Former Fintech Nexus CEO, Peter Renton, Discusses the Evolution and Future of Fintech

Rich Alterman  00:04

You're syncing up and tuning in to the lending link podcast powered by GDS Link, where the modern-day lender can dive deeper into the future of data decisioning and Credit Risk Solutions. Welcome to the show, everyone. I'm your host, Rich Alterman, and today we're syncing up with Peter Renton. Peter is the CEO of Renton and company LLC, a consulting firm specializing in FinTech media events and thought leadership. Peter was formerly the co-founder and chairman of FinTech Nexus, a FinTech media and events company that produced 31 large scale events worldwide. The events business was sold to FinTech meetup in 2023 and the media business was shut down in 2024 Peter's been writing about FinTech Since 2010 with over 2500 articles. He's the author and creator of FinTech one on one podcast, the first and longest running FinTech interview series. He's conducted more than 750 interviews and panel discussions and has produced over 1800 newsletters. Peter's been interviewed by Wall Street Journal, Bloomberg, The New York Times, CNBC, CNN, fortune, NPR, Fox, business news, the Financial Times and dozens of other publications. Other credentials include co-founding NSR invest and president of rented media from 2009 to 2014 in this episode, Peter and I will be discussing the evolution of FinTech Nexus, the impact it has had on the industry, some key industry and insights and so much more. But before we dive into the interview, please head over to our LinkedIn and Twitter pages at GDS Link that's GDS L I N, K, and hit those like and follow buttons if you've not done so already. Please subscribe to our podcast on Apple podcast, Spotify, or wherever you prefer to listen to your podcast. All right now, let's get synced with GDS Link. Welcome Peter. Hope you have had a great week so far. Hey, rich, good to see you. Great to see you. Where are you joining us from?

 

Peter Renton  01:59

Today, I'm in our podcast studio in our office in Denver, Colorado.

 

Rich Alterman  02:03

Well, thanks so much for joining this afternoon and a little intimidated sitting here with the podcast guru FinTech industry, but really happy to be with you today and learn more about your background and impact on the financial and fintech services industry. But before we get to talking about business, I'm sure you've listened to some of my podcasts as I have yours, and you know, I was always like to start out with something a little personal, to get to know people a little better, and in sharing some initial exchanges with you, I understand one of your favorite summertime activities is hiking in the Colorado mountains, and that you and your wife take a backpacking trip every year covering 40 or 60 miles of remote terrain over four days. It's pretty incredible. So why don't you please share a story of one of your more memorable trips, and maybe talk about any hiking destinations that you still have on your bucket list.

 

Peter Renton  02:49

I have so many hiking destinations on my bucket list, but let's start with the backpacking trip. This is we only just started this fairly recently. During the pandemic, we used to always do day hikes. Did a lot of that, but then during the pandemic, when things were, you know, kind of crazy, and being outdoors was pretty safe, so we decided to start backpacking. And we we've done so we've done like four or five trips now, like four trips, and then got our fifth trip coming up here in a few weeks. But I think we've I love the Colorado Trail, which is a trail that goes from Denver to Durango, which is one of the ones that's on my bucket list. It's just under 500 miles. And one day I want to, I'd like to do that from start to finish in one summer. But so, I've been, we've been doing sort of some segments of it. And last year, though, was, was my favorite one we've done, because we did a, there's this thing called the collegiate loop, which a big loop in right up very, very high up in the Colorado mountains. We're talking average elevation of around 11,000 feet. Oh, wow. So, it's, it's high. And what we did a portion of that, and then we made our own kind of it was we were following existing trails. We made our own loop because I didn't want to do the full 150 miles. We did about. We did about 5052 miles. I think it was over four days. But that was just spectacular. We started off on the Colorado trail, and then we cut off into this very unused trail, and we didn't see another human for about over 24 hours on those trails. And we camped out in the middle of nowhere right at around 11,000 feet. And it was just so incredibly peaceful. And the next day, we hiked what's called a 14 here in Colorado, which is a 14,000-foot mountain, because it was only about half a mile out of our way on this on this trail. So, we, we just dropped our bags and went up the last half mile and summited Mount Belford, for those interested. And did, and it was, you know, hiking for 14 years in Colorado that was something that I do every year I've. I started doing it with my son when he was eight. He's now 17, so this is actually going to be our 10th 14 that we're going to do later in the summer. But this was just with my wife and I, and it was, it was such, it's, it was a 14 year that, again, we're in a pretty remote area. If you do one of the 14 is near Denver, you're going to be sharing the mountain with 300 to 500 people on any given day, whereas on this day in where we were, there was three people that we encountered the entire time, and there was no one on top of the mountain when we were there that was just on the way back down.

