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Index

Page references followed by f indicate an illustrated figure and t indicate table

Accelerator program, sponsorship Alternative screening methods, 75 (advantages), 58–59 Andreessen, Marc, 233 Accounting ApplePay, development/rollout, challenges, overcoming, 213–218 5, 32 considerations, 202–271 Application programming interfaces models, 203f (APIs), 127 treatment, 213–214 Appraiser qualifications, 238–239 Africa Armstrong, Brian, 97 India, bank account/mobile Artificial intelligence (AI), 127 subscription comparison As-of date, 238 k (percentage), 15f Asset manager, impact, 145 k sub-Saharan African countries, Assets, 205t, 207t mobile banking account asset approach, 165 usage (disparity), 13f customer-related assets, valuation After-tax earnings, 229 process, 211–212 Agency distribution model, Assets under management (AUM), pressure, 124–126 104, 110, 170 AlliancePartners, Personal Capital asset manager percentage, (partnership), 134 171 Allpoint, ATM network, 64 Automated auditing (blockchain), Alltel purchase, 45 96 Ally Financial Inc. purchase, Automated teller machines (ATMs), 114–115, 197 13, 35–38 Alternative lenders, emergence, 75 analysis, 37–38 Alternative lendingCOPYRIGHTEDcosts, MATERIAL 24 funding, 76t network (Allpoint), 64 niche, 70 number, 38t platforms usage, 29, 57 government regulation, 78–79 retail banks, contrast, 75 Balance sheet technology, usage (growth), changes, 208t 74–78 pro forma balance sheet, 206t, Alternative online lenders, 7 209t

253

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254 INDEX

Banco Bilbao Vizcaya Argentaria Bank-sponsored accelerator, (BBVA) participation (advantages), 58 Compass, FutureAdvisor Bank valuation (partnership), 113, 134 approaches, 29–30 deal, 64 FinTech, impact, 29–31 purchase, 62 income approach, 29–30 BankAmericard, problems, 41 market approach, 30 Bank CIOs, survey, 57 Banno (FinTech company), 64–66 Bank Director’s 2015 Growth bankers, analysis, 66 Strategy Survey, 57 corporate events, 65t Bankers, Simple analysis, 62 FinTech entrepreneurs, analysis, Bankomat, ATM usage, 36 66 Banks operation ability, 66 accounts, mobile subscriptions Barclaycash, ATM usage, 36 (comparison), 15f Benchmarking information, acquisition 199–200 assets/liabilities/intangible Betterment, Fidelity (partnership), assets, 205t 134 pro-forma balance sheet, 206t Big Banks, 23–24 advantages, 245 regulations, impact, 26 k balance sheet, changes, 205t Big data, 36, 127 k bank-sponsored FinTech Bitcoin, 92 accelerators, 57–60 funding, 94t customer relationships, 138–139 NYSE entrance, 98 deals payment processing impact, 98 accounting, 204 Wall Street perception, 98 metrics, 187 BlackRock, purchase, 113–114 FinTech Blankfein, Lloyd, 5–6 approach, 134–136 Blockchain, 36 framework, usage, 144–147 applications, 95–96 intersection, increase, 56 automated auditing, 96 partnerships, number characteristics, 92–93 (increase), 57–60 contracts, 95 FinTech company acquisitions, cyber security, 96 192t defining, 92–94 fair value accounting, 215t financial services, 95–96 long-term plan, FinTech function, explanation, 93f partnership (consistency), funding, 94t 154 government regulation, 96–97 partners, FinTech companies immutability, 92 (approach), 136–139 irrevocability, 93 persistence, 244–245 payment solutions, 95

