lots of financial responsibilities and complexity. And that's often where sitting down with someone can really help. But again, I think education is so massively important because it builds confidence. And our research shows that when women earn more, they are ambitious and they are equipped to meet those goals. Absolutely.

26:59Laura Watkins:Janice, what was your take, particularly maybe on that education piece as well, of how we kind of build confidence through education, which kind of feeds into the findings in your own data as well, right? I was just about to jump in as well there on how much more it will take before you feel that you have the financial capacity to start investing. I think that what we saw was that women do tend to take more of the day-to-day responsibilities from the family. So the more women earn, the more likely they are to put it in the house or to the children, while men then can see the opportunity to actually start investing.

27:44So I think it comes to educating. I think it comes to no matter what you earn, you can decide on the percentage of your earning to put aside. So may it be 5 % or can it be 10 %? but that can then increase when you earn more. But putting something aside is more important than just waiting for the right moment because then it comes, like Rebecca said, you will need to maintain your lifestyle. So the more you earn, the more you will spend. But if you kind of get that in your mind very early in life, that you should always put aside some percentage of your earning, that will help you massively along the years.

28:31And it can become significant once you reach those 100 ,000 or 200 ,000 and beyond yearly earnings. So yes, education, but we should start very early already from school when we start to talk financials.

28:47Laura Watkins:Yeah, definitely. Building those habits as early as possible. Rebecca, I want to give you the final word on this. What's your take on like kind of how do we get started getting started essentially I think you're making it a little bit more accessible for everyone sort of wherever they are in their financial lives. I think, look, it comes back to I think the representation is massively important. So I make no bones about repeating that. And I think on the education bit, I think there's some really exciting things coming. Things like the advice, guidance, boundary review and targeted support, I think are really, really welcome.

29:20and you know the study showed that women are more likely to seek out guidance and support and advice so it will be really interesting to see whether things like targeted support help to bridge that investment gap outside of that mass affluent space and start to really make a difference so I think look it's going to be really interesting and I think there's lots of positive things happening as well you know around all of the other things that Ruth talked about that you know, absolutely are true.

29:50Laura Watkins:Fantastic. Well, thank you so much. We're going to take a quick pause here. I feel like we've covered a lot of ground in a short space of time, but we will be back very shortly. Hey, folks, David Breer here, CEO of 11FS. Here's something you might not know about me. I get a lot of people trying to impersonate me online, fake profiles, scam emails, the lot. And a big part of that comes from data brokers, hundreds of them quietly collecting and selling your personal information. Your phone number, email, home address, job title, all out there and all fueling identity theft, scam calls and spam. If you've ever searched your own name online, hands up, who hasn't?

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32:05Laura Watkins:Now, a quick break from the headlines to tell you about our next After Dark event, now just over one week away. We'll be recording Fintech Insider News live at London's Village Underground on Tuesday the 17th of March which also happens to be St. Patrick's Day So expect great conversation, lots of fun and maybe a Guinness or two as David Brewer and Ross Gallagher are joined by a fantastic panel of guests to unpick the week's headlines It's free to attend but tickets are going fast So head to 11fs.com forward slash after dart to grab yours now The link is also in the show notes of this episode But back to the news and our next story is Fentech platform Croissant launches with 24 million US dollars in initial funding.

32:49Laura Watkins:A story in the papers. Croissant offers merchants a checkout integration that shows customers a guaranteed resale value at the point of purchase. The idea is simple. Instead of treating a purchase as money gone, Croissant frames it as an asset that can be sold later. Customers can resell items through croissant with one click, while the platform distributes listings across secondhand marketplaces and returns proceeds to the customer. The model is being positioned as an alternative to buy now, pay later, tapping into the growing$130 billion secondhand fashion market. Okay, so what do people think of this one?

33:27Laura Watkins:Ruth, kind of maybe coming to you first with the VC angle. Croissant raised$24 million at launch, which is obviously a very good seed round. What do you think investors are looking at here and backing here in terms of this offering? Yeah, and actually, I have to say, I'm very interested in this space. The first project that I have done out of Citrine, my new fund, is an investment in incubation in a company called Starmoire, which is also in the resale, fashion resale space. So I have been doing a lot of research here and thinking a lot about this. I think that, you know, you're seeing the intersection of a couple of trends and topics.

