Here is an example of a personal investment thesis that I created to share with venture capital firms. In this example, I provide my personal perspective on the fintech sector. For details on how I build this thesis check out my blog (https://goo.gl/CU4Qid). Note: Some of the confidential information has been redacted for privacy.

1. Earnest Sweat | 2016
Prospective Venture Capitalist
name@gmail.com
555-555-5555
Exploring the Fintech Industry
Investment Thesis &
Opportunities

2. FINTECH
The Big Idea
The internet has shifted the way individuals view finances & mandatory features for the banking
experience. This trend coupled with rise in user generated data creates a uniqueopportunity for
Fintech solutions that can provide customized products & secure transactions to digital natives.
Virtual banking is driven by
consumers’ expectations & a
digital approach is mandatory for
financial institutions wishing to
compete. Over 60% of all 18-44
year olds use mobile banking & this
trend 24/7 access is expected to
grow. Banks have typically pushed
what they believe customers want.
Advances in data analytics
creates opportunities for
institutions to improve operations by
anticipating customer behavior &
customizing product offerings. Tools
that shift raw data to structured
data—including new types of data–
consumers & businesses could be
advised real-time at point of sale.
Increase in access opens up
data breach risks & this is evident
with over 500M financial records
hacked in 2015. After the financial
crisis, consumers see most value of
banking in transactional trust.
Security & blockchain tools will
become much more valuable to
protect & speed up settlements.
Source: GOBankingRates; PWC; Frost; CityAM.

3. This Thesis is Predicated on 9 Assertions
• The accessibility and power of computing has increased, while cost has declined
thanks to services like Amazon’s AWS.
• Spread of mobile has given rise to large amounts of user-generated data and
security risks.
• This data can be highly revealing to financial health.
• Inefficient financial services can be very expensive to banks, lenders, and
consumers.
• Better data can be utilized to match consumers to more ideal products/services,
leading to better ROI for financial services companies.
• Customized products for consumers are in the fiscal interests of banks, lenders,
and credit unions.
• The infrastructures to deploy such technologies have been established.
• Consumers desire a balance of automated and human interaction for their
services.
• Incumbent financial services firms, are larger, slow-moving companies that are
data deficient and thus vulnerable to disruption.
Therefore, there is a
tremendous investment
opportunity in early-stage
startups addressing needs of
new financial consumer—
providing customized &
secure products.
FINTECH

4. Consumer Preferences are Driving Disruption Opportunity
The emergence of mobile banking
amongst Gen X & Millennials directly
correlates with the mostly likely
disruption targets (consumer banking &
payments)—which suggests the Fintech
sector is at a technological tipping point.
FINTECH

5. Thesis Definition
This thesis defines Fintech as intersections of user-generated data, analytics, specific marketplaces & security
tools that provide consumers access to customized financial products or secure transactions.
Technologies that abide by this definition may be mobile
banking or payments tools, data analytic platforms,
marketplaces, and security solutions that address the fast
paced needs of the digital native consumer. For instance,
Abra has built a mobile P2P transaction platform on top of
blockchain technology. Users can now transfer funds through
their app to another user by only entering a phone number.
FINTECH

6. Consumers are more open to new relationships
that are focused on origination/sales—the
focus of fintech startups—which generates
60% of global banking profits.
Advanced analytics offer transformative
potential to predict “next best actions,”
understand customer needs, & deliver financial
services via new mechanisms ranging from
mobile phones to wearables.
In a world where more than 90% of data has
been created in the last 2 years, fintech data
should lead new products and services,
delivered in new ways.
Data in Banking will Improve Operations & the Consumer Experiences
Source: McKinsey 2015 Global Banking Review.
FINTECH

7. Consumer Preferences Require Advanced Security Tools
Source: Business Insider; Allegis Capital.
Mobile technology has created numerous opportunities
for growth & innovation within the Fintech sector. Many
consumers enjoy signing up for Fintech solutions
because they are easy to use & provide more choice.
But the proliferation Fintech products increase the
chance of risk of data breaches. This calls for an
improvement of authentication, security, & fraud
analysis solutions. This is needed to address the 4x
growth of cyber breaches of the last 5 years.
Banks see the need to address breaches given the
anticipated 37% growth in enterprise mobile
security budgets. Advancements made in machine
learning, analytics, artificial intelligence & blockchain,
has potential to secure the transactional trust banks
need to maintain.
FINTECH

8. Value Proposition
The value proposition of this thesis can be defined by access & actionable analytics, wherein data
offers guidance on customized products, acquisition of customers, & security verification.
As an example, Bee Bank offers
online banking services meant to
replace traditional checking
accounts & help people with low
incomes pay less for costly fee-
driven services.
While Tala offers a smartphone
app for potential borrowers to
download. Tala accesses data
through the app to determine
their credit-worthiness.
Lastly, Trust Stamp creates a
user-initiated, digital identity
complete with a color-coded
Trust Score, which is a fraction
of the cost of a 3rd party
background check.
FINTECH

