Plaid acquired by VISA

5.3 billion acquisition

Visa is buying fintech Plaid (a company that it is now used by an estimated 25% of consumers in US, connecting users to 11,000 financial institutions). Amount of deal: $5.3 billion.

Plaid offers technology that allows consumers to link their bank accounts to its 2,600 fintech clients. Here there are included peer-to-peer (P2P) payments app Venmo, investing platform Acorns as well as stock-trading startup Robinhood. It is one of several players developing back-end infrastructure to enable fintechs to operate.

This deal size is within the rapid industry consolidation: providers look to M&A to avoid competition from upstarts in order to be better prepared for major shifts in the space, and to combat low margins.

Visa and Mastercard are known for high fees they charge for payments to companies for POS (Point Of Sale) devices connected as well as for settlement with banks. Due to kind of large banking network they have, they were kind of monopol.

However, PSD2 is opening the market of payments (at least in EU) to fintechs that can do payments in the name of clients, accessing bank accounts in their name.

The deal of Visa with Plaid is no exception: Visa sees Plaid as a tool that will help it in the next decade by improving fintech relationships and expanding Visa’s addressable market (according to CNBC).

But what’s in it for Plaid? Although they have such a significant traction in US, Visa can boost its operations outside US. Moreover, due to good reputation of Visa throughout banks, financial institutions will be more willing to allow data-sharing with Plaid.

We live interesting times, I keep an eye on these evolutions since PSD2 entered into force and banks (at least in EU) are to allow fintechs to create products for banks clients, accessing bank accounts, balances, transactions, all of these being for the benefit of final consumer.



40 millions EUR investment round for a French mobile app (Lydia)

French startup Lydia is raising a $45 million Series B round (€40 million). Tencent is leading the round.

Payments peer-ro-peer as their main business model now they shifted to a marketplace of financial products, such as borrowing (up to EUR 1000) in seconds, get a free credit when you open a bank account (cool!), home insurance (nice!) and utilities (electricity, gas and internet providers).

Lydia account can be connected to your bank account and debit card. It works with Google Pay, Samsung Pay, Apple Pay.

Looks to me like they are working using PSD2 standard since while ago (in Romania only in December 2019 the PSD2 law started to be in force).


Innovation management: Governing the enterprise IT – (part 1)

How to measure

Left column below shows how an enterprise (a company in general) gains value from innovation, achieve these objectives and then maintains a culture of innovation.

Right column: how to measure what is in the left column

I hope these hints will arm CIO/CTOs with tools that will allow them to consider filtering a few initiatives (existing more ore less in any company) that probably make more noise than they are well-grounded. These will establish a measuring system that will say more about what is to be pursued and what is not to.

What is important

  • to maintain an awareness of information technology and related service trends,
  • identify innovation opportunities,
  • plan how to benefit from innovation in relation to business needs.

First, it may be obvious to start with analysing what opportunities for business innovation or improvement can be created by emerging technologies, services or IT-enabled business innovation, as well as through existing established technologies and by business and IT process innovation.

  • influence strategic planning and enterprise architecture decisions.

What CIO / CTO can do

Except for no.2 that needs IT department’s help, the rest are more or less in the responsiblity of other functions within (any) company.

CIO could pursue the Board to look into no.1, have initiative together with HR (for no.3) and with the Board (and HR) for no.4.

No.5 is again a team work, including the CEO that might need to go systematic and encourage appropriate levels from the entire organisations in approaching customers, suppliers and business partners as to achieve this target of encouraging innovation in relation to third parties.