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Tren Griffin
@trengriffin
, 3 tweets, 2 min read Read on Twitter
Customer Acquisition cost (CAC) in financial services:

"Citi offered cardholders 30,000 airline points to sign up for an online checking account. This quarter, it plans to enhance its Thank You and Double Cash reward programs for select cardholders." google.com/amp/s/www.bloo…
The "game on the field" in consumer banking is upsell and cross sell based on telemetry about customers from a loss leader:

"Citi added $3B in deposits... cardholder spending jumped 6%. Altogether revenue from consumer banking climbed 3% to $8.51B."

bloomberg.com/news/articles/…
A financial services firm that doesn't have the ability to run growth experiments to improve unit economics using modern data science is toast. Every lifetime value factor is constantly being tested, revised and retested. The data science never sleeps.
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Tren Griffin
@trengriffin
1/ Battle of the Banks- CAC vs COGS.

In this corner CAC:

Morgan Stanley: "banks have an advantage in that they don’t have the same customer acquisition costs as startups." bing.com/amp/s/fortune.…
2/ In this corner COGS:

"Zelle, the person-to-person money transfer service created by a coalition of banks cost the banks billions of dollars to launch.

Venmo, a similar app used by millions of millennials, cost in the single digit millions."
3/ The CAC advantage of banks is reduced as financial technology startups start to cross sell ("would you like a credit card or insurance with that?") and upsell ("we have a premium plan for that") as the startups move from unbundling services to rebundling services.
Read 3 tweets
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Tren Griffin
@trengriffin
1/ One way to acquire an analytical edge is to understand the nature of a technological shift like 5G wireless from first principles and in the process you may also acquire an informational edge. This process requires real work and skill to do well. edn.com/electronics-bl…
2/ The article linked in the last tweet doesn't distinguish between an air interface like 5G New Radio and a given frequency used by the mobile operator. If you don't know that difference, someone who does has an analytical and informational edge over you. sciencedirect.com/science/articl…
3/ An analytical edge about 5G is just as useful to investors analyzing a stock line QCOM or VZ as it is to a business deciding what technology to use in creating something like SaaS (PWA? Electron?). The future is always uncertain. But you can improve your odds of success.
Read 4 tweets
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Tren Griffin
@trengriffin
"After the S&P 500's nearly 19% gain this year, the benchmark index is now trading near its fair value relative to interest rates, profitability as well as price-to-book valuations" Goldman. google.com/amp/s/www.cnbc… The tooth fairy has been making the same price-to-book argument.
When I read something like this:

"Traders are fully pricing a quarter-point cut at the July 30-31 Federal Open Market Committee meeting."

I imagine the meeting where this is decided by the "traders" (under a buttonwood tree?) and wonder why "investors" aren't invited?
Many macro predictions that attempt to time changes in the stock market are eventually right exactly once in a row. bloomberg.com/news/articles/… Focusing on when to buy is vastly easier than guessing about when to sell, especially if your focus is on a specific actual business.
Read 3 tweets

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Erik Torenberg
@eriktorenberg
A common trope in VC is to ask whether the most important thing is the product, market, or team.

@pmarca @eladgil @arachleff agree:

Markets are most important

But how to evaluate and pick markets?

@nujabrol and I are working on a definitive guide. Some preliminary thoughts:
“When a great team meets a lousy market, market wins. When a lousy team meets a great market, market wins. When a great team meets a great market, something special happens.” — Andy Rachleff
Conversely, “Conversely, in a terrible market, you can have the best product in the world and an absolutely killer team, and it doesn't matter -- you're going to fail.” - @pmarca
Read 46 tweets
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Ryan Caldbeck
@ryan_caldbeck
1/ Over the last 9-12 months I’ve noticed a somewhat fascinating trend in my conversations with successful consumer tech investors:

Many are out on DTC only brands.
2/ What was a category these investors were extremely excited about just a few years ago, now is getting very little attention from some of the most high profile investors that would publicly be considered DTC experts.
3/ First let’s re-calibrate on why they were excited in the first place.

Then let’s talk about why the train came off the tracks.
Read 25 tweets
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Philip Obin
@PhilipObin
What does Digital Revolution mean?
The Digital Revolution refers to the advancement of technology from analog electronic and mechanical devices to the digital technology available today. The era started to during the 1980s and is ongoing. The Digital Revolution also marks the beginning of the Information Era.
The world of digital media is changing at a phenomenal pace. Its constantly evolving technologies, and the way people are using them, are transforming not just how we access our information, but how we interact and communicate with one another on a global scale.
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Private Investment Brief
@ThePIBnyc
We've discussed before, in this feed and in the main PIB publication, the concept of "neo-value investing," defined as "the effort to apply the principles of value investing to newer, faster-growing, often tech companies." And when I speak of the...
..."principles of value investing," I mean things like a long-term time horizon, a very strong emphasis on the safety and certainty of a forecasted outcome, and upside expectations that are ambitious, but not at the expense of safety and certainty. Now then, it seems to me...
...that if you wish to succeed as a neo-value investor, you must acquire some expertise in and appreciation for "neo-value capital allocation"—that is, in whether the individual capital allocation decisions made inside companies themselves conform to the principles of value...
Read 7 tweets
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Taylor Pearson
@TaylorPearsonMe
1/ The 3 Real Marketing Strategies that I Know Actually Work. A thread.
2/ The prerequisite for any company to have successful marketing is that they must define and own a category.
3/ Competing with established brands in an established product category never works and will drive up your customer acquisition cost (CAC) to an unsustainable level.
Read 25 tweets
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David King 🔥
@dksf
1/ I was thinking about some of the things I've changed my mind about in the past 10 years.

Here's a list:
2/ I used to think of angel investing versus professional venture capital investing as "little league" versus "major league". Now I see them as two very different crafts, but with related skillsets and sometimes cross-over practitioners.
3/ I used to be skeptical of "fin-tech" as it seemed like a weak combination of traditional Internet customer acquisition applied to traditional financial services business models. Now I think fin-tech may be one of the most interesting/impactful areas of technology today.
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