34:02there's the affordability topic and you know this kind of affordability crisis people feel like they need to make 249 000 pounds to um to feel rich to have enough money yeah to feel rich so here we are there's also uh the the issue of kind of the declining quality of goods so you know what what we're looking at from the project that i'm working on is really people's desire for older things as a way to actually have high quality but i think that the other You know, there's also this other huge environmentalist concern about how the overconsumption of goods impacts the environment. And again, this is a trend that younger people are very interested in.

34:41So the idea that you're not just contributing to this sort of conspicuous consumption and this endless consumption problem, social problem and environmental problem, but actually thinking about how you're going to, you know, how the life of these goods beyond the period during which you need to use them. I definitely think it's kind of spot on. So obviously, due to the investors, it is a quite large seed round. Side point, I would say it does feel very feast or famine in venture capital these days. So companies are either completely unable to raise money or they're raising quite a lot of money.

35:18At least that's the feeling of this kind of bifurcating market that we've been watching really probably since about 2023. It feels like, yeah, there's this really interesting market bifurcation. But I would say on the basis of all of these things, not super surprising. I think that the challenges around the friction of resale and how that works is something that I don't know. For this model, is there this kind of operational complexity? How are you getting the items that you wish to resell into the hands of people who wish to buy them? Is this more of a marketing gimmick? Like, are people actually going to do this?

36:00Is it sort of the kind of warranty story where you just kind of forget about it or you don't ever kind of execute an action it and then it's too late? I'll be very curious to see how it plays out.

36:11Laura Watkins:Yeah, definitely. And kind of to your point, like a lot of the time, you know, when you sell something on, you're doing it on a totally different platform to the one that you bought it on. So the merchant isn't really getting in on that deal. Whether they're doing that here. Yeah, I don't know. I don't know enough other models to know whether they get the benefit, but it will be interesting to see how this one plays out. Denise, what are your thoughts on this? Would that merchant play in mind is Croissant trying to monetize a resale behavior that already exists or is this kind of creating a different kind of merchant revenue stream?

36:46Yeah, let's soon get to that one. My first impression of this was, why didn't I think of this? I mean, honestly, I have been buying maybe a little too expensive shoes or a handbag and come home to my husband and talk about it as an asset rather than shopping. An investment. Exactly. It's an investment. It's an asset that we now have in the household. So in that sense, I think it's a brilliant idea. But then we get to the actual reality of it and overconsumption. And will this just make people buy even more that you actually don't need so will it trigger actually I don't maybe have to have to have a need because I only gonna keep it for maximum of a year so how will it actually impact buying behavior and really interesting to see how it will play out and then the actual business case of it and I haven't seen the products or what's exactly going through that platform yet the revenue stream who is going to cut in where i don't see it yet it's going to be really interesting to follow and to see how they are able to scale this so definitely a change in in behaviors like buying behaviors and as you said will people just forget or if there's a massive boom in a year that everyone wants to actually get that price that they were promised how will that impact the revenue streams of the parties involved in these transactions yeah that's

38:31Laura Watkins:very true and like as you say it could either be an education piece of like do i actually need to buy this or not or the opposite if i buy this now i can still make 75 of it back when i come to sell it in a couple of months in the way that, you know, sometimes people do with games consoles and that sort of thing. They don't lose their value that much. So I'll buy it now and I'll sell it in, you know, a year or something and still regain most of my money. In which case, to your point, that still kind of continues this cycle of fast consumption. So it'll be interesting to kind of see how that plays out.

39:06Laura Watkins:Rebecca, kind of what was your thoughts on this, you know, kind of thinking about the purchases more as an investment or an asset. You know, do you think people are thinking about purchases in this way? Not necessarily in this particular model, but in terms of those like high end value purchases in general? Yeah, I think it's really interesting as a business model, it'll be really interesting to see what happens. I think from an investment perspective, it's not necessarily a new concept. So in the study that we did, you know women in that mass affluent space as an example were just as likely as men to have very diverse portfolios and that included 12 % in things like art and collectibles so I think from a wealth perspective alternative asset classes is not a new concept you know that diversification of portfolios is is really important so you know it'll be interesting to see how this might play into that concept.

40:02Definitely. What's your thoughts on that, Ruth? So the way that I'm thinking about this is really in the context of the work that I'm doing, helping women to understand their closets as an asset and as an asset class. And I think that there's kind of the old trope that men invest in ETFs and bonds and women invest in handbags. And Rebecca, the work that you're doing has shown that that is not true. At least mass affluent women are investing and all of the wonderful things that men are investing in. But I do think that the concept and the notion of turning your closet, which is a very complex, potentially horrifying place and definitely a burden in your home into something which looks a little bit more like a portfolio of assets that you can value and liquidate is really interesting.

