10,000 subscribers later, This Week in Fintech has a venture fund – TechCrunch
If you keep up with financial technology, you likely know that the fintech community is a tight-knit, large (yet small) group of enthusiasts that includes all sorts of people — from founders, to investors, to fintech-focused employees at startups or large companies to journalists like me.
Over the years, a few players have emerged with a special kind of knowledge and expertise in the space. Nik Milanović has been publishing a newsletter called “This Week in Fintech” for the past two and a half years, growing its subscriber base to north of 10,000. He also spent the past two years at Google, heading up business development and strategy for Google Pay as well as serving as a mentor through Techstars. All the while, Milanović has not only been an integral member of the growing global fintech community, he has helped build and grow it. In addition to publishing the newsletter, Milanović sponsors meetups all across the globe (from Mexico City to Lagos, Nigeria) so that thousands of fellow “fintech friends” — as he calls them — can network and get to know each other.
Inclusion has played a big role in Milanović’s fintech aspirations. During his time at Stanford University, he was a researcher at the Stanford Center for the Study of Poverty and Inequality. (Full disclosure, he has written for TechCrunch as a contributor on topics such as “Build products that improve the lives of inmates.”)
While Milanović has invested as an angel in recent years, he is now taking the plunge to full-time investing with a new early-stage fund called simply “The Fintech Fund” with the tagline of “by fintech people, for fintech people.” His goal is to raise $10 million for the new fund (of which he has so far brought in $4 million), and already it has a diverse group of LPs, including Better Tomorrow Ventures’ Sheel Mohnot and Jake Gibson; Cowboy Ventures’ Jillian Williams; Sriram Krishnan, founder of Angel Collective Opportunity Fund; Bain Capital Ventures and founders such as NerdWallet co-founder Jake Gibson, Orum.io’s Stephany Kirkpatrick and The Block’s Mike Dudas.
Better Tomorrow Ventures’ Mohnot told TechCrunch that he “loves” the global community that Milanović is building, especially since he believes that “community is an incredibly powerful lever for startups.”
“Nik sees the world similarly to us at BTV; there is an incredible global opportunity that others aren’t seeing,” he said. “We wanted to support Nik in part because we like him, in part because he will be successful and in part because we think we’ll get to see great companies by working closer with him.”
The Fintech Fund is investing at the pre-seed and seed stages, and so far has backed 10 companies, including Goldfinch, 3Box, Ponto and Paysail.
“The goal is to make this kind of a community fund, rather than an undifferentiated out-of-the box venture fund,” Milanović said. “Our focus is to give the people and institutions working deeply in fintech a way to reinvest in the fintech ecosystem.”
The Fintech Fund also has a 120-person fintech syndicate, where all members are fintech operators or founders. The fund gives members of the syndicate the opportunity to double-down on the fund’s investments with the founders “they really want to support,” Milanović said.
The new fund is also holding itself to a quantitative commitment to inclusion for its founders and syndicate. For founders, it has an explicit target of over 25% or more of its dollars and total number of investments going to founders from underrepresented backgrounds. For the syndicate, Milanović does not plan to set a quota or target, but is measuring the composition of the syndicate and fund LP base on a quarterly basis (via a survey) in an effort to continuously ensure representation and inclusion.
If founders are looking for hands-on investors, they’ll find it in The Fintech Fund, Milanović said.
“There’s a lot of ETFs that will write large checks,” Milanović said. “But our goal is to really bring together this whole community — and that’s newsletter readers, investors in the fund, our angel syndicate — so that when the founder gets a check out of The Fintech Fund, it’s not just money but also a ton of consulting or referrals to new hires and to new customers.”
True to his background, Milanović will continue to provide resources to founders through his newsletter and events because he believes investing in a company’s success should be about more than the money.
“This community can help you decide between two vendors you’re considering or make a referral for like a head of product that you’re looking to hire,” he told TechCrunch. “I think for an early-stage founder, that really makes a huge difference.”
Portfolio company Paysail founders Liam Burke and Nicole Alonso said they have been impressed with Milanović’s “extensive fintech background and understanding of the landscape” since their first meeting with him. The company, which leverages stablecoins to enable instant, global B2B invoicing and payments, recently raised a $4 million seed round led by Uncork Capital that included participation from The Fintech Fund.
“We are also excited by the breadth and diversity of experience the fund’s LPs bring to the table and look forward to tapping into the support they provide to founders, including advisory work, domain expertise, and access to their vast network,” the pair wrote via email.
To Mohnot’s point, Milanović said the VCs that are opting to be LPs in this fund clearly don’t view it as direct competition.
“We want to focus on collaboration,” he said. “Some people view other successful people as competitors with a mentality like ‘I win because I’m best or other people can’t.’”
But Milanović doesn’t subscribe to that philosophy.
“I believe we can all win together as a network and I view this fund as a way for everybody working in fintech to win together,” he said. “And so for me, it was a no-brainer to bring these funds along as LPs and it’s a no-brainer to find people who might be competitors and figure out where to collaborate with them because I think we can collaborate and build things that are way better than the things that we build when we compete.”
Comments are closed, but trackbacks and pingbacks are open.