What is the ideal banking stack for a FinTech startup versus a retail/digital brand, and why?

Guest: When you're talking to a startup versus a well-established company, the main differences are the resources and the money that's available to them. In the case of an established company like Nike or another well-known brand, they're going to have plenty of resources to be able to invest and really build the expertise and bring the resources to do the things that maybe in the long run are going to be better for them. I mean, in the long run, you're a program manager or a company that wants to offer financial products better off managing their own relationships with the banks, with the networks and with the processors, because they have more control over that. And it gives them more flexibility in the future if they want to make changes or do things.

And then from a perspective, the revenue is there. They just have a better opportunity for revenue to go directly with these different partners in the case of a FinTech or a startup, because they don't have as many resources. And they're typically smaller companies, fewer employees, they have less money because they it's all investment money. They have to get going as quick as they can for as little as they can. And the trade off there is to basically share the revenue, have someone else do those things like manage the bank relationship, manage the processor, manage the network as well as they don't have to enter into any sort of long-term commitment from an agreement perspective with the processors or the banks. If they're going with a BaaS player. Now, they have to with the actual BaaS provider, but they're able to negotiate that a little bit better. And there's just fewer moving parts. So it's much easier for the smaller company to work directly with the bank.