Product-led API pull in fintech
Charles Birnbaum, partner at Bessemer Venture Partners, on the five waves of fintech
The important signal is that Lithic did not start with a sales thesis, it started with a working card stack that other fintechs already wanted to plug into. Privacy.com forced the team to rebuild old issuer processing infrastructure for its own use, then outside companies began asking for those same APIs to launch virtual cards, payouts, and embedded payment flows. That is the cleanest kind of product pull in fintech infrastructure, because customers adopt the tool before the company fully pivots around selling it.
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This pull came from a concrete pain point. Legacy processors could take months before a customer could even run test transactions, while Lithic emphasized quick API access, self serve onboarding, and modular card controls. That made it useful for startups that needed to ship card products fast, not wait for a heavyweight enterprise process.
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The API was proven in production before it was broadly sold. Privacy.com acted as a large in house user, so every outage, edge case, fraud pattern, and reconciliation problem showed up internally first. That made Lithic battle tested across millions of cards and billions in payment volume before many infrastructure startups would normally have that feedback loop.
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The broader market structure helped the pull turn into a business. All in one BaaS platforms bundled bank partnerships and compliance, but many still used separate issuer processors underneath. Lithic positioned itself as the specialist card layer, more like a narrow powerful tool than a full banking package, which fit customers such as Mercury and other B2B payments products that wanted more control.
Going forward, this kind of pull favors infrastructure companies that begin as their own best customer and then expand outward as more use cases appear. In card issuing, that means the winners are likely to be the platforms that make cards programmable building blocks for software companies, not just outsourced back office plumbing for banks and fintechs.