Man, all due respect. You gave it the old Ricky Bobby. Bitcoin hit over $40,000 dollars a coin last week, and has since pulled back a little bit. Now, with that said, this is also a business that actually has recorded -- I can't believe it -- positive net income, this thing is actually profitable? There's three main arguments that I always hear when people tell me I should own bitcoin. [laughs] You've got it figured out. Also, a private company is not generally required to disclose financial or business information to the public. [laughs] But I got to believe the biggest risk, it's not just valuation, it's got to maintain its growth, and there's a huge element of competition risk in this space. Upstart's not a bank itself like a lot of these fintechs. In April 2019, SoFi CEO Anthony Noto stated in an interview with Yahoo! Companies like Upstart are really changing that model around. [laughs] It helps businesses process checks and things like that. This is unusual, as retail investors typically don’t get allocated pre-IPO shares, and instead must get into markets on the first-day trading rush (at inflated prices). But even then, I was just astounded at how difficult it was, and you could see the frustration from the clients when they came in, and you had to call them back in, and we had to call for more documentation, and needed another signature. [laughs] That's OK, don't worry, we still own PayPal, so we got part of it there. I don't care. Upstart is a personal lender, that's pretty much what business they're involved in right now. Prior to an IPO, a company is “private,” which means that shares of stock are not available for sale to the general public. It feels like this is a good management story too. A company that goes through the IPO … sofi.com | FinTech | Founded: 2011 | Funding to Date: $3.28B. A powerful ecosystem of innovators and … For example, did you know that having a college degree is an indicator of better loan performance? Frankel: Well, like you said, they are pretty recent IPO, and given the times, like every other IPO, they've shot through the roof since they [laughs] went public. Because that was an advantage that Xoom really built out, in building their risk model was ultimately building out these data points, that help them assess risks far better than these traditional players in that remittance space. Technology then wasn't where it is today, so I can imagine that it really resonates with that younger consumer. It was a really fun conversation. But I don't see it translating to widespread mainstream adoption anytime in the next decade or more. We'll get into the actual business shortly, but that's the general idea of how this merger is happening. | Crowdfund Insider: Global Fintech News, including Crowdfunding, Blockchain and more. No. That's not a stored value. ... Social Finance (SoFi… Based in San Francisco, SoFi provides … Last May, SoFi … If they can address that area of the lending market, which is millions of people better than anyone else, they're going to keep growing like this. We mentioned personal loans, the student loans, they just launched their credit card product on the lending side, they also have a high-yield savings platform, they have an investing platform where you can buy and sell stocks similar to Robinhood, I would call it, but honestly doing a better job of educating the consumer and really bringing the community into the investing process, not just trading. If approved, they're going to be a bank. When we get to SoFi, you'll see there are in a bunch of different types of financial businesses. Frankel: My savings account is a stored value because its value doesn't fluctuate. Frankel: It's a fee income business model. Moser: I guess. That's pretty impressive. I want to see how that's playing out. Frankel: On that note, it's interesting to point out how Upstart makes its money. I know what I don't know. SoFi pre-IPO shares Someone who wants to purchase pre-IPO shares of a company can check for filings on platforms like SPAC Research and SPAC Insiders. Frankel: The technology used is the proprietary element of this by far, is that algorithm, the whole non-traditional risk model that they're doing, and the fact that they are willing to really bend on FICO scoring. Matt specializes in writing about bank stocks, REITs, and personal finance, but he loves any investment at the right price. The SharesPost marketplace makes it easy to research private growth companies and transact in their shares and tokens. They're valuing SoFi at about $8.65 billion, including the $2.4 billion and new money that's coming in. Moser: Well, that sounds very good, Matt. Focusing on what I do. They applied for and received conditional approval, like you said, in October, they got conditional approval for a bank charter. We’ve educated thousands of people to get access to Pre IPO Stock Opportunities. As always, people on the program may have interest in the stocks they talk about and The Motley Fool may have