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Index 255

reliability, 92 analysis, 88 technology, impact, 91–99 corporate events, 87t transparency, 92 FinTech strategy, development, Blockchain and Distributed Ledger 88 Technology Conference (2016), flexibility/openness, maintenance, 97 88 Blockcypher, 93 CheckFree Corporation, BMC Software decision, 224 acquisition, 44–45 Book value per share, 197–198 Chubb MDR, ATM usage, 36 Braintree/Venmo Touch, 64 CIF 20/20, 48 Branch networks, cost, 24 Circle, 93 BTC Smart Meters, 95 Citicorp Information Resources, Burn rate, 249–250 purchase, 43 Business divorce, occurrence, 238 Coinbase Business judgment rule, 219 analysis, 98–99 Buy-sell agreements, 234–240 corporate events, 98t example, 239–240 mobile application, usage, 97–99 value standard, 236 Community banks assistance, 31–32 Calahan, Edward A., 38 comparison, 137t k Call Report, 26 FinTech community banks k Cameron, David, 248 comparison, 25t Capital price-to-earnings multiple augmentation, 232 comparison, 31t budgeting, basics, 143–144 FinTech, usage, 53 capital-intensive businesses, asset lending, trends, 74–78 approach, 165 loan portfolio mix, 27f projects, attractiveness, 145f non-interest income, 104 risk-transfer sources, 128 opportunities, 23–28 sources/uses, 144t profitability trends, 23f, 55f Carney, Mark, 59 real estate loan portfolio mix, 28f Cash flow, 142 threats, 21–22 Cashless society, 82–83 Community banks, FinTech CAT bonds, comparison, 128 comparison, 21 CB Insights, 121 threat/opportunity, 21–29 C corporations, shares sale, 232 Consumer lending market, 72–78 Certegy, 46–47 Consumers CFPB credit outstanding, holders regulation plans, 245–246 (ranking), 74t scrutiny, increase, 139 financial service preferences, Check (payment company case 245 study), 83, 86–88 Core Director, 48

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256 INDEX

Core processors, role (evolution), Depository institutions, elements, 60 21 Core vendors, 43–50 Designated Order Turnaround Corporate finance, basics, 139–142 (DOT) system, NYSE creation, Cost of equity (COE), IRR 39 (comparison), 193 Diebold, ATM manufacture, 36 Culture, differences, 186 Digital advisory (FinTech case CU Solutions Inc., acquisition, study) 49 5-year forecast, 169f Customer-related assets, MPEEM valuation conclusion, 172t application, 211 Digital currencies, 91–99 Customers case study, 97–99 acquisition costs, 62 Digital focus, cost saving customer-related assets, valuation (potential), 136t process, 211–212 Digital-focused bank, cost savings, customer-related intangible 25t assets, 210 Digital-only customers, data, 28 demands, meeting, 11 Dilution analysis, 199–200 digital service, 56–60 Discount brokerage industry, insurance providers, relationship evolution, 107 k (disruptor challenge), Discounted cash flow (DCF) k 123–124 method, 29–30, 167–168, 223 primary relationship, Discount rate, 168 maintenance, 153–154 Disruptors, challenges, 123–124 relationships, 138–139, 210–212 Dissenters, rights, 221–224 repeat patronage, importance, Dividend-paying capacity, 223 211 Dividends, payment (absence), 229 retention/preference, 27–28 Djokovic, Novak, 242–243 Cyber security, 96 Docutel, ATM manufacture, 36 Cybersecurity spending, increase, Dorsey, Jack, 83 60 Draper, Tim, 97 Cypress Capital, 181 Early-stage FinTech companies, Daily average revenue trades valuations (DARTs), 108 digital advisory, 5-year forecast, Data analytics, impact (increase), 169f 126–127 example, 169–172 Day traders, 39 planning process, 158–160 Deal metrics, 187 Early-stage FinTech valuation Department of Labor (DOL), issues, 156 Fiduciary Rule mechanics, understanding, (implementation), 105 156

