Open Banking and Financial Management Trend by Aman Behzad.
Infographic explaining the impact of Open Banking and Wealth Management, featuring insights by Aman Behzad

Mergers, Acquisitions, and the Overall Fintech Market with Aman Behzad of Royal Park Partners

Episode Overview

Episode Topic:

Welcome to an insightful episode of PayPod. We invent the rapidly evolving world of Open Banking and Financial Management, with Aman Behzad, founder and managing partner at Royal Park Partners. As fintech continues to evolve, Open Banking has emerged as a pivotal force, driving innovation and accessibility in wealth management practices. This episode offers a deep dive into the mechanics of Open Banking, its implications for wealth management, and how it fosters a more inclusive and efficient financial ecosystem.

Lessons You’ll Learn:

This episode is packed with valuable insights on the integration of Open Banking and Financial Management. Listeners will learn about the revolutionary impact of Open Banking on wealth management, including enhanced client experiences, personalized financial advice, and improved accessibility to financial services. Discover how Open Banking is setting new standards for transparency and security in wealth management, and why it represents a significant opportunity for both consumers and financial institutions. From strategic implications to technological advancements, this episode is an essential listen for anyone keen to understand the future of finance.

About Our Guest:

Aman Behzad, the founder and managing partner at Royal Park Partners, is our esteemed guest, bringing unparalleled expertise in fintech, Open Banking, and Financial Management. With an illustrious career spanning several years, Aman has been at the forefront of financial innovation, advising numerous fintech teams on capital raising, M&A transactions, and growth strategies. His insights into Open Banking and Financial Management are grounded in extensive experience and a deep understanding of the fintech sector. Aman’s vision and leadership have positioned Royal Park Partners as a key player in shaping the future of financial services.

Topics Covered:

This episode covers a broad spectrum of topics related to Open Banking and Financial Management, offering listeners a comprehensive overview of this dynamic field. We explore the regulatory landscape of Open Banking, its impact on traditional and digital-first wealth management firms, and the technological innovations driving change in the industry. Aman Behzad shares his expert perspective on the challenges and opportunities presented by Open Banking in wealth management, including client data management, customized investment solutions, and the role of AI and machine learning in personal finance. Join us as we navigate the complexities of Open Banking and Financial Management, uncovering the strategies that will define the future of financial services.

Our Guest: Aman Behzad- Driving Financial Inclusion with Open Banking and Financial Management

Aman Behzad is a visionary leader in the fintech industry, known for his pioneering work in integrating open banking and financial management. As the Founder and Managing Partner of Royal Park Partners, Aman has successfully positioned the firm at the forefront of financial technology advisory services. His journey in the finance sector is a testament to his commitment to innovation and excellence. After graduating from university, Aman sought a path less traveled, venturing into the fintech landscape rather than the traditional finance roles in the City of London. This decision led him to an internship with a New York-based boutique investment bank and fintech business, where he gained invaluable insights into the complexities of deal settlements and the emerging markets of Southeast Asia.

In his early career, Aman’s exposure to the inefficiencies in traditional financial transactions fueled his interest in fintech solutions. Recognizing the potential of fintech to revolutionize financial services, he returned to the UK to further his expertise, eventually transitioning to investment banking with Citigroup. At Citigroup, Aman specialized in the TMT and financial services advisory, focusing on emerging markets where his unique linguistic capabilities and experience offered significant value. It was during this time that Aman identified a niche in advising fintech businesses, sparked by the realization of the scarce understanding of fintech and payments within the banking sector. This insight led to his involvement in significant transactions, such as the spin-out of Network International, which further solidified his passion for the fintech industry.

Aman’s entrepreneurial spirit and deep domain knowledge in fintech led him to establish Royal Park Partners in 2019, a corporate finance advisory firm dedicated to serving the fintech sector. Under his leadership, Royal Park Partners has flourished, advising on numerous transactions and expanding its global footprint with offices in London and New York. Aman’s expertise in open banking and Financial management has not only contributed to the firm’s success but has also played a pivotal role in shaping the future of financial services. His commitment to high-quality service, combined with his comprehensive understanding of the fintech landscape, has made Aman Behzad a respected figure in the industry. Through Royal Park Partners, he continues to empower fintech teams, enabling them to navigate the complexities of capital raising and mergers and acquisitions, while fostering growth and innovation in the financial sector.