9. 1. Banks respond to regulatory change
constantly, tying up capital. Customer
expectations are growing exponentially
causing banks to become more efficient at
their business right as it changes.
Investment Conclusion
2. Traditional banks lack the internal
expertise to create tools that leverage data
& speed up settlements; need tools that
suggest optimal products & marketing for
certain market segments.
I believe that the success of fintech startups will be a function
of their analytic capabilities, as opposed to online access to
traditional banking products. Last decade’s unbundling of the
traditional bank has created a crowded Fintech market.
Yet the big data analytics strategies to create optimal
products for specific market segments & cyber verification
tools remain integral, and a function of an impressive
founder’s execution. These factors should be evaluated
thoroughly during due-diligence for early-stage Fintech
startups.
These two conditions (on the right) present a tremendous
opportunity in financial technology.
Key Market Conditions
FINTECH

10. Abra, Bee, Tala, & Trust Stamp
Startups of Interest

11. Significant Achievements & Opportunities: Users can
fund their Abra wallets (through the app) immediately
with their bank accounts, & send money completely free
by just entering a phone number. The startup plans to
use the Series A raise to expand to 20 countries by
2017.
Mobile P2P payments will grow to $174B by 2019 &
30% of P2P volume will be paid via mobile, up from 1%
in 2015.
Abra
Investment Conclusion: This information is sufficient
to prompt informal due-diligence.
Overview: Abra is the world’s first digital cash, peer to peer money
transfer network. Abra Tellers represent a global, shared network of
consumers helping each other easily deposit & withdraw cash.
https://www.goabra.com/
Total Financing: Have raised $14M in total over 3 rounds. The latest was
a $12M Series A, September 2015, led by Arbor Ventures. Investors
include Blockchain Capital, RRE Ventures & First Round Capital.
Traction: Offered in the Philippines and expanded into U.S. in late 2016.
The company generates revenue by charging a .25% fee to a user
whenever they transact with an Abra Teller. Have tellers signed up in 80
countries.
Founder: Bill Barhydt (CEO, Founder, info@goabra.com). Serial
Entrepreneur, Startup Investor, Goldman Sachs. New York Institute of
Finance.
Source: Crunchbase; TechCrunch; Company Website; Business Insiders.
FINTECH

12. Significant Achievements & Opportunities: Provides
accounts that allow customers to access money anytime and
anywhere, use their smartphone to deposit a check, setup a
direct deposit with employer or benefits provider, deposit
cash at many major retailers, pay bills, mail checks & ATM
locations.
Almost 1,900 bank branches closed in the U.S. in the years
after the financial crisis between 2008 & 2013. 93% of the
closures occurred in postal codes that had household
income around or below the U.S. median.
Bee
Investment Conclusion: This information is sufficient to
prompt informal due-diligence.
Overview: Mobile banking solution for urban consumers that
provides low-cost convenient services directly from the mobile
phone. Touch points include stand & truck-based branches.
http://www.beecard.us/
Total Financing: Has raised over $4.6M over 3 rounds. The investing
group includes Blumberg Capital.
Traction: Currently operating in the Greater NYC & San
Francisco/Oakland markets. As of December 2015 Bee had over
3,200 customers (this was before the expansion to the Bay Area).
Founder: Max Gasner (Head of Product, Co-Founder,
xxxxx@gmail.com). Serial Entrepreneur, Data Scientist, Stock Trader,
University of Chicago BA.
Can make personal intro to Co-FounderSource: Crunchbase; Company Website; US Census; Finsmes.
FINTECH

13. Significant Achievements & Opportunities: On
loans that average $50 with an interest rate of
11%, Tala has logged a repayment rate of better
than 90%. The startup is gathering data directly
from its customers rather than working with third
parties, like in the U.S.
There are 2.5 billion people around the world
who are underserved and there’s a $31T unmet
need for credit, according to the World Bank.
Tala
Overview: Tala is an innovative, fast-paced mobile technology start-up, that
provides a credit scoring and reporting platform to financial services
institutions in emerging countries. http://tala.co/
Total Financing: Have raised $11.2M over 3 rounds. The latest round ($10M
Series A in September 2015) was led by Collaborate Fund. Other significant
investors include GV & Data Collective.
Traction: Has loaned almost $20M to more than 150K people. On revenue of
$1.5 million in the 2015, it had a profit of more than $500K. Tala uses user
generated data from their mobile app to determine their Kenyan customer’s
credit worthiness.
Founder: Shivani Siroya (CEO, Founder, xxxx@tala.org). Credit Suisse, United
Nations, Citigroup, Columbia MPH, Wesleyan BA.
Source: Crunchbase; TechCrunch; Forbes; Company Website.
Investment Conclusion: This information is
sufficient to prompt informal due-diligence.
FINTECH