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Index 257

Early-stage investors, 177–183 Expected revenue stream, FinTech attraction, 160 determination, 213 Earn-back period, usage, 199–200 Earnings/cash flow, 29 Factom, 93 Earnings-per-share (EPS) Fair market value, 236–237 accretion/dilution, 201 Fair model value, 204 Earn-outs, 216–217 Fairness opinions, 218–221 Eastern Labs, 59–60 factors, 220 Ebay purchase, 188 Fair value, 222–223, 236 EBITDA margin, Digital Advisory accounting, 215t forecast, 170 measurement, 180 E-commerce, rise, 14 Fair Value Measurement (ASC 820), Efficiency ratios, 24 204 Electronic communication network Federal Deposit Insurance (ECN), launch, 39 Corporation (FDIC) Electronic stock trading, 38–40 community banker meeting, 22 analysis, 40 FinTech opportunities, 14 Employees Insurance on Deposits, 64 benefits, provision, 232 Fidelity, Betterment (partnership), FinTech attraction, 160 134 k Employee stock ownership plans Fidelity Information Services (FIS), k (ESOPs), 230–233 43, 45–47 benefits, 232 Fidelity Investments, founding, Enterprise value, pro-rata portion, 107 238 Fidelity National Financial Episys (platform), 49 purchase, 45 Equity Fidelity National Information cost, 144 Services, 46 incentives, 174–175 Fiduciary Rule (DOL), Equity compensation implementation, 105 409A compliance, 175–177 Finance (change), millennials tax issues, 175–177 (usage), 11 Equity FinTech partners (minority Financial Accounting Standards shareholders), 151t Board (FASB), fair value E*TRADE Financial Corporation, model, 204 trading, 107 Financial advisor, role (change), European Securities and Market 111 Authority (ESMA), paper Financial institutions release, 96 FinTech company acquisitions, Executive leadership, 250–251 192 Expected future cash flows, net income, revenue percentage, forecast, 167 9t

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258 INDEX

Financial returns (assessment full acquisition, 162t process), partnerships (usage), funding trends, 15f 147–149 Google search trends, 4f Financial services, 95–96 growth, option, 28–29 consumer preferences, 245 historical context, 35 technology, impact, 3–4 history, 35–40 Financial technology hype, reasons, 10–12 defining, 3 impact, 29–31 increase, 11 importance, 12–14 Financing round economics, indices, S&P500 (contrast), 16f examination, 178–179 industry, trends/market FinLab (JP Morgan), 59 conditions, 14–18 FINRA initial public offerings (IPOs), Rule 2290, 220 ranking, 235t warnings, 115–116 innovation, increase, 60 FinTech investment analysis, 150f appraiser qualifications, 238 IPOs, 138 balance sheet, changes, 208t legacy systems, usage, 10 bubble lenders, credit cycle, 244 factors, 243–246 leverage, 61 k formation, 242, 246 loan portfolio diversification, 27 k buy-sell agreements, 234–240 necessity, 8 change, inevitability, 28–29 niches, innovation, 90 community banks, comparison, non-interest income, relationship, 21, 25t 24 customer offerings, usage, 27 demands, meeting, 11 payment company case studies, retention/preference, 27–28 83–90 cybersecurity spending, increase, players, identification, 5–10 60 portfolio, 228f deals, accounting considerations, profitability, 8 202–218 public companies, niche defining, 5–10 identification, 6–8 disruptive startups, 86 public company pricing early-stage FinTech valuation multiples, 17f issues, 156 public multiples, median EBITDA efficiency ratios, relationship, 24 margins, 17f enhanced scale, 26–27 regulation, 8, 10 entrepreneurs, analysis, 64, 66 regulatory oversight exits, 188 case studies, 61 failure, case study, 246–251 evolution, 61–66 framework, usage, 144–147 regulatory scrutiny, 139