Episode Transcript

Aman Behzad: I think during the course of this year, revenue growth would probably be valued two times more than profitability, but companies will still need to be profitable. We very much reached an equilibrium of buyer and seller expectations, both on the M&A and on the capital raising side, so deals should be getting done. The one roadblock to deals getting done in significant numbers is the inertia that exists within, particularly a lot of the private companies around very complicated shareholder structures that they’ve had to adopt over the last couple of years in terms of, firstly, very high multiples before in pricing and then secondly, emergency funding that they’ve taken on over the last couple of years, and how that unwinds itself in a more normalized valuation environment that I think is the final sacred cow to be slaughtered, which will open up the dams of all of this capital that’s out there. We’ve got something like $600 billion of venture capital money that needs to be deployed, dry powder that’s sitting out there, that needs to be put to work.

Jacob Hollabaugh: Welcome to PayPod, the payments industry podcast. Each week, we’ll bring you in-depth conversations with leaders who are shaping the payments and fintech world, from payment processing to risk management, and from new technology to entirely new payment types. If you want to know what’s happening in the world of fintech and payments, you’re in the right place. Hello, everyone. Welcome to PayPod. I’m your host, Jacob Hollabaugh, and today is going to be a very fun show. We’re going to be diving into the world of fintech mergers and acquisitions, how to value fintech companies in today’s landscape, what makes for a great long-term outlook in this industry, and a whole bunch more. As always, I’ve got an expert with me to talk us through some of these topics. I’m very pleased to be joined today by Aman Behzad, founder and managing Partner at Royal Park Partners, the corporate finance advisors helping outstanding fintech teams tell their stories to investors and create platforms for growth. Aman, welcome to the show. Thank you so much for joining me today.

Aman Behzad: Hey Jacob, thanks for having me.

Jacob Hollabaugh: The pleasure is mine. So let’s kick things off with a little bit of background. Fill me and the listeners on some of your background, if you would, and how it was that you came to see both the world of mergers and acquisitions and specifically the fintech industry as the place you wanted to specialize and operate in.

Aman Behzad: It’s not necessarily a clean story. I graduated from university, wanted to do something a bit different with my career, instead of going to work in the City of London, and decided to take up an internship with a New York-based boutique investment bank slash fintech business actually called Marco Polo Partners/Marco Polo Networks. They were focused on providing deal settlement platforms for trading that was happening between banks and some of the emerging market indices, like India and further in Southeast Asia. That time when you were to place it, this is sort of circa 2003, if you were to place a trade and try and buy equities in India, the settlement period would be 25, 30 days. You wouldn’t know what price it traded at when it happened, how it happened, and you just get some kind of notification at the back end to say that that it happened, if indeed it did, and roughly what price you ended up paying. So that was pretty interesting. I didn’t connect the dots at the time, but found that interesting. I came back to the UK after being there for about nine months, got a bit homesick, and worked, and trained as a chartered accountant. I felt the calling of investment banking again, went and joined Citigroup, firstly, working in their aligned between sort of the TMT team and the financial services advisory team, but usually covering emerging markets slides, which is where I had some linguistic capabilities and some experience, which brought me towards the end of my time at Citigroup, where I started working on the spin out of a company called Network International, which was listed and then subsequently taken private by Brookfield, most recently on the spin out from the bank that owned them, which was Emirates NBD Bank when that transaction was happening.

Aman Behzad: What was interesting was that there was nobody in the bank who knew, other than one person sitting in New York, how to value or look at these businesses. The managing director who was sitting in New York was working on the other big transaction that was happening, which was the Worldpay spin-out from the Royal Bank of Scotland at the time, RBS. It was very clear to me that there was a dearth of and this bank of around half a million employees, there were 2 or 3 people who understood what fintech or payments was. So at that point, there’s sort of a light bulb moment that went off that said, this is great. Diversified financial services, as it was known then, is an area that’s not well covered, people don’t get it. I could call out quite a nice little career for myself, doing and advising these kinds of businesses that are part of the glue of the economy, part of the glue of our everyday interactions, realized being at a big bank was not the place to do it, just because there’s no focus. So at that time, there was a really interesting boutique investment bank called Armor Partners that was just gathering steam and looking to set up a fintech-focused advisory firm based on best-of-breed execution, a bunch of ex-Goldman Sachs and Lehman Brothers bankers banding together to cover tech and then fintech specifically where I was being called to support them on. I haven’t looked back since. It’s been I like to say that I’ve done more fintech deals in Europe than any other banker and certainly got too many of the war wounds and scars to prove it.