 

Peter Renton  05:32

So that's nice. Sounds great.

 

Peter Renton  05:33

That was a very memorable trip for us.

 

Rich Alterman  05:35

I'm going to give a shout out to one of my best buddies from high school, David. He recently climbed up to a base camp for Mount Everest. Wow, that's impressive. Did a lot of training for that. And yeah, so a little shout out for him. Do you have that on your bucket list?

 

Peter Renton  05:50

You know, I am just not interested in that particular thing. What I've got on mine is, like, there's so many great hikes in Europe, like, there's the circle of Mont Blanc. There's a whole bunch of other ones there. There's the Ulta video one in Italy in the Dolomites. That's another one. You got the, you know, the Camino in in Spain, which is obviously a very long hike, but something you want to do. And then I want to also do hiking across England, like from coast to coast. That's a barely becoming more popular that hike. I love Norway. I have Norwegian ancestry and tend to do a bit there as well. And then, of course, South America, Patagonia is on our bucket list. And there's, I have a doc I keep. I have an Evernote document that I keep adding to. I started it probably three years ago, right? And I've got about, got about 40 hikes on the things we want to do.

 

Rich Alterman  06:42

that's terrific. Well, thanks for sharing that. So, let's get down to business. You've been involved with the FinTech industry now for over 14 years and have played a major role in helping to advance the various players’ understanding of the FinTech space and the impact that it's had on the financial services industry. So back to our hiking. I'd like to take a hike with you back in time to learn what triggered their initial interests in the space and the terrain you've covered along the way to arriving at your new company, Renton and renting company LLC. So, let's put on our hiking boots and get started. Let's really take this journey back in time.

 

Peter Renton  07:16

Okay. Well, it's as if I start at the beginning. It really starts when I arrived in this country in October of 1991, yes, I am. I am quite old, and it that was I came over here for three to five years as my plan to set up the family business, build it up, you know, either sell it or put someone in to manage it. But, you know, I loved it here. Decided to keep extending. I ended up getting citizenship, married, an American, had kids, and all that sort of thing so but that was sort of the reason I came here was it was for business, and it was something that I never expected I'd be setting up my life here. But anyway, I the family business.

 

Rich Alterman  07:59

Yeah, let me interrupt what. So, what was the family business?

 

Peter Renton  08:01

If you remember the days of catalogs, direct mail, this was a Direct Mail catalog, but it was focused on labels, or stickers for business. So, we had the largest selection of business labels in the world. And we had, we sold, we sold it all through direct mail. Um, this was things like, your account is past you. Thank you for your business anniversary labels, anything that you would send, typically you would send through the mail right now in a business, business way. But I saw the writing on the wall with the with the internet and email and the popularity of email, and I sold that company in 2005 and before I sold it, actually started another company, because I knew I was selling it. So, selling it, that was doing digital label printing, and because I could see that was, that was going to be a new trend. And I was actually the first label printer on Google AdWords back in like 2003 because I started this company in oh one and so that was, that was a, really, I was that was a that was a life changing company for me. We ended up selling that to one of the largest publicly traded printing companies. They paid way too much for it. They probably paid double what they should have, but it was good for me and then I was done with printing. It was really my father's industry more than mine. I've always loved finance, always loved investing. So, I remember reading an article in Money Magazine in like, 2008 because I sold that. I sold my second company in 2008 and then interest rates went to zero. And I, you know, I saw this thing about how I was looking for how to get yield. I wanted to get yield on some of this big pot of money. I didn't want to pull it all in the stock market and then the bond market. So anyway, I've discovered peer to peer lending. And so, I opened up an opened up an account at Lending Club. That was like June of 2009 and just started investing. And then was really happy with returns open up one on prosper, my wife's entire retirement savings into Lending Club, and this is back in 2010 and just was very, very bullish on the whole concept and the yields. And I saw that no one was really writing about this space. It was pretty nascent. And so, I love to write. I was, I sort of toyed with starting a blog on something, and I thought, this is, this is something I can stick my teeth into. So, I started blogging. I started blogging about PDP lending in 2010 and just I was, I was a full-time blogger. I was taking some time off because, you know, we had two young kids at home, and I wanted something that I could do remotely or just not have, not have an office. And so was doing this, making money from sending it was on affiliate marketing, sending investors to Lending Club and prospering. That was my primary source of income.