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Index 259

increase, 245–246 community bank assistance, returns, increase, 16 31–32 search trends, 5t development stages, 162–164 selection process, 238 earnings, 223 strategy financial institution acquisitions, development, 88 192 returns, consideration, 145f holding on, 229–230 threat/opportunity, 21–29 income approach, 167–168 transactions (analysis), metrics initial public offerings (IPOs), (usage), 192–202 233–234 trending exits, 18f intangible assets, 162 unicorns, 16 intellectual property, 162 U.S. financial institutions, investment returns, 140t relationship, 8–10 management team, 162 valuations market approach, 165–166 increase, 16 market characteristics/impact, preferences, 172–173 161–162 venture capital investments, partnering, 133 valuation pricing multiples example, 180–181 median EBITDA margins, 247f k process, 178f median enterprise k venture capital (VC) investors, value/EBITDA multiples, exit, 88 247f Visa/Mastercard, initial public regulatory environment offerings, 40–43 assessment, 164 FinTech acquisitions regulatory overlay, 164 analysis, 150f risk/growth, trade-offs, 164–165 assets/liabilities/intangible assets, risk profile, bank comfort, 153 207t Section 409A, application, 176 post-close success, incentives selling in, 230–233 (alignment), 214 selling out, 233–234 pro forma balance sheet, 209t valuation FinTech banks approaches, 165–168 benefit, 149 considerations, 160–172 intersection, increase, 56 value stages, 163t FinTech companies FinTech mergers and acquisitions acquirers, identification, 191 (FinTech M&A) acquisition, 185, 191t activity approach, 136–138 comparisons, 167t asset approach, 165 trends, 187–192 bank acquisitions, 192t exits, 189t–190t bank advantages, 245 issues, consideration, 218–224

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260 INDEX

FinTech mergers and acquisitions Full credit cycle, experience, 244 (FinTech M&A) Full-service broker, support (Continued) (absence), 106 overview, 18f, 188f Funding, access (improvement), volume/pricing, 187, 188f 138 FinTech partners Funds, accessibility (increase), 75 analysis, 150f FutureAdvisor (Future Advisor) investment, 149–152 BlackRock acquisition, 112, FinTech partnerships 113–114 banks RBC/BBVA Compass/LPL, approach, 134–136 partnerships, 134 long-term plan, consistency, Future cash flows, forecast, 167 154 capital budgeting, basics, Generally accepted accounting 143–144 principles (GAAP), 160, 218, corporate finance, basics, 237 139–142 Global population, customers, primary relationship unbanked/underbanked (maintenance), 153–154 characteristic, 11 example, 148t Goldstein, Rob, 113 k financial returns, assessment Good Technology, 173 k process, 147–152 Goodwill framework, development, creation, 185–186, 202–217 139–147 defining, 203 importance, 90 Gordon Growth model, 168 internal rate of return analysis, GPR prepaid/debit/payroll cards, 147, 149 provision, 210 investment returns, 139–142 Graham, Benjamin, 203 IRR/ROE spread, 149 Great Recession, aftermath, 35, 70 questions, 152–154 Grip (mobile banking tool), 65 regulatory reaction, 153 Growth, 29 ROE spread, comparison, 152t influences, 143 transactions, hurdle rates, 146f Growth Strategy Survey (2015), 61 valuation, basics, 142–143 Guideline company analysis, First Data Processing, 43 summary, 32t First Internet Bancorp (IBNK), 6 Gyft (payment company case First National Bank, 59–60 study), 83, 84–86 FiServ Inc., 43–45 analysis, 84–86 IPO, occurrence, 43 consumer/retailer adoption, Fixed-rate brokerage commissions, growth, 86 abolishment, 106 consumer value, 85 Flowers, J. Christopher, 244 corporate events, 85t

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Index 261

differentiation, 86 Insurance retailer value, 85 agency distribution model, target, 84 pressure, 124–126 data analytics, impact (increase), Hackathon, hosting, 59–60 126–127 Hall, Jerry, 48 future, 120 Harms, Travis, 172 providers Henry, Jack, 48 customer relationships, Hewlett Packard, involvement, 188 disruptor challenges, Hock, Dee, 41 123–124 Holding in, 229–230 InsurTech disruptors, Holistic financial life management, challenge, 127–128 111 technology trends, 123–128 Hometown Community Bank, Insurance-linked securities (ILSs), acquisition, 198 128 Honest Dollar, Goldman Sachs InsurTech, 120 acquisition, 111–112 competitors, 120 Horizontal applications, impact, 95 disruptors, impact, 127–128 Housing market, collapse, 70–71 financing trend, 122f Hunt, Bob, 46 introduction, 121–123 k Hurdle rates, 146f Intangible assets, 162 k identification, 205t, 207t Intellectual property, 162 ICE/Interactive Data, 188 Interim cash flows, 170 IFRS standards, 160 Internal rate of return (IRR), 141 Incentive stock options (ISOs), 174 analysis, 147, 149 Income approach, 167–168, 223 COE, comparison, 193 Indepdendent ATM deployers determination, 150 (IADs), creation, 37 impact, 146 India/Africa, bank account/mobile spread, 149t subscription comparison Internal Revenue Service (IRS) (percentage), 15f Revenue Ruling 59–60, 177 Industry experts, 238–239 Internet of Things (IoT) Information Technology Inc. (ITI), potential, 127 acquisition, 44 spending, 126 Initial public offerings (IPOs), 18, Interpretation of Financial 40–43, 233–234 Statements, The (Graham), 203 markets, impact, 246 Investment returns, 140t ranking, 235t basics, 139–142 Innovation core processes, role (evolution), Jack Henry & Associates, 43, 46, 60 48–49, 64 increase, 60 James, Raymond, 112