Jacob Hollabaugh: It’s amazing to hear, how big of an opportunity there was there because it comes up in lots of different ways and different conversations on this show about different parts of the financial world, but there was even a disconnect between the payments world and the fintech world being so disconnected from the rest of the financial world and everything. That sounds backward to us now. But that really was the reality through the 2000 and into the 2010. It took stepping out, it was also a common refrain we’d heard of I had to leave, the bank wasn’t the best place to do this thing, that I saw, that I wanted to do. Eventually, maybe I’ll come back around and work with them in some capacity, but it wasn’t from the inside that was going to work. Then what year was it that Royal Park Partners came about? Can you give us a high-level overview now, today, who you are, what the service offering is, and who you’re typically working with?

Aman Behzad: Sure. Again, I had a bit of another light bulb moment in terms of providing senior-level execution, high-quality service, and really deep domain fintech knowledge initially in Europe, which was the calling for why I set up the firm. That was 2019, mid-2019, and September 2019 is when we officially launched. So it’s coming up to our fifth anniversary. What would have been, what, six months before the first COVID lockdowns happened? So that was a bit of a roller coaster time to set up a business, but I’m very happy to go into some more of the interesting stories that happen in and around COVID. But the firm itself has now completed 45 transactions. We’ve got two offices, London and New York, and about 20 people between those two offices. We’ve done deals as far east as Indonesia and as far west as Chile. So a real global mandate in terms of the nature of our coverage. And for us, from day one, we wanted to be global. We wanted to take the best of our learnings from all of the different regions in the world and apply them to other regions, provide cross connectivity between acquirers and investors in different parts of the world to other parts of the world, and be a properly functioning, boutique corporate finance advisory house, you have to be global.

Jacob Hollabaugh: Absolutely, and especially with the fintech industry, is in its real global ascension in some ways where we’ve slowly but surely built things in different local markets that have proven to have worked well, and now it feels like the dissemination across like let’s all match the best of all the different markets and all the different places and do this globally. Obviously, with the economy being where it is now on such a global scale, it all wraps up and makes sense. It’s been fascinating over the last year, especially on this show. We’ve talked to a lot of folks who started the company right before COVID and then had to live through that. And what a wild ride that would be for any business owner in general. But for someone who starts right going into that, you’ve gone through some pretty wild market conditions, some pretty big fluctuations up, down, left, right, and center. Let’s look at current market conditions today. Not that there’s ever a perfectly calm financial market out there, but as we said last handful of years have been big swings, and have been more choppy waters than we’ve experienced in quite a while. Where do you feel the fintech market is right now on the valuation front specifically? Have we reached an equilibrium again of somewhat fair evaluations? There was a period during there when we were way overvaluing fintech companies, potentially, there’s a period where we were undervaluing companies. Where’s the market right now?

Aman Behzad: Sure. Just to double-click on that, firstly, we support companies on capital raising and M&A transactions. The hallmark of the period from 2019 through to 2021 was capital raising heavy because there was so much money in the market. Valuations were extremely frothy. You were able to take very large sums of money as a founder, both in terms of going darkly into your pocket in terms of secondary sales, but also in terms of capital to turbocharge your business. The combination of those two made it a bit of a no-brainer to just carry on going. Why would you even consider selling your business to anybody else? We saw that tide turn dramatically in 2022 when we saw the fallout over the VC winter starting to set in. Just to recap a little bit about that BC winter, just so people understand the magnitude of it, obviously record funding into VC companies, but in Q4 of 2021, $1 out of every $4 was going into a fintech business. That’s a gargantuan amount of money. So if you think about the excesses that happened in the VC world, fintech was the excess of the excesses. Obviously, when there’s any kind of readjustment, the place that honestly overdoses on capital, let’s say, is the place that’s going to suffer the most first and actually be oversold quite dramatically. So you saw that during the course of 2022, and 2023, we saw a continuation of that.