formal recommendations for or against, so don't buy your or sell stocks based solely on what you hear. I mean, you could make the argument that PayPal and Square are onboard with bitcoin and PayPal has said that it wants to make bitcoin usable at its merchants. Frankel: Well, for one, well, bitcoin is still several times more than it was at this time last year, so take it with a grain of salt. The new one, SoFi, it's been agreed upon, so it's going public under a SPAC that you can buy on the market right now. They're targeting the overlooked consumers by traditional banks. A SPAC goes public, it has no business operations when it goes public. Who do you think was mostly on the other side of those trades? Frankel: To be fair, I'm usually more excited about a founder owned business years after its IPO. It was a little better as listeners probably know. That's something they have to upkeep, obviously, that comes with responsibilities, and regulations, and ratios, and requirements. Frankel: That's not going to prevent a Reddit thread from popping up. It hasn't proven as a useful currency over the U.S. dollar, especially with all these fintech innovations that we're talking about. You just go into the bank, you get your loan, and then that's that. Moser: Remember, as always, you can reach out to us on Twitter at @MFIndustryFocus. Moser: Yeah, I was thinking that's where we are going. Over the past 24 hours alone, it's down about 18%. It's become easy to transact in foreign currencies. My colleague, Sean Williams, has an article on fool.com right now that points out it would just take a majority of the bitcoin community to agree to raise that. Frankel: It is. The things I'm watching are the default rate. This trend looks likely to continue to grow. Frankel: My pick last week was Wells Fargo. That's --. Lots of news to kick off 2021 – SoFi looking to go public via SPAC; OCC’s groundbreaking guidelines on … Market data powered by FactSet and Web Financial Group. While many have never heard of Social Finance or SoFi, it’s valued at $8 Billion USD which puts it not exactly at the bottom of the list. Frankel: I understand the concept. It probably deserves its own hour. Matt is a Certified Financial Planner based in South Carolina who has been writing for The Motley Fool since 2012. I think that's going to do it for us this week. Like I mentioned in other posts, some platforms allow investors to invest in pre-IPO companies. One thing that really surprised me about this SPAC deal is that the valuation really doesn't seem that insane. To get started investing, check out our quick-start guide to investing in stocks. It seems like there isn’t anything you can’t get at SoFi. I appreciate you digging into Upstart and teaching us a little bit more about that business. We've got another company looking to IPO here very soon in SoFi. I'm not necessarily thinking Wells Fargo is going to pop on the earnings announcement, but there's a lot of details that are going to play into my investment thesis that I talked about last week. In banking, we've been so used to that stereotypical, stodgy, big bank environment. 3 Recommend SoFi: Based on a survey of 1,642 SoFi members from 02/21/2019 to 03/13/2019 who funded a loan with SoFi within 6 months of the survey date, 98% of participants would recommend SoFi to a friend. Moser: Yeah. 82% of millennials have no issue with switching banks. I appreciate that. The idea is that it simplies the traditional process of IPOs, the IPO roadshow, the need to hire new underwriters, things like that. I understand the utility of it. Cumulative Growth of a $10,000 Investment in Stock Advisor, 2 Fintech IPOs to Watch @themotleyfool #stocks $UPST $BAC $GOOGL $WFC $WU $GOOG $LC $PYPL $SQ $ZM $SPCE $DKNG $NKLA $IPOD.U $IPOF.U $OPEN $IPOD $IPOE $CLOV, Copyright, Trademark and Patent Information. Not only that, I checked right before we came on here, there are 4,308 different cryptocurrencies that are officially recognized right now. That's why we're seeing this giant wave of SPAC IPOs. Moser: I think that's probably right. Now that companies like Palantir, Airbnb, and many others have filed for IPO; investors are looking further down the line at companies like SoFi that may eye an IPO at some point in the near future. They use over 1,600 data points, not just the FICO score, they use 1,600 consumer data points to get a really good picture of someone's risk profile. Frankel: So far, to my knowledge, Upstart has no desire to become a bank. SoFi is a finance company that offers a range of lending and wealth management services. Frankel: There's a reason that there's over $100 billion in the second largest cryptocurrency. I want to see any progress on that. I think that with any of these types of businesses, particularly in this current market, the way IPOs have been received, at least in the near-term valuation, has to be at least a concern. II personally don't own any bitcoin. Let's go ahead and start through with Upstart. It's an