 

Rich Alterman  10:59

But what it's worth actually, was your blog that had me invest in the Lending Club. So good returns too.

 

Peter Renton  11:06

Yeah, Lending Club doesn't have individual investors anymore, but I still have my prosper account that I opened in 2010 and although I have most of it in a in a retirement account that I opened there in, like it was 2014 as well. So, I'm, I'm still, still love, love the returns that I've been able to get there over many years. But what happened was I so I had a I had a blog; I had a community of people that would actually come and read my stuff. And then people kept on emailing me, saying, you should start a conference where we could all get together. And I said, Oh God, I don't know. I don't really want to start a conference. I don't know anything about doing that. And it kept on coming up. Then I actually was, I was cold email, or the LinkedIn, actual email from my now co-founders that said, Well, you want to start a conference. And I was like, funny, you should say that, because, yes, I do. And so, we started the first lended event, June of 2013 it was sold out. We had to turn people away, and it was even we didn't know what we were doing. We sold 50 tickets, more than we should have, and it was very, very crowded. But it was a success that that continued on in 2014 we you know, the first one was 350 people. The second one was 1,000/3 one was 2500 and it just kept on growing. And we grew back then. This was sort of lending. Was sort of the hot, the hot sort of area of fintech. There were payments that were hot. And money 2020, covered payments and lend, it covered the lending space and we, kind of, you know, we grew up with all the likes of, you know, of Sofi and upstart and Lending Club and prosper and all, all of the FinTech lenders were, you know, at our event, most of them were sponsors. They were all, we got all the CEOs to speak at various times and that became, becoming a big deal. Then we also at this, like concurrent to that, because at the time when we started lender, we didn't think this could possibly be a full-time job, a full-time business, organizing a conference. You do it like four months a year, and then the rest eight months a year, you do something else. So, we started lending Academy investments, which was lending Academy was the name of the blog that I started. And we started a peer-to-peer Fund, which and then lent Academy investments sort of became NSR invest, because we merged with, this is really getting into the weeds here, of the history of peer-to-peer lending. We merged with a nickel steam roller, which was where else how I was doing my investing was through nickel stream roller. So, we did that. We ended up building that up and then selling that in. When was it? We actually merged with lending robot, which was another, was a competitor to nickel steamroller, and we sold the whole thing in, like 2019.

 

Rich Alterman  13:50

So, within that model, like so consumers would actually leverage your fund and let you do the actual investing of their portfolio. Or what was it? More advice on how to strategically invest in Lending Club or prosper?

 