Aman Behzad: Obviously, the hiking interest rate environment, where venture capital in itself and private equity becomes a somewhat less attractive investment class when you can secure personal, you can secure bank deposit returns at 6, 7, 8% and corporate debt returns at kind of 12, 13, 14%. So why would you be all in for a 25% to 30% IRR return with a huge amount of risk when you had all these kinds of really safe, conventional instruments out there? That’s been a big contributor to how much capital has been available in the market, translating into where valuations are today. If you talk about hard numbers in terms of valuation, we went through a period of time from I would say 2017 onwards. It was growth at all costs, growth disproportionately valued when it came to how public companies were trading. You saw a clear correlation between revenue growth percentages and multiples that they traded on revenue. You then saw a pivot during 2022, dramatically the other way towards profitability, where cash was king, anything that consumed cash, people stayed away from anything that was generating cash people wanted to plow into. So during the course of 2022, you saw a huge correlation between strongly positive EBITDA companies and enterprise value to revenue multiple. Being very high during the back end of 2022 and through the course of 2023, you’ve seen a recalibration of that. Obviously, what everybody’s popularized, the rule of 40 or rule of 50 in some quarters in terms of adding up what the company’s revenue growth is and their EBITDA margin, and that being very closely correlated to a company’s valuation, I think during the course of this year, and we need to run some numbers here because we haven’t done it in about a month or two.

Aman Behzad: I think during the course of this year, revenue growth will probably be valued two times more than profitability, but companies will still need to be profitable. So that’s a little bit of an overall context about what’s being valued in the market. I do think we very much reached an equilibrium of buyer and seller expectations, both on the M&A and on the capital raising side, so deals should be getting done. The one roadblock to deals getting done in significant numbers is the inertia that exists within, particularly a lot of the private companies around very complicated shareholder structures that they’ve had to adopt over the last couple of years in terms of firstly, very high multiples before in pricing and then secondly, emergency funding that they’ve taken on over the last couple of years and how that unwinds itself in a more normalized valuation environment. So that I think, is the sacred cow to be slaughtered, which will open up the dams of all of this capital that’s out there. We’ve got something like $600 billion venture capital money that needs to be deployed, dry powder that’s sitting out there, that needs to be put to work. You’ve got something like $1.3 trillion of cash on the balance sheet for a Nasdaq company. So all of this money needs to go somewhere and it will go into M&A and capital raising activity. It’s just a case of the exact timing of that.

Jacob Hollabaugh: Very interesting. Is this kind of cycle that we’ve gone through unique to the times that we were going through, or is it a type of cycle that has played out before, or is this industry with how you explain even getting your start a little bit newer world, that maybe this is the first time and maybe this cycle would play out to some degree again in the future? But this is the first time the fintech world has gone through it. What’s everyone’s familiarity with the ebbs and flows that we have seen and that you just laid out so wonderfully for us?

Aman Behzad: I think disruption, market dislocation and market access is just a feature of pretty much every industry, and every cell vertical technology overall. Then once the technology vertical started to fragment into health tech, fintech, payroll, technology, HR, technology, etc., all of these verticals started to go through their kind of periods of oscillation between excess and famine, or having very little dearth of dearth of capital. What I can say is, that every time these cycles play themselves out, the next cycle, the amplitude of the next cycle is ratcheted up. So things are much more frothy and then much more negative as a result. So you always see this massive uptick and then a trough, and then you’ll see it again in 15 or 20 years’ time, even bigger than the one that maybe you’ve seen. Now, this is definitely the first big valuation reset disruptive event that’s happened in the world of financial technology. The reason why there’s been this delay of funding capital, a readjustment that we probably would have expected ordinarily 18 months ago, 12 to 18 months ago, is because of the excesses that happened before. They just need to unwind themselves a little bit more over the next, I’d say 6 to 9 months.

Jacob Hollabaugh: You mentioned all the many different verticals that have sprouted up and branched off even a little bit or more defined within the world of fintech. Are there right now any specific verticals that you feel stand out as the hottest markets for growth in innovation, or are the ones that maybe are still having on more of that excess portion of that cycle? What are the hottest markets, the most standout verticals within fintech right now?