40:53And similarly for the other things that you buy, that does seem quite interesting. Again, I am this particular model, and I know from looking at marketplaces for a long time, has the potential to be quite high friction. And I think that what Denise was raising around the business model and sort of, you know, what's the take rate at each step is very, very important to understand. And there has also been quite a lot of backlash because I have been doing a lot of research about this kind of fashion category against some of the resale platforms and the amount of money that you're actually able to recuperate.

41:29So the idea that a good is being valued and a resale price is being guaranteed could be very interesting for consumers, but very risky for the platform. Interesting.

41:39Laura Watkins:Well, yeah, we will have to keep an eye on this one and how it evolves. And, you know, maybe we'll hear from Croissant themselves further down the line. But I'm going to move us on to our final main story this week, which is that Revolut is trying to take on Amex with an ultra-premium business card. A story in Finextra and other places. The card, called Titan, comes with a£65 per user monthly fee and includes perks such as airport lounge access, travel insurance, subscriptions such as The Economist and Perplexity, and even 10 gigabytes of global mobile data each month. Alongside these perks, Revolut says Titan gives finance teams better control over spending with real-time expense tracking, automated receipt matching, and reconciliation tools.

42:25Laura Watkins:The launch comes as Revolut businesses surpasses$1 billion in annualized revenue and becomes the most downloaded business finance app in Europe. So, Denise, maybe let's come to you first on this. What did you think of this one? Is this kind of a natural evolution for Revolut? You know, they've gone premium straight out the gate here. They're no longer sort of playing in the cheap end of the market. What's your take of this one? Yeah, it's a really interesting move because fintechs historically built its reputation on being the cheaper than incumbents. And now we're seeing a fintech move up market.

43:06but if we look at Revolut and what they've been producing over the last decade yes it is a natural step for them and I do think with their user base and how well known they are already if it's anyone that can challenge Amex it is probably Revolut so it's going to be very interesting to continue to see how they succeed with the proposition. It's very high end though, I must say. So let's see how many businesses there are out there that has the need for all of that and are willing to pay for it. But that's their evolution.

43:50Laura Watkins:Yeah, makes sense. Definitely. £65 per user per month for it is steep. In your mind, what kind of makes Amex so hard to compete with historically? Or is it hard or is just no one tried to go as premium as this? What do you think, Denise? I think it's just the long history they have. It takes so much time to build that reputation and to build it globally. so it's just how widely spread it is and the known brand and that they were very unique in the beginning with the perks that they offered it was a b2b card but also a b2c card so again those amex users it's a little like apple then become as well once you go apple you you won't changed and I think Amex had a lot of that earlier that those who were like really committed to using Amex they stayed true to that I don't think the younger generations anymore are that keen to even start using Amex so I in that sense there are room for someone to challenge the space maybe that's such a good point about the sort of like diehard brand loyalty to Amex which has always been built on the kind of rewards and the perks and so on and obviously the name has a huge amount of cut through they're kind of almost like the coca-cola or something of financial services like their american express and mx you know both names uh and so that that reach has a big uh a big cut through but obviously you know increasingly now so does revolute so maybe they can challenge them on that on that great global stage so perhaps coming to you ruth obviously we've talked about that like£65 per user per month as Denise said like fintechs historically targeted the low cost end of the market here we're seeing the complete opposite you know from your your kind of venture perspective uh what's your take on on fintech going up market so to speak I think in this particular case it's completely coherent so there you're gonna see a lot of people um you know opting in for Revolut in Europe because of the foreign exchange advantages.

46:12And they're not going to have a particularly necessarily strong, maybe emotional connection to Amex. And if they do, they're just going to do the math and kind of figure out what the better deal is. I think Amex has also done an incredible job of these like super deep and super broad partnerships. So there's just so much value in the points and people are obsessed with points, obsessed. And I think that this points obsession has actually become less irrational and more rational. And so there's like the people who trust the brand and are loyal to financial services, incumbent financial services brands because of the feeling of trust and stability.

46:51And that's always a challenge for startup competitors. There are also people who are incredibly analytical. And so they're going to see that there's this very coherent value proposition to travelers, people who travel consistently for business. And so you can kind of both manage your expenses and also have these travel perks that are associated with card usage. And of course, what Revolut needs to do, which is the same as any fintech offering a card proposition, is get that card top of wallet, get as many swipes as possible, really try to be the main card of use in general or for a particular activity.

