rebundling financial products What does it look like after you’ve launched your 昀椀rst successful 昀椀nancial product? The number of monoline FinTechs out there is endless, and we think the most agile and strategic teams understand this risk. As a result, the playbook has rapidly evolved to leverage your existing customer base to cross-sell additional products. The outcome, ironically, is that the winners are starting to look like… traditional banks. The math behind it is simple. As FinTechs start to make a dent in the $24 billion annual FinTech ad spend, they often discover that they need additional lines of gross margin to cover the customer acquisition cost (CAC). The playbook becomes obvious because it’s necessary. However, getting there ultimately comes back to the question of engagement. We have seen over the last decade a large number of FinTechs, many of which even went public, that failed to successfully execute on their second act. The most important point of commonality that we see amongst these businesses that were ultimately unable to deliver ARPU growth is a lack of engagement on the 昀椀rst product. new product innovations bolster arpu for players25 Annualized ARPU per Customer Annualized ARPU per Customer $50 $64 $40 $56 $30 $20 $48 $10 $0 $40 2016 2017 2018 2019 2020 2013 2014 2015 2016 2017 2018 2019 2020 Historically, FinTechs that have shown strong growth and continued development invariably 昀椀nd a way to manage their customer acquisition costs while scaling their LTV over time. There is magic to accomplishing harmony here. The charts above illustrate two FinTechs that have managed successfully to grow their ARPU steadily over time. In the case of Bill. com, revenue per customer has gradually increased with the addition of more seats over time per customer, more services o昀昀ered, and increased usage of the platform. After starting with a base SaaS fee and capturing SMBs and accountants, they o昀昀ered strategic products such as virtual cards, international payments, real-time payments, and more. In the case of Revolut, the company went from providing basic banking services for consumers to providing early wage access, crypto, and even crossed over to o昀昀ering SMB 昀椀nancial services with business bank accounts, money transfers, and expenses. START WITH CUSTOMER ACQUISITION SHARE VISIT PG 18