Uncle Sean's Update - 11/11/22

Happy Friday!!!
 
First and foremost - a HUGE salute to ALL of our past and present service men and women who have donned THE uniform on this Veterans Day!  A day in which we celebrate and honor America's veterans for their patriotism, love of country, and willingness to serve and sacrifice for the common good.  Hey - don’t forget to sign up here to have the Uncle Sean Update delivered straight to your inbox each week!  Here is the Uncle Sean Update for 11/11/22 (lucky numbers by the way):
 

• I am very happy to share this announcement on Veterans Day - MOCA Financial announced the official launch of the Patriot Card today in partnership with the Association of Military Banks of America.  Now live, the Patriot Card gives our Veterans a safe, flexible, and reliable way to receive and spend their government benefits.  Now THAT is cool – Thank you MOCA for taking care of our Veterans all over the world!!!

 

• And here is a bit of good news…  Inflation is finally starting to show some signs (albeit very small) of cooling off!  While still very high, October CPI came in at 7.7% with Core CPI at 6.3% (estimate was 8% YoY and 6.5% for Core CPI YoY; Sep actuals were 8.2% and 6.6% respectively).  I have my fingers crossed that maybe we have passed peak inflation – because it sucks!  LOL!!!

 

• Okay – some Uncle Sean “off the rails” commentary here regarding FTX – so feel free to scroll down 😊.  
  • "I'm sorry... I f*cked up."  - Unless you have been on vacation since last Friday with no access to email, internet, radio, TV, morse code, or smoke signals - you are probably aware of the unprecedented (and completely unexpected) rapid collapse of FTX, the second largest crypto exchange in the World (at least as of last week anyway)…  Ah, leverage (big sigh)….  Always works great when markets are going up….
    • Uncle Sean is trying NOT to spend too much time on this as: 1) it is already being covered widely in the media, 2) still developing as more info comes to light, and 3) there are plenty of opinions already out there.  HOWEVER (see what I did there – LOL), it sure feels as if the crypto industry is having their own Bear Stearns / Lehman Brothers moment as the crypto winter gets even colder.  Ironic, since “modern day” crypto popularity (post financial crisis) was essentially born from distrust of the US financial system and particularly the bigger Wall Street Banks.
      • My question is how in the heck does an exchange, AN EXCHANGE, get $8B+ upside down???  There is plenty of speculation pointing towards the mishandling / cross-collateralization, hyper leveraging, and comingling of consumer assets within FTX and Alameda….  Faced with an unlikely scenario of a “bailout” buyout (since Binance ran for the hills within 24 hours after seeing the FTX Balance Sheet – like a blind date gone bad - LOL), FTX filed for Ch. 11 Bankruptcy early Friday morning.
        • Worth noting that many are pointing towards Binance as the originating catalyst for the FTX “liquidity run” after offloading FTT (FTX’s native token) from their balance sheet following a weekend of public sparring between the two firms.  Reuters has a good article detailing the rocky “relationship” between Binance and FTX.  Hmmmm – the phrase “don’t poke the bear” comes to mind here….  😲
    • And here we go….  Crypto lender BlockFI pauses withdrawals on Thursday citing “lack of clarity” around the FTX meltdown.  Contagion is a term known all too well to those of us “seasoned” finance folks; and it worries pretty much all of us.
      • How do you stop a bank run???  Just don’t allow any withdrawals.  Works like a charm every single time (sarcasm)…..  SMH!!!
    • If finance is built on trust, then this has been a complete shit show since the beginning of the summer.  At best, the crypto industry as a whole comes out of this with a serious reputation problem and a big black eye for all the world to see.  Yes, regs are certainly coming as retail and commercial investors continue to get badly burned over and over and over again – but remember that the vast majority of FTX assets were outside of the US, so meaningful reform could still be a ways out.

 

• TechCruch has a good article detailing Twitter's plan to enter the payments space including Twitter’s filing with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) to conduct money transfers.  That’s a big step and should open some eyes.
  • Musk has hinted to “potentially” moving even further towards bank accounts and debit cards as a way to move cash into Twitter.  All speculation at this point, but there seems to be some legitimacy considering Musk’s past affiliation with x.com to Confinity, and ultimately PayPal.

 

• MeridianLink (NYSE: MLNK) announced the acquisition of OpenClose, a residential mortgage software solution for financial institutions and independent mortgage lenders.

 

• Amazon is launching a merchant cash advance financing program in partnership with Parafin.

 

• Green Dot (NYSE: GDOT; FDIC 22653) new CEO, George Gresham, didn’t waste any time naming new C-Suite appointments (all internal promotions by the way which is VERY cool) including:
  • Chris Ruppel as CRO, Jess Unruh as CFO, and Teresa Watkins as COO – congratulations!

 

• This is intriguing to Uncle Sean, and I’ll get to the “why” in a minute…  But first - Walgreens (Nasdaq: WBA) healthcare subsidiary, VillageMD, inks $9B deal to buy Summit Health and their urgent care clinic chain CityMD.
  • So why is this a big deal…???  Three words – embedded finance opportunity.
    • We all know that the medical care industry is prime territory for embedded finance solutions.  And if you have been following Uncle Sean’s Updates (all the cool kids are doing it), you also know that Walgreens launched Scarlet last year – which is the Walgreens mobile banking app. 
      • Check out this shameless plug!!!!  A quick look at the FedFis FinTech Analytics© database (reach out to Bobby Button for more info) shows that Walgreens Scarlet has a Mastercard Debit Card, Mobile Check Deposit, and Bill Pay already.  Walgreens also has an open loop Mastercard Credit Card with some pretty enticing rewards.
        • I’m not saying they will, but it wouldn’t be much of a stretch to include BNPL / Patient Financing options as an additional value add metric with this new Village MD / CityMD merger.  Cool stuff!!!!

 

• Notable FinTech funding for the week:
  • Archy (payments and dental office mgmt. platform) raised $10M in Series A funding round.
  • Laika (compliance mgmt. platform) raised $50M in Series C round.
  • Doola (business formation including incorporation docs, tax, accounting, and banking) raised $8M in capital.
  • Savvy Wealth (wealth mgmt., tax, and trust startup) raised $11M in Series A-1 $11M in Series A-1 extension.
  • Ping (payment and crypto platform targeting freelancers) raised $15M in Seed round.
  • Brightside (employee benefit / financial care platform for employers) raised $33M in Series B $33M in Series B funding round.
  • Tellus (smart savings app powered by residential RE lending) $26M in capital including a $16M Seed Round and $10M SAFE investment.

 
 
Random Uncle Sean Stuff:

• Congrats to the Houston Astros as the 2022 World Series champions!  At 73 years young, Astros manager Dusty Baker becomes the oldest manager in MLB history to win the World Series.  Congrats, Skipper!  Check out some of these amazing Dusty Baker stats and references:
  • Active member of the United States Marine Corps Reserves as a mechanic in motor transport from 1968 – 1974
  • Is a cancer survivor and speaks fluent Spanish
  • Played 19 years in MLB from 1968 – 1986, Coached MLB from 1988 – 1992, MLB Manager for 25 years thus far from 1993 - Present
  • Was the on deck batter when Hank Aaron hit his historic 715th home run in 1974
  • Widely credited with co-inventing the high 5 with teammate Glenn Burke back in 1977 after hitting his 30th home run of the season
  • Won a World Series as a Dodgers player in 1981
    • And because of all of this, Chuck Norris now tells Dusty Baker jokes!  HELL YES - LOL!!!  😝

 
 
Have a WONDERFUL Veterans Day, a GREAT weekend, and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.