Jonah Burian

investor @bcap | alum @penn

[Jonah Burian @jonah_b]

https://t.co/Wi9lJFJcR2

[Jonah Burian @jonah_b]

Neobanks have existed well before stablecoins entered the conversation. For any new entrant today, the key question is not whether stablecoins can replicate existing banking products, but what they unlock that was previously impossible or uneconomical. That bar is getting even higher as incumbent neobanks increasingly adopt stablecoin infrastructure themselves. New entrants need a clear answer to why customers would switch or why they can access net new customers.

[Jonah Burian @jonah_b]

Starting a neobank is now incredibly cheap. With crypto rails, most of the stack comes out of the box for free. That makes CAC the dominant cost driver, and the whole business becomes a game of acquiring customers for less than they’re worth. The way to keep CAC low is to specialize. Teams often start by focusing on a narrow segment, like farmers in one region, young people in high-inflation economies, or expats in Asia, and build features and marketing tailored precisely to them. The result is great for consumers: they get financial experiences designed for exactly who they are.

[Jonah Burian @jonah_b]

@sawinyh Exactly

[Jonah Burian @jonah_b]

These neobanks do not trade at traditional tech multiples in the public markets. Instead, they tend to trade at single-digit, and sometimes low double-digit multiples. That doesn’t mean some of the emerging players aren’t attractive private investments. The public market math simply needs to be factored into the valuation framework and return expectations etc.

[Jonah Burian @jonah_b]

Starting a neobank is now incredibly cheap. With crypto rails, most of the stack comes out of the box for free. That makes CAC the dominant cost driver, and the whole business becomes a game of acquiring customers for less than they’re worth. The way to keep CAC low is to specialize. Teams often start by focusing on a narrow segment, like farmers in one region, young people in high-inflation economies, or expats in Asia, and build features and marketing tailored precisely to them. The result is great for consumers: they get financial experiences designed for exactly who they are.

[Jonah Burian @jonah_b]

@Nomaticcap lower multiples than tech

[Jonah Burian @jonah_b]

@rsproule 💪

[Jonah Burian @jonah_b]

@AndrewCapasso_ Agreed. But that’s different than licenses. Re AML/KYC, at scale neobanks usually get the leverage to renegotiate w providers and drive down the per user price. But yes, the costs are variable not fixed.

[Jonah Burian @jonah_b]

Remember licenses may be expensive, but they’re a fixed cost for the most part. As the customer base grows, that cost is spread across more customers, driving down the effective cost per customer.

[Jonah Burian @jonah_b]

Starting a neobank is now incredibly cheap. With crypto rails, most of the stack comes out of the box for free. That makes CAC the dominant cost driver, and the whole business becomes a game of acquiring customers for less than they’re worth. The way to keep CAC low is to specialize. Teams often start by focusing on a narrow segment, like farmers in one region, young people in high-inflation economies, or expats in Asia, and build features and marketing tailored precisely to them. The result is great for consumers: they get financial experiences designed for exactly who they are.

[Jonah Burian @jonah_b]

It’s an interesting point. And you are not wrong that there are other large cost drivers. We’ve seen that when these neobanks hit sufficient scale, they are able to leverage their dominant position in the stack to renegotiate with their service providers to get more optimal rates.

[Jonah Burian @jonah_b]

Starting a neobank is now incredibly cheap. With crypto rails, most of the stack comes out of the box for free. That makes CAC the dominant cost driver, and the whole business becomes a game of acquiring customers for less than they’re worth. The way to keep CAC low is to specialize. Teams often start by focusing on a narrow segment, like farmers in one region, young people in high-inflation economies, or expats in Asia, and build features and marketing tailored precisely to them. The result is great for consumers: they get financial experiences designed for exactly who they are.

[eric @defyneric]

i predict we’ll see 10,000+ neobanks launch over the next decade, each built for a very specific type of customer.

i’m already seeing neobanks focused only on:

→ dental clinics
→ watch dealers in dubai
→ specific immigrant communities
→ creators
→ truckers
→ ecommerce brands

finance is becoming increasingly verticalized.

the days of building one bank for everyone are slowly coming to an end.

they’ll be tailored specifically to a certain customer demographic and their specific problems.

[Jonah Burian @jonah_b]

@_nonlinear they are one step ahead

[Watcher.Guru @WatcherGuru]

JUST IN: World's biggest YouTuber 'MrBeast' to launch financial services platform.

[Jonah Burian @jonah_b]

@_Ethanoic_ A lot of truth in that

[Jonah Burian @jonah_b]

@Nomaticcap 🫡

[Jonah Burian @jonah_b]

@adelbucetta I’m an investor and care about those things

[Jonah Burian @jonah_b]

As a result, when evaluating new neobanks as potential investments, we spend a lot of time digging into the go-to-market strategy, customer acquisition strategy, target demographic, whether the team has identified a unique/underserved customer segment, unit economics, etc.

[Jonah Burian @jonah_b]

Starting a neobank is now incredibly cheap. With crypto rails, most of the stack comes out of the box for free. That makes CAC the dominant cost driver, and the whole business becomes a game of acquiring customers for less than they’re worth. The way to keep CAC low is to specialize. Teams often start by focusing on a narrow segment, like farmers in one region, young people in high-inflation economies, or expats in Asia, and build features and marketing tailored precisely to them. The result is great for consumers: they get financial experiences designed for exactly who they are.

[Jonah Burian @jonah_b]

@cryptoreine fwiw we’ve met plenty who are profitable

[Jonah Burian @jonah_b]

@blendino 🫡

[Jonah Burian @jonah_b]

@TotalWorldApps Exactly

[Jonah Burian @jonah_b]

@firstc0in 👀

[Jonah Burian @jonah_b]

@defyneric @DrNutcorn FWIW, these are not new strategies. People have been stapling a credit card to a brand (eg airline cards) and running invite-only credit card programs for years.

[Jonah Burian @jonah_b]

@real_philogy That’s a good point

[Jonah Burian @jonah_b]

My cousin in high school told me that her history teacher makes students write all of their homework assignments by hand. In theory, this is supposed to prevent students from using AI to do their work. In practice, though, most students just solve the assignment with AI first and then copy the answers by hand afterward.

I understand the teacher’s motivation. They want students to think for themselves, learn how to research, and actually engage with the material instead of outsourcing the work to a chatbot. But the policy feels misguided because it adds more menial labor without really achieving the intended outcome. Instead of encouraging deeper learning, it turns homework into a transcription exercise.