Aman Behzad: Fintech has taken a turn towards being much more conservative in many regards. So it’s all those kinds of old school, conservative, very nice, reliable models that are getting all the love and the attention. Payments businesses continue to attract a lot of capital, particularly cross-border, where there’s where there are, let’s say they continue to be very strong margins available for efficient players to go after wealth management, asset businesses, asset management, wealth management, and fintech businesses. So anybody who’s facilitating either a B2B solution or a B2C solution remains very much in vogue. These are kind of stable models where you’re carrying a fee based on AUM, which accumulates and builds slowly over time, meticulously through high-quality service, and you get decent growth, good growth, but more importantly, very strong operating leverage with many more of the marginal dollars that you’re making at the top line pouring down to the bottom line. So those are the kind of sectors that are, let’s say, quote unquote hot, if you would use that word. The other, which I think is back on is climate fintech. We did our first climate fintech deal about 12 months ago, which was a business that was focused on providing risk analytics for climate risk analytics for Fortune Five Hundred companies are able to ultimately use that data and information to be able to price against climate change and secure climate change insurance. Those kinds of asset classes where fintech meets climate tech are also incredibly hot. We’ve seen a number of deals happen at really, you know, 20-plus ARR multiples where people have taken know-how that other large strategies can very strongly exploit or indeed have a great organic growth trajectory ahead of them that investors want to get behind them at and pay whatever price it is today.

Jacob Hollabaugh: Fascinating stuff. You mentioned there and in a couple of previous answers, but asked directly when you’re consulting on an investment or an M&A deal, are there any key numbers or characteristics that stand out as the most important right now? You mentioned when that answer that the conservative companies are winning. You mentioned a few key numbers that are standing out more in cash flow and everything versus growth before. But when you’re trying to tell the story of how a company is performing, going through one of these deals right now, I’m sure you’ve got an extremely thorough checklist. It’s a lot more than just 1 or 2 things. But what’s maybe of the highest importance right now, the top of that checklist when you’re going through one of these deals?

Aman Behzad: In terms of raw numbers that investors and buyers are incredibly sensitive to, it’s unsurprising but also interesting to see it bubble up so far. Top one is the ratio of capital raised to date versus the revenue trajectory that a company has. That’s becoming a very high focus. If you’re in excess of three times the capital raised to revenue, then investors get a little bit nervous about how efficient your business is, being able to scale and grow aligned to that or tied to that, although more specifically every quarter, are things is the burn multiple. So that’s the ratio of how much capital you burn to being able to secure incremental revenue. Then you have the classics, which are your customer lifetime value to customer acquisition, and cost ratio that a lot of companies have to be out there with before the definition of this. These used to be pretty stretched. So people look at lifetimes over 20 years, 40 years, infinity, they could get away with it. Now it’s a very strong focus over the next three years in terms of lifetime acquisition costs that need to be fully loaded, as opposed to being some kind of mish-mash of fixed cost and the least possible cost people can associate with an incremental on-board. Those metrics themselves needed to be in excess of three and four times before. You really need to be solidly displaying sort of five six-plus for it to be a business that becomes a nicely investable business. Then coming back to what I was saying before, in terms of being a rule of 40 business like being that rule of 40, sweet spot bucket and ideally rule of 50, you really giving yourselves the best chances of success when it comes to capital raising or sale at a very attractive price.

Jacob Hollabaugh: Makes sense. Let’s change gears slightly. I want to ask about a couple of trends that I’m sure come up within everything you’re doing and definitely have come up a lot on this show in the last year or so. The first one relates to you guys recently published your thematic report on open banking. And I just want to say and shout out we, you know, say links and where to go find more information from your company later on. But the reports that you put out have someone who’s read a lot from a lot of different companies similar to yours. Your reports are very good and worth reading, and I don’t necessarily say that to everyone. So I was enjoying the open banking one, and open banking has been a frequent topic on this show recently. Are there any thoughts and insights you can share from that report on how open banking is currently changing the financial landscape, and kind of the role that it’s going to play in the future?

Aman Behzad: Yeah, that’s a huge question. If I characterize it more along the lines of open finance as opposed to necessarily open banking. So that’s opening up bank and insurer and wealth management APIs across the board, and being able to have sovereignty over your own personal data and how it’s used, as well as being able to allow seamless transition of customer information from company to company. That opportunity is massive and transformational in pretty much every part of the fintech world, which by definition means every interaction that you might have. So the open banking world started off just being focused on open Banking 1.0, which was data insights and aggregation of people’s spending patterns, which is great to know that I spent $20 on groceries last week, and of that half of that was on fruit purchases. But in terms of getting me to pay for it, that’s quite a tough proposition. So you saw a lot of innovation in the open banking space about ways in which they can monetize their models, and that monetization has forced a lot of very smart people to do a lot of clever work around how they integrate these open APIs now across the board to deliver cheaper payments. So, for example, a number of the large payment services providers don’t talk about it because it’s obviously cannibalistic to their existing business, but a lot of them offer a pay-by-bag solution, which they have to offer, which carries a $0.01 charge versus a 2% fee that they can charge on a credit card that’s being done for a credit card transaction online.