47:31And so this, you know, should definitely allow Revolut to potentially compete on that business user by offering the same type of reward scheme, which has become, which, you know, has become somewhat ubiquitous. And there are also a lot of intermediaries that help and assist with rolling out these types of schemes. So, yeah, like I said, I consider it coherent. I think there's no general rule in venture. Unfortunately, it's always quite diverse. And so each company kind of has to chart its own path. But this seems sensible.

48:04Laura Watkins:What's your take? Obviously, you said people are obsessed with points and loyalty systems and so on. This cloud is starting or launching first in the UK. From your experience, obviously, we've talked extensively on this podcast about how loyalty schemes, rewards is definitely more of a U.S. thing more broadly. But do you think that is becoming more prevalent in other markets beyond the U.S. now as well? I really do. I mean, I've worked internationally for the past 20 years, and I would say that this is that, yeah, loyalty schemes have become fairly ubiquitous thanks to players like American Express, which, you know, again, I think we're doing a lot of talk about sort of people with a very high level of financial literacy.

48:49But those high financial literacy consumers, which are, of course, the most valuable consumers, definitely care about points everywhere.

48:56Laura Watkins:um denise do you kind of concur with that does oh okay interesting tell me more tell me more maybe not actually i just uh at the back end of last year i did an old own podcast episode on loyalty within financial services and the conclusions there were that yes there are some group of people where the loyalty points uh gets uh like obsession but when you dig deeper into it and really look what will people want from financial services the loyalty tends to connect more to services that actually speaks to you so where am I in my life what is my financial institution offering that really connects to me and my need so that it's not the generic portfolio of this is how you earn points, but more where am I in my life and what do I need and how do I create that loyalty to my financial institution.

50:01So maybe I don't see the loyalty points exactly the same way if we look more broadly. For some, yes, but yeah, not sure. Because the price also for the car there is so high And then if we also think that it's a B2B card, like are you really going to pay that per user? And all those benefits included how many institutions actually need them at that cost. And you need to be top of wallet with a premium card, but you are also charging a lot. So, I mean, if they succeed, they are going to make a lot of money on the product that I'm at least sure of. Definitely.

50:46Laura Watkins:Raph, do you want a final word on that? No, I don't think it's necessarily as much of a divergent view, maybe, as presented. I think that we're talking about a very specific, you know, targeted set of young corporate business travelers who, you know, probably are that kind of deep but narrow demographic that Denise is talking about. Exactly. And so, you know, on that basis, I think that it's very consistent. Yeah, true. Fantastic. Awesome. Well, on that note, we're just going to take another quick pause, but very shortly. When you want your spring break to feel like... And your kid's pool day to feel like...

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51:55Laura Watkins:Okay, now for a quick look at a story we don't have time to cover in full, but sticking with a similar theme. Revolut applies for U.S. banking license in a push to crack the American market. the story in the FT, it's official. Revolut has applied for a US national bank charter, a major step in its long-term push to crack the American market. If approved, the license would allow the fintech to offer insured deposits and lending directly instead of relying on partner banks. The move comes as Revolut now serves 70 million customers globally, but still only has around half a million users in the US.

52:30Laura Watkins:Interestingly, this comes before its UK banking license is fully Live and amid signs the US regulator may be more open to fintech entrants. We actually covered this story back in January when rumors were swirling that Revolut might apply for a license rather than shortcut the process by buying a US bank. Here's what my fellow host Benjamin Ansar had to say at the time. Poor old Revolut does seem to come up a lot with license challenges, but it makes sense. It makes sense to get its own license rather than sort of trying to back into an existing license, which may indeed have expectations around branches and so on.

53:07Not that having the odd branch isn't a bad thing, because psychologically, customers seem to be more comfortable depositing money in a place that has a physical presence. But nevertheless, this is an interesting decision, and best of luck to Revolut, that that's a smooth process, because one of the challenges for digital banks expanding into the United States, whether they're American, homegrown, or from overseas like Revolut is the sheer difficulty of getting a charter or a license and the cost and complexity of that process, which in some ways has slowed down the arrival of fully-fledged digital banks into the United States.

53:48Laura Watkins:So, this is definitely a developing story and one we'll be keeping a close eye on in future episodes. But now I'm going to move us on to our and finally. and finally a fun story we picked up on this week which is what industry gets right and wrong about european fintech so the hbo show industry has become something of a cult hit in finance circles following a group of young graduates fighting to survive inside a fictional investment bank or at least that's how the series started it's spiraled since then much of the most recent season even revolves around tender a payments processing fintech that isn't quite what it seems despite impressive payment volumes and big valuations and acquisitions.