14. Significant Achievements & Opportunities: Uses over 200
public records and social data to provide reliable ID
verification in under one minute for financial advisors or real
estate agents meeting new prospects or clients. Trust Stamp
is a Global Entrepreneur Partner of IBM from whom it has
received $120K of in-kind funding as well as a Microsoft
supported Biz spark Plus startup.
The cyber security market is estimated to grow to $170B by
2020, at a CAGR of 9.8%.
Trust Stamp
Overview: Guards against identity theft & friendly-fraud by providing
a secure digital token & objective trustworthiness score using
patented algorithms & AI resources. http://www.truststamp.us/
Total Financing: Have raised $1.3M in total over 3 rounds. The latest
was a $1.1M Seed, September 2016, led by Second Century
Ventures.
Traction: Currently offered for US Marketplace use as a web
application. Anticipates international, iPhone & Android app
scheduled for early 2017.
Founder: Gareth Genner (COO, Co-Founder, xxxx@gmail.com). Serial
Entrepreneur, Educator & University of London JD.
Source: Crunchbase; TechCrunch, Company Materials, Markets & Markets; Company Website.
Investment Conclusion: This information is sufficient to
prompt informal due-diligence.
Can make personal intro to CEO
FINTECH

15. MyBestBox & OffrBox
Non-Fintech Startups

16. Significant Achievements & Opportunities:
MyBestBox has built their own end to end fulfillment
center (warehouse). Has establish a partnership with
Arianna Huffington that features products that promote
healthy sleeping. The team is currently their data-driven
curation algorithm that will select products.
The current online health & wellness market is valued at
$40B & is expected to grow at a rate of 13% annually
until 2020.
MyBestBox
Overview: A lifestyle brand that helps people jump-start & maintain
healthy lifestyles. The startup assembles boxes with essential, high-
quality products through a platform that leverages machine learning.
http://www.mybestbox.com/
Total Financing: Has secured $130K in pre-seed funding, including
$125K (non-equity stake) from Accelerate Baltimore. Currently raising
their $1M seed round.
Traction: As of September 2016, the startup earned $43K in revenue from
120 subscribers. Have also established 30 brand partnerships including
Uber & Roundstay.
Founder: Fatima Dicko (CEO, Founder, xxxxx@mybestbox.com) Sr.
Engineer on P&G Innovation Team, Columbia Chemical Engineering,
Stanford MBA.
Source: Crunchbase; Company Materials. Company Website.
Investment Conclusion: This information is sufficient
to prompt informal due-diligence.
Can make personal intro to CEO
FINTECH

17. Significant Achievements & Opportunities: Offrbox has
obtained SLAs with numerous conferences, association
influencers, funds & strategic partnerships including the Real
Estate Investment Association & Silver Bay.
The total value of U.S. residential homes equals $28T. There
are 105M homes in the U.S. & 5M are sold each year. There
is a lack of transparency & access during the home
transaction process.
OffrBox
Overview: Platform empowers buyers & sellers of residential
investment properties to search, make offers, and close
transactions in a few clicks. https://offrbox.com/
Total Financing: Have raised $500K in seed capital (July 2016)
from two angel investors.
Traction: Since the beta launch in July 2016, the platform has over
1,400 properties in 43 states with a market value of $50 million
featured. Over 2K users have browsed the site & over 4K are
subscribed to the startup's email list.
Founder: Eric Andrew (CEO, Co-Founder, xxxx@offrbox.com). Real
Estate Professional, Auction.com, Goldman Sachs, & Columbia
BA.
Source: Crunchbase; Company Website.
Investment Conclusion: This information is sufficient to
prompt informal due-diligence.
Can make personal intro to CEO
FINTECH

18. AM Money
Frontier Investment Opportunity

19. Significant Achievements & Opportunities: Recently
participated in the Google for Entrepreneurs accelerator
program.
High-potential, low-income college students have acute
credit needs, but lack access to fairly priced options.
Traditional institutions underestimate long-term value
through transactional engagement because they only
see this market segment value as a few hundred dollars.
AM Money
Overview: Provides users fairly priced financial services & long-term value
when & where other financial institutions won’t. Will operate financial
service centers that offer products designed specifically for younger, lower
income customers with limited exposure to the formal financial system.
Disruptive Potential: More than 2M customers under the age of 35, who
at one point in time, spend approximately $3500 per year on financial
services.
Product Features: Startup offers preventative & remedial products to
serve our customers’ needs. Offerings include saving account that
enables consumer to take out 2x the amount saved in a form of a loan.
Also will over a below market rate emergency loan product. Will eventually
micro-segment consumers through data analytics.
Founder: David Osei (President, Co-Founder, xxxx@A-M.Money)
McKinsey & Co, Michigan JD, Chicago Booth MBA.
Source: Crunchbase; Company Website.
Although it is too nascent a venture to be investable
at the moment, AM Money’s future remains promising.
Can make personal intro to Co-Founder
FINTECH

20. Conclusion
The future of Fintech is at an exciting point. I hope our paths intersect in the
future to build companies that change the way consumers conduct
transactions & settlements for the next 30 years.
LinkedIn
For more context on my academic
and professional experience, please
check out my profile here.
Medium
I have written about my Fintech
investment thesis & provided advice
for founders. Check out
#ReadingEarnest here.
Twitter
I have microblogged & shared
articles on events impacting the
Fintech sector. To stay informed
please follow me here.
FINTECH