Aman Behzad: An ability to seamlessly aggregate all of your. Personal wealth positions on one application, be able to manage different pockets of money and move money from one place to another without having to do with the rigmarole of form filling and the kind of quote-unquote, moats that existed between transferring money between different pension providers or indeed different wealth management. And then finally, and most importantly, I would say open banking is really the facilitation for me of what makes it really interesting is the ability for me to actually finally control all of my financial data and decide who I share it with, how I get paid for it, where it sits and resides, and how I can optimize its value to myself and not to some market or PR firm, or indeed some financial services business that wants to just hawk me the latest product that they have. So in this way, I think open banking is the fundamental catalyst in my mind that is already changing because it’s been around for a while, but will fundamentally change the way every consumer, and indeed ultimately every SME or every corporation interacts with their financial services provider, be they an insurer, a bank or an asset manager.

Jacob Hollabaugh: It’s fascinating stuff. Another big trend or at least a talking point of the last few years, and a world in a market that has seen as big a fluctuation as any has been cryptocurrency and blockchain tech, and just the idea that we have new ways and tools to build financial systems around. And that’s a completely new frontier for the world. What is the general sentiment within the rest of the financial world right now towards cryptocurrencies and blockchain tech? The public consumers see and hear one thing. We see all the headlines and everything that might mean absolutely nothing behind the scenes where it actually counts. So behind the scenes is there restored enthusiasm and interest in what the sentiment towards crypto and blockchain tech in the world of finance right now?

Aman Behzad: Look, I think the first thing is we shook out all the bad actors or at least all the ones that are publicly known. There may be some more that count, but for the most part, I think the bad guys have been, I would say bad guys, but let’s say people who are operating with slightly different kind of standards to the way in which we’d like financial services to be provided.

Jacob Hollabaugh: The natural influx, I think people forget that so often is a brand new world, a brand new industry. You’re everyone that comes into it. It’s not going to be pure and perfect from the beginning, and there’s going to be some that come in, whether they have good or bad intentions, that create a lot of negative outcomes. First, as we sort out what works, what doesn’t, how should this work, how everything. So yeah, we’ve gotten rid of those. And I like that you point that out first. Yeah.

Aman Behzad: That meant that I think there’s going to be a lot there’s a lot more, let’s say security, safety and personnel, personal and corporate comfort, let’s say, of interacting with these new kinds of digital currencies and digital techniques of storing value, sharing value, sending value, creating value. So that’s the first thing I’d start off by saying that you’ve obviously seen the launch of the ETF, products that have been out there that have seen enormous uptake. I think it’s very clear that the world over large asset managers are the first to be that that recognize the fact that individual clients, be they small-fish consumers or be they multi-billionaires want to be able to hold and own crypto asset classes as part of their portfolio of assets alongside any gold they may hold or shares or bonds or like any other asset. So I think it’s very clear that mass adoption and mass demand for crypto is here to stay. The next step along that journey is really thinking about the use cases. And so we’ve seen the first few sets of use cases play themselves out. I think there are going to be far more use cases that will become apparent over the next 5 to 10 years. And they’re going to blow our minds and it will trigger mass adoption. If I look at the business that operates in Africa called Yellow Card. So Yellow Card does cross-border money transfer in the form largely of stablecoins, so largely USDT, USDC. And if you compare their success rates of money transfer, the speed at which they transfer money and the cost, it blows absolutely everybody else out of the water. The Western Union’s the MoneyGram’s any other way of conventional money transfer, even if it’s fully digital, it can’t compete. It’s a systematic, unfair structural advantage.