54:28Laura Watkins:But a recent piece in Sifted asked an interesting question. What does the show actually get right and wrong about the world of finance and fintech? Because while the drama is often turned up to 11, the show does try to capture some of the realities of the industry from long hours and high pressure to the constant competition for deals, promotions, and survival. So probably a prudent question to ask before we go any further. have any of you seen industry at all? Sorry, I haven't. No, don't watch it. Sorry, Rebecca. So until two months ago, I didn't even own a TV. So no. Wow. That's a journey we might need to unpack.

55:06Laura Watkins:Okay. So shows like industry kind of focus on the intensity and pressure of financial careers. just on a more broader scale. Do we think that that's true or a little bit of a stereotype if you were looking from the outside in a sort of investment banking and so on? Do we think that that's still a representation of the industry? What do you guys think? I think shows like that definitely capture some truths, the pressure, the pace and the competition. But of course, they also tend to focus on the drama. of the things. In reality, I think the industry today is a bit more collaborative, especially in fintech.

55:55So yeah, maybe not as much drama, but captures some truths. Yeah.

56:01Laura Watkins:Do we think we're sort of starting to like shift away from that? We're kind of trying to outgrow that label perhaps, Rebecca? I think certainly from my perspective in the wealth management business. I'm really fascinated about the psychology behind what brings out the best in people and actually having lots of conversations at the moment around recovery to enable peak performance. And, you know, athletes do it. It's a really important part of how they perform at their best. But I think there is long been expectations for people in the finance industry to you know always be on or or that recovery is a bit of a guilty secret so I'm having lots of conversations around actually how do we purposefully bring in recovery so that we can be at our best I think sometimes you know the the idea that you you need to always be on is not always where you get the best from people definitely that's so interesting yeah like recovery is is really important if you're in sports, as you said, but it's rarely applied to the workplace.

57:07Laura Watkins:What do you think, Ruth? Well, from a venture capital perspective, I can say venture capital is absolutely full of shenanigans and I could make a bazillion. You should definitely watch industry. Yeah. Well, I don't have time because I have four children, but and I don't have time to write all of the series of my own life of shenanigans in venture capital, but maybe one day I will. Absolutely. I mean, it's on that theme. Like if you're, so if you're writing a TV show about, about fintech, what are the kind of classic stereotypes of the industry that kind of would make it into the script? So like the, the sort of adages, like we're building a stripe for something.

57:46Laura Watkins:We're trying to get, you know, every startup's claiming to now be AI powered. Like what are the sort of like stereotypes of fintech do we think? I mean, I'm like a loser who hasn't watched the show, but I've like read about the show. And apparently these guys, you know, had some form of unfulfilled career in the industry and then, you know, have found fulfillment in writing this show. So maybe that could be the theme. that's the career gear switch maybe yes I think I think they used to work for Goldman perhaps and then I've written about a fictionalised Goldman bringing some of their experiences to life some with hopefully having watched the show a lot of artistic license at least but yeah do you think there's anyone from FinTech or financial services who you know focusing on them would make a great TV drama as like a biopic.

58:47Laura Watkins:What do you guys think? I think from what Ruth just said, I'd love to see hers. That sounds super exciting. Mine would be incredibly dull. Yeah, Ruth, maybe you're going to have to write your own biopic at some point. Okay, well, I am going to wrap the show there. And we wait with bated breath for Ruth's memoirs so that we can turn them into a TV show. But thank you so much to today's guests. Happy International Women's Day when it comes. And where can people find out a little bit more about you and your companies? Maybe let's start with you, Ruth. Yes. So you can find me on LinkedIn, Ruth Foxblader.

59:21You can follow me on Substack, Fox News. Fantastic. Thank you. Rebecca? You can find out more at hsbc.co.uk forward slash wealth. Wonderful. And Denise? Well, you can find me on LinkedIn, but you can also listen to my podcast in the hot seat. Fantastic.

59:41Laura Watkins:Thank you. And as for me, you can find me, Laura Watkins, on LinkedIn or 11FS.com or on this podcast. And that wraps up today's episode. Thank you so much for listening to today's show. If you like what you heard, please make sure to follow us on your favorite podcast platform of choice. And if you really like what you've heard, why not share the podcast with a colleague or friend? And as always, if you want to join the conversation, find us on social media, just search for 11FS or Fintech Insider and you'll find us or email myself and the team podcasts at 11fs.com. Thanks again and goodbye.

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