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262 INDEX

Jemstep, Invesco acquisition, Madden v. Midland Funding, 246 111 Management structure, impact, JH Banking, evolution, 48–49 250–251 JP Morgan Margins, examination, 170 FinLab, 59 Market Motif, partnership, 134 approach, 165–166, 223–224 data, derivation, 166 Kernel (system), 65, 66 metrics, usage, 166 KKR/First Data, 188 public market information, multiples/margins, 166t Legacy systems, usage, 10, 24 volatility, impact, 108 Legacy technology systems, Mastercard company reliance, 10 examples, 43 Lenders, credit cycle, 244 growth drivers, 42 Lending initial public offering, 40–43 alternative lending, impact, McFarlane, John, 173 74–78 McKelvey, Jim, 83 leveraging technology, impact, Median community bank 74–78 ROA/ROE, 54 trends, 74–78 Median EBITDA margins, 17f, 247f k Lending Club, 74, 78 Median enterprise value/EBITDA k founding, 76–77 multiples, 17f, 247f Leveraging technology, usage Mercer Capital, 234 (growth), 74–78 Mergers and acquisition (M&A), Lewis, Michael, 233 107–108 Liabilities, 205t, 207t activity, 123, 156, 222 Line call, 220 trends, 187–192 Linq (NASDAQ), 95 exits, 189t–190t Liquidity overview, 18f, 188f options, 227–234, 229t Merrill Edge, 107 provision, 231–232 Metavante Technologies Inc., Live Oak Bancshares (LOB), 6 46–47 Loan portfolio diversification, 27 Microinsurance, expansion, 125 addition, 142 Microsoft Money, 244–245 Long-term shareholder value, Minority shareholders, 151t creation, 232 Mobile banking account usage, Loyalty programs, retailer-specific disparity, 13f mobile payment apps Mobile money, rise, 14 (relationship), 90–91 Mobile subscription, bank accounts LPL, FutureAdvisor (partnership), (comparison), 15f 113, 134 Montonaro, Don, 115, 197 Lu, Bo, 113 Morais, Diane, 115, 197

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Index 263

Mortgage Options, forms, 174 banking, cyclicality, 72 OSI, 46 market, 70–72 Over-the-counter (OTC) market, originators, ranking, 71t, 73t NASDAQ creation, 39 Motif, JP Morgan (partnership), 134 Partners MPayMe acquisition, 249–251 equity FinTech partners, 151t Multiperiod excess earnings method FinTech companies, approach, (MPEEM), 211 136–138 FinTech partners, investment, NASDAQ 149–152 Linq, 95 Partnerships Private Market, 95 financial returns, assessment NASDAQ, NASD creation, 39 process, 147–148 National BankAmericard Inc., 41 importance, 90 Net interest income trends, 55f Net interest margins (NIMs), options, 150 55–56 size, importance, 64 Netscape, IPO, 233–234 strengths, 66 NetSpend voting stock acquisition, usage, 147–149 Payment processing, Bitcoin impact, k 210 k New New Thing, The (Lewis), 233 98 New York Stock Exchange (NYSE) Payments niche (public FinTech automation, 39–40 company niche), 6, 82 FIS trading, 46 trends, 82–99 Non-compete agreements, 217–218 PayPal Non-interest income, 24 EBay acquisition, 188 Nonqualified options, 174 FinTech application, 22 Norcross, Gary, 46 Peer-to-peer (P2P) advent, 128 Peer-to-peer (P2P) insurance OnDeck, 74, 78 networks, 123–124 IPO/stock price decline, 77 Peer-to-peer (P2P) lenders, 75 Online brokerage industry, Peer-to-peer (P2P) lending models, evolution, 106–108 75 Online Broker niche, public trading, Peer-to-peer (P2P) money-transfer 7 service, 83 Online brokers, 7 Peer-to-peer (P2P) payments, Open Solutions, 46 sending, 22 “Opportunities and Challenges in Performance metrics, 214 Online Marketplace Lending” Personal Capital, AlliancePartners (DOT), 78–79 (partnership), 134 Option pricing method (OPM), Point-of-sale (POS) segment, 83 inputs (calibration), 179 Porcelli, Frank, 113