Aman Behzad: So if you go to speak to an average person going into a Western Union in the US, transferring money into, I don’t know, Kenya wants to transfer $100, he could well be on the hook for 10 or $15 of fees, whereas somebody doing that via a stable-coin could do that at not even $0.10 or $0.15 of cost. And it’s instantaneous. So I think the use cases of these products are enormous. You’re going to see companies instead of having to. We live in the Western world, so we’re used to certain kinds of norms and conventions that we forget don’t actually exist for the other 80% of the world. When we want to transfer the kind of the fruitiest money transfers we all do will be from either a dollar, euro, or sterling into another currency. There’s always liquidity for you to transfer your money from US dollars into Mexican pesos, or from US dollars into the Kenyan shilling, for example. That’s not really a problem. But if you’re a Kenyan business and you want to do business with a Tanzanian business or a business based in Malawi, you can’t transfer your shilling into kwacha. It’s almost impossible because the currency and exchange rates move so much and because the costs are so prohibitive. So you have to step up first to convert your currency into US dollars, and then from US dollars back down into that local currency. So there are so many use cases that we don’t see and understand where cryptocurrencies and decentralized exchanges, crypto infrastructure is now just finding its place in the world, and it will be an immovable feature of the world of financial services going forward. In fact, it will be the future of financial services if we fast forward 20-odd years from now.

Jacob Hollabaugh: Absolutely. When it’s just that much better when it has that many winning attributes to it, it isn’t a question of if, but it is just of when and especially for us recording from in the States. We tend to only look through things at first through the view of use case us. How do everything, how does everything operate for us and not realize that that might not be the case and isn’t the case more often than not? A lot of other places where maybe we’re not the ones to show those use cases perfectly at first show the value at first, but it’s out there to exist, and eventually, it is going to win out if it’s just that much better. The final question I have for you is, then what is the biggest trend you’re seeing in fintech that we haven’t discussed yet? Is there anything that we haven’t touched on here that is coming up top of mind for you repeatedly in your day to day, that as far as impact on the industry moving forward, what’s the biggest topic we haven’t hit that is taken up the most of your time right now? Thinking through what it’s going to look, and how it’s going to impact the industry?

Aman Behzad: So it’s been talked about a lot for the last 2 or 3 years, and it went through a bit of hype, let’s say 18 months ago, two years ago, let’s say, and got dragged through some pretty negative headlines over the last 12 months, which is the world of banking as a service and embedded finance. There have been obviously some very high-profile failures. There have been a lot of bank license revocations, situations around certain BaaS players having their licenses taken away, their permissions taken away, their clients taken away, them being shut down, disputes with partner banks, and disputes with clients. So we’ve seen a lot of a huge amount of noise in that banking as a service space, but that is an enormous market. We issued a report on this as well in terms of BaaS, 1.0, 2.0, 3.0, and I won’t bore you by going into that, the way in which we think about the world of BaaS. But the big trend here is everything that we do on a day-to-day basis involves some kind of transaction, some kind of transactional relationship where you could be buying a plane ticket online and you’re obviously making a payment. You get into your car, you have you’ve obviously insured your vehicle to be able to drive it. There are financial services transactions that happen that you’ll do 50, 60, 100 times a day that you won’t even be aware of. It’s really about how those financial products are integrated into your daily life in a seamless way, so you don’t even notice them. And to how actually non-financial companies, non-financial services companies can offer those financial services products in a compliant way that satisfies both regulators from a capital standpoint, from a KYC standpoint, from an AML standpoint, and how that allows those companies to capture more margin, more revenue for the services that they offer. That is something that’s going to be a huge trend over the next 10 to 15, 20 years. I would even say. That’s coming up a hell of a lot at the moment.

Jacob Hollabaugh: Love it. Well, man, this has been a real pleasure for those listening who may want to learn more about Royal Park Partners or get in touch with you, keep up with everything you and the company have going on, where it’d be the best place for them to go to find you.

Aman Behzad: It would be our website, please take a look. We also have a very cool but even I don’t mind saying so myself analytic dashboard. So you can get a wealth of free information comps and multiples on companies our latest reports, do screening analysis on the data that we have there, which I think is a phenomenal resource if you’re looking to do any date, any research in the world of fintech. So please do have a look there. And then obviously there’s a Contact Us email link as well. So you should please feel free to reach out to us if you’ve got any questions on our material, our services, and maybe the ways we can just be helpful to you going forward.

Jacob Hollabaugh: Wonderful. We will link to those and more in the show notes below. Aman, thank you so much for your time and knowledge today. I’ve greatly enjoyed it and hope to speak again sometime soon.

Aman Behzad: Thanks a lot, Jacob.

Jacob Hollabaugh: If you enjoyed this episode and want to hear more, head on over to to subscribe on your podcast listening platform of choice. That’s