interesting business model. Beyond that, SoFi is building a stadium in the hood, you know, Inglewood, where Dr. Dre is from. If someone else figures out how to address that market equally well or better, then you could see a lot of competition risks. EquityZen is a marketplace for shares of proven pre IPO tech companies. At the present moment, it is possible to invest in SoFi for as little as $25,000 if you are accredited. Frankel: But I am in the self-employed group. Social Finance, Inc. is an American online personal finance company. In Upstart's case, they want to assess the risks better than banks do. To be fair, it's not the only tech company with a high-value. But what they have done is created a branding for Millenials that works, powered by PR and stats: LevelX also offers Pre IPO investing for accredited investors in companies like SoFi. Right now, I guess, their biggest competitive advantages are proprietary technology. And of course, soon Robinhood itself will go public, now only being offered in the pre ipo markets. That's a market that this non-traditional credit model, by companies like Upstart, can really help solve. Usually, a company's pre-IPO shares are hard to come by unless you’re an institutional investor or an accredited investor. SoFi, including $2.4 billion of new capital, is about $8.65 billion. Let's wrap up with some of the risks or things that we're just keeping our eyes on here. I don't know if you've ever been self employed, but if you've got to apply for a mortgage, or a car loan, or something like that, there's a lot of jump or hoops that banks make you jump through. Jason Moser: It's Monday, Jan. 11. Click HERE to find out ⭐ Pre-IPO Shares of Impossible Foods Available at Manhattan Street Capital. The financial landscape is changing. You said about a 16% stake. Let's pivot over to another business that plays, it seems, in the same sandbox, maybe a little bit of a different focus there on who they are lending to, but we're looking at SoFi, Social Finance, also known as SoFi, looking to go public here possibly soon through the SPAC vehicle. Western Union's been doing it for over 100 years. I'm going to stick with that as my one to watch because they report their earnings on Friday, which is the first day of bank earnings. SoFi is not yet publicly traded, but there is a way to claim a piece of this exciting company’s innovation and growth potential before any IPO. At the present moment, it is possible to invest in SoFi for as little as $25,000 if you are accredited. SoFi will go public via a SPAC … Joining me this week, it's my man, [laughs] Certified Financial Planner, Matt Frankel. Moser: Well, definitely one will enjoy following and covering here on the show for sure it's right up our alley. www.Directipogroup.com to book an appointment or DM for more details. That sounds impressive, right? But [laughs] SoFi does have a big mortgage operation. I understand how it works. Just for our listeners, give us a quick primer there on SPACs. I mentioned Upstart's trading at about 20 times revenue, so far it's trading at about eight times revenue and that's including about $2.4 billion in cash. I get the early adopters who loved the technology and things like that. They have a robo-advisor, there's an insurance division that partners with other insurance companies to offer products to their members. We're going to get the fourth quarter earnings. An IPO is when a company’s shares trade on a public market for the first time. These are two very similar businesses, so I'm going to be interested to get your take on then both. Generally their edge is they offer reduction and fees vs. your behemoth Wall St. banks that get off on charging huge fees. Private Equity “Pre IPO” – Investing in companies before they go public Private Equity is an asset class which involves unregistered securities. Listen, just like I said, we don't cover a lot of bitcoin on this show because it stands on its own. Then that's a big competitive advantage all by itself. It's a volatile day when the U.S. dollar moves by 1% in either direction against say, the euro. I mean, I think we've seen some adjustments to the FICO score in order to make it a little bit more modern, and account for today's consumer. It was something that was helping students deal with student debt, and it really has grown to be a full-fledged banking style operation here. We at Iron Edge VC are very proud to have pre-IPO access to SoFi shares. I think you make a lot of good points there and I'm sure there are folks out there who would take the other side of the coin, so to speak. SoFi wants to be the bank of the future. Frankel: [laughs] Most of the big tech companies that have gone public recently, are founder-led. link Pre IPO Shares Available We have access to Pre IPO shares of SpaceX, Impossible Foods, Sofi, Grab, Ripple Labs, Stripe, automation Anywhere, UI Path, Robinhood, Data Bricks and more. Moser: Yeah, I agree. 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