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264 INDEX

Post-acquisition risk, sharing, 216 Purchase agreements, non-compete Post-close success, incentives agreements, 217–218 (alignment), 214 Powa Technologies QR code (barcode), 91 analysis, 249–251 Quick Response (QR) codes, usage, burn rate, 249–250 248 case study, 248–249 executive leadership/management RBC, FutureAdvisor (partnership), structure, problem, 250–251 113, 134 history, 248–249 Reasonableness, tests, 180 product, problems, 251 Reconciliation, 180 Price-to-earnings multiples, Registered investment advisors comparison, 31t (RIAs), 104, 107, 112 Price-to-earnings ranges, 137t market share, 169 Private Market (NASDAQ), 95 usage, 145 Private markets, IPO markets Regulatory oversight, evolution, (impact), 246 61–66 Probability-weighted expected Regulatory technology (RegTech) return method (PWERM) focus, 26 analysis opportunity, 24, 26 k scenarios, 181t Relay product (Stripe), impact, k synthesis, 182t 89–90 Probability-weighted expected Restricted stock, equity incentives, return method (PWERM), 174–175 inputs (calibration), 179 Retail banks, alternative lending Probability-weighted stream, 214 platforms (contrast), 75 Processors, usage, 6 Retailer-specific mobile payment Profit Stars (ProfitStars), 48–49 apps, loyalty programs Pro forma (pro-forma) balance (relationship), 90–91 sheet, 206t, 209t Retention bonuses, option, 217 Pro forma (pro-forma) capital Return on assets (ROA), increase, ratios, 208–209 23, 136 Property and casualty (P&C) Return on equity (ROE) commissions/brokerage fees, 124 increase, 136, 147 losses, 128 median, 23 P/TBV multiples, 200 spread, 149t comparison, 209 FinTech partnership, Public FinTech companies, niche comparison, 152t categorization, 6–7 Return on investment (ROI), 194 Public market information, Returns multiples/margins, 166t comparison, 159f Public returns, comparison, 16f internal rate, analysis, 147, 149

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Index 265

ribbit.me, 93 bankers, analysis, 62 RICO lawsuits, 246 corporate events, 63t Ripple, 94 Small Business Credit Survey, Risk, 29 245 consideration, 143 Small Business Credit Survey absence, 153 (2015), 139 growth, trade-offs, 164–165 Small Business Credit Survey perception, 186–187 (Federal Reserve), 54 profile, bank comfort, 153 Small-order execution system Robo-advisors (SOES), NASDAQ appearance, 108–116 enlargement, 39 success, reasons, 109 Smith v. Van Gorkom, 219 Robo-advisory Social broker, impact, 125 advisory, 105–106 Software/hardware companies, 6 A.T. Kearney estimate, 170 Solutions niche (public FinTech effects, 111 company niche), 7 position, 111–113 Square (payment company case regulatory environment, study), 83–84 115–116 Stakeholders services, metrics (comparisons), FinTech attraction, 160 k 110t valuations, 173–183 k Standard & Poor’s 500 (S&P500), Sale, liquidity options, 227 FinTech indices (public returns Schwab Bank, chartering, 107 comparison), 16f Section 409A Starbucks, application, 90–91 application, 176 Stock compliance, 175–177 fair market value, valuation consequences, 176 process, 176–177 Self-service, 36 options, equity incentives, 174 Selling in, 230–233 prices, communication, 38–39 Sell-now versus sell-later analysis, purchases, facilitation, 231–232 performing, 221 Stock appreciation rights (SARs), Shareholders 176 dissenters, rights, 221–224 equity incentives, 175 long-term shareholder value, Stock Market Crash (1929), 39 creation, 232 Stripe (payment company case Share repurchases, 230 study), 83, 88–90 Shocard, 93 analysis, 89–90 Sidecars, 128 buy buttons, building, 90 SigFig, UBS (partnership), 112, 134 corporate events, 89t SilverLake System, 48 payments space, incumbents, 89 Simple (FinTech company), 62–64 Relay product, impact, 89–90

