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Frank Rotman

@fintechjunkie

2 Jul

@RobinhoodApp

1/17: In honor of the @RobinhoodApp S-1 I thought I’d share a conversation I had a few weeks ago with a friend who used Robinhood as his on-ramp into the trading world.

Brace yourselves. It was a fun conversation but pretty eye opening in lots of ways.

2/17: It started with two texts:

“I bought 2 $9 CLOV call options on 6/7 for a total of $170. Expiration 6/18. The value is now at $2450. The share price is up again this morning almost $5. I want to lock in profits but don't want to miss out on future profit by selling now.”

3/17: “Any suggestions on doing this. I was thinking of selling 1 contract to get back my initial investment plus 1400% profit and let the other ride until the day before expiration. Is there any other strategy you may know?”

Read 17 tweets

Frank Rotman

@fintechjunkie

29 Jun

1/27: We’ve seen a few $10B+ lending companies emerge from the fintech ecosystem in the past few years. We’ve also seen a few fintech lenders meltdown in the public markets.

Are lending companies VC backable? Thoughts plus a framework to answer this question👇

2/27: I have to start with a “no duh” statement that too many fintech Investors and Founders don’t do a good job of internalizing. It’s the foundation of every lending business. Effectively Lego block #1.

Simply put: Lenders sell capital

3/27: Lending companies advance capital to borrowers today in return for a stream of payments that will vary based on future market conditions, economic scenarios and borrower characteristics. The volatility of future payment streams is what makes lending challenging.

Read 27 tweets

Frank Rotman

@fintechjunkie

25 Jun

1/19: This may sound funny but I actually have a favorite business model.

We all know that the goal of business is to sell a good/service at a higher price than it costs to manufacture and distribute.

My favorite business model is designed to do this extremely well. 👇🤯

2/19: The easiest way to go broke as a business is to sell dollar bills for less than a dollar. To survive, a business has to sell “widgets” at a price that generates positive contribution margin (PCM). The more PCM generated per “widget” the easier it is to overcome overhead.

3/19: Many business models rely on sourcing goods at wholesale costs and then distributing them through their own channels at a retail price. Buying in bulk at a discount and selling smaller parcels at a premium is how PCM is generated.

Read 20 tweets

Frank Rotman

@fintechjunkie

22 Jun

@ninjawarrior

1/12: It shouldn’t be a surprise that I love helping #startups. It’s what I do. But a little known fact is that my favorite show is American Ninja Warrior (@ninjawarrior). To me, building a #startup has parallels to ANW that great VCs and Founders should internalize. 🧵👇

2/12: It’s hard to deny that startups generate infectious energy. Founders have no political filters clouding their ideas. They have no higher-ups waiting around to smash their ideas. They don’t care about sacred cows and they don’t care if hundred-year-old brands are shattered.

3/12: What Founders care about is solving problems and being better than those that came before them. But while Founders believes that they’re destined to succeed, statistics would suggest otherwise. They’re most likely going to fail or stall somewhere on the way to greatness.

Read 12 tweets

Frank Rotman

@fintechjunkie

17 Jun

1/24: In the past few months I’ve spent dozens of hours mentoring and coaching Founders at the “pre-launch” stage of their #startups. Some are getting close to launch but most are still trying to figure out what they want to build.

Here are 5 take-aways: 🔥🧵👇

2/24: Takeaway 1: Know when to start building

It’s important to know when you’re ready to hire people and start building product. Action orientation is a great characteristic but sometimes the best next step is to do more research. Don’t underestimate the power of learning.

3/24: There’s no formula for knowing when it’s time to start hiring and building, but you should be able to describe a profound problem (problem statement) as well as one or more hypotheses on how a new business model could solve the problem (solution statement).

Read 24 tweets

Frank Rotman

@fintechjunkie

14 Jun

1/17: We all know that Small Businesses are important to our communities. We also know that minority owned Small Businesses don’t have equal access to capital and tools. Is this solvable? Curious to hear about a company working on this challenge? Read on!

2/17: We’ve all heard the phrase that Small Businesses (SMEs) are considered the backbone of the U.S. economy. A quick look at the facts reveals that this statement is very much true. There are currently 31MM registered SMEs that employ about 135MM people in the country!

3/17: While it may seem like big companies hold all the power, it’s undeniable that SMEs play a critical role in their success. Smaller firms supply critical goods and services to big companies. They’re customers of big companies. And they’re catalysts for innovation and change.

Read 17 tweets

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