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266 INDEX

Sub-Saharan Africa Total System Services (TSYS), FinTech, impact, 12 NetSpend voting stock mobile banking account usage, acquisition, 210 disparity, 13f TowerGroup, 46 mobile money/e-commerce, rise, TradeKing, Ally acquisition, 112, 14 114–115, 197 Subsidiaries, spinout/spinoff, 230 Trademarks, 212 SunGard, acquisition, 46, 47 expected revenue stream, Sunshine State Systems, 43 determination, 213 SuperDOT, usage, 39 future use, determination, 213 Symitar Systems, Inc., 48–49 Tradenames, 212–213 Systematics, acquisition, 45 valuation process, 212–213 Transactions Tangible-equity-to-asset ratio, analysis, metrics (usage), 204 192–202 Targeted dividend payouts, 229 considerations, 216 TBV accretion, 199–200 hurdle rates, 146f TBV accretion/dilution analysis, TxVia, 64 200 TD Ameritrade Holding UBS, SigFig (partnership), 134 k Corporation, founding, 107 Underwriting, 75 k Technology Unicorns, 16 blockchain technology, impact, United States 91–99 banks, overview, 22f, 54f impact, 3–4 community banks, industry leveraging technology, impact, trends, 53–56 74–78 financial institutions, FinTech niche (public FinTech company (relationship), 8–10 niche), 7 gross domestic product (GDP), regulatory technology, value (addition), 9t opportunity, 24, 26 robo-advisory regulatory Telebanc Financial Corporation environment, 115–116 acquisition, 107 Upper-middle-income countries, Tennis junior/professional rankings, mobile banking account usage 243t (disparity), 13f Tennis Tech (TenTech), 4 UPS Pulse of the Online Shopper Terminal value, 167–168, 170 survey, 82–83 calculation, 171t reasonableness, test, 171t Valuation Thrifts, overview, 54f approaches, 165–168 Tickertape, stock price telegraphs, as-of date, 236 invention, 38–39 asset approach, 165

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Index 267

basics, 142–143 process, 178f experts, 238–239 investors, exit, 88 gap, addressing, 214, 216 Visa income approach, 167–168 debit cards/payments, indications, synthesis, 168 64 inputs, measurement date examples, 43 adjustment, 179–180 initial public offering, 40–43 market approach, 165–166 structuring, 42 metrics, usage, 165–166 total returns, 41f performance, reasons, Visa International, 41 157–160 Volcker, Paul, 36, 243 ranges, 137t Value Wagner, Dan, 248 creation, 149 Walmart Pay, 91 measurement process, Wealth management 157–158 democratization, 111 equation, 142 FinTech innovation, 105 gaps, 186–187 niche, 104 levels, 237f Wealth Management Americas stages, 163t (UBS), 112 k standard, 237 Wealth managers, market share, k Value Creation Scorecard, 201t, 169 202 Wetzel, David, 36 Value per share, change, 159t Willis Group/Towers MOE, 188 Venmo (FinTech application), 22 Venture-backed companies, Xerox, involvement, 188 valuation process (challenge), Xu, Jon, 113 173 Venture capital (VC) Yabuki, Jeff, 44 funds, 64 interest, 64 Zero-interest rate policy (ZIRP) investments, valuation, 177 cessation, 56 example, 180–181 impact, 108

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