Peter Renton  14:05

Yeah. So, we had, we had really two offerings. We had the fund, which was managed by us, and then we had where we could just, you could sort of do this self-managed where you would use the API that Nicola steamroller had created to order automate your investment into landing club. Those APIs are still working today. I still invest every single day in prosper through those APIs. And we had all the history of the so you could do a lot of data analysis. I went back in those days. You could get serious, serious lift from doing analysis of the of the history, and you know, you could get 400 basis points above the average if you knew what you were doing, what you were doing, and, and so that's what I would create. I'd create my own back, test it, and then use the API to invest in the Lending Club and process. Notes, we built up the conference business, and then what we started to see, you know, companies like SoFi and money lion, they were really foundation. Both of those companies were foundational for us. With them from when they started, basically, and they were, they were going, and we really started at Sofi. They were, they were going to other areas of FinTech, outside of lending, and so with money lion and we, we thought, well, we don't want to be left behind here. If all these peer-to-peer lenders or online, you know, called marketplace lenders back then, if they all start going into other areas of FinTech, they're going, we don't, we don't want them to not come to our events. So, we started branching out ourselves, and we really went into a lot of digital banking type content that was, that was payments as well. We started to go out and, you know, and credit cards, which sort of blends payments and lending. And so, we kind of, we diversified. We still were very strong in lending. We also still considered ourselves the largest lending event because more than half of our content, more than half of our attendees, were focused on the lending space. But we had, for those people that were interested in other areas. We had plenty of other FinTech areas to choose from. So, we did that, and then we had the pandemic, which just about killed us. We were a week away from declaring bankruptcy, when the pandemic PPP, the PPP money, the second PPP came through, and we squeaked, we scraped by, but we still had a lot of debt coming out of that. We had a good, a good 2022 which helped us pay off most of our debt, but not all of it. And then 2023 for us was not a not a great show. We suffered from the FinTech downturn. If you remember, it obviously started in 2022 and then we had an event that was financially really not that successful for us. So, we started shopping around our event and fintech meetup agreed to acquire US. And that was, well, they acquired the events business I should be really what they acquired was our customer list and assigned non-compete, right? That was the, that was one of the simplest acquisitions deals you'll ever do, was like, hold the whole legal document. Was like eight pages, and so that. And then I started working with FinTech meetup to help produce their event. The few of the lender team went over there to work full time and so we helped put on their event in this in 2024 and we'll still be, still be working with them in some capacity, now that, now that I'm a free agent, then, because then fast forward to this year, what we would, what we I guess you'd back up during the pandemic. We started a digital media business because that was the only way we could make money. We had because, if you were just, just to give you an idea, because the pandemic, the pandemic started. We all know in March of 2020, when it really kind of hit home in this country. And our event was for the middle of May. And if you run, if you run an events business, what you do is you sell, you start selling, or you sell all year long. And as you sell, you sell tickets, you sell sponsorships. And as you sell, that funds your business, as you go, and then you get you get a big last chunk of in the last, like three months of the event, you sell about half, half your revenue, sometimes even more than half. And so, we had sold a whole bunch, and then we got the pandemic, and suddenly we had people asking for refunds. And so, we had, can't remember the exact numbers, but it was something like $2 million in the $2 million in the bank and $2.5 million of refund requests. Wow, we were, we were basically bankrupt right then, but so what we did was we thought, well, let's, let's just really, we were finding our webinars. Because this was new. The pandemic was such, such new, a new territory for all of us, particularly in the lending space, with consumer lenders, we would have webinars. We'd have 1000 people on a webinar. Now, typically, that typically was a lot less than that, but that, because there was so much interest the small business space, the consumer space, lot of interest. So, we started selling webinars. And what we do is, instead of refunding a company, we say, hey, we owe you $30,000 How about we give you two webinars, and you will get, you'll get your leads because we're not doing an event, so you're not going to get leads from our event. You'll get leads in the webinar. So, we, we ended up churning over, you know, I would say it was well over half, probably two thirds of that in the refund request got soaked up by the digital offering. So, we had a thriving digital media business, and so we kept that going all the way. And people, I thought the pandemic would end, no one would want to do a webinar ever again, because we bid on Zoom nonstop for three years. But that wasn't true. People do what we like. We would. We were doing webinars. Hours once or twice a week, all the way through from, you know, basically March of 2020 all the way through till, due to this, yeah, June of this year, when, before we closed the business down. But the trouble was, we couldn't do enough of them to really make it work financially. And, you know, we had, and we prepared the team way down to like, five people. But we that's what we thought after the after we sold the events business to FinTech meetup. We thought, let's see if we can really build like we'll put all of our effort into digital media. And we thought that could really be a thriving business. And it turns out, it's, it's really hard to make money in that business. So, while we certainly did webinars, we certainly sold a lot of advertising and email blasts and that sort of thing. We just couldn't make it work. Where it was a really sustainable business. We didn't break even over the past 12 months, so we thought we would give it 12 months, and it didn't work, so we shut the company down. Well, as I'm recording this, it was six days ago.

 

Rich Alterman  21:02

Well, thanks for joining us on the heels of that announcement, but great, yeah, thanks for that. And yeah, it's when I was preparing for the podcast. I felt like I was doing a genealogy exercise and trying to track all the different moving parts of you of your career there. So, thanks for helping us walk through that journey. So, when, you know, when we talk about FinTech Nexus, you know, formerly known as lend it, you've had conferences in the US, UK, Europe, Latin America and China. And, you know, I thought it might be interesting to ask you, you know, as you're looking to do this in China, you know, what were some of the unique challenges you had pulling it off there? And you know where, where? You know, from your point of view, where is China today, from a FinTech perspective, compared to, let's say, the US,

 

Peter Renton  21:47

yeah, China is the most fascinating country on the face of the earth. FinTech, I think it was with that was the most, just craziest five years we had. We had. We started in 2014 we had our last one in 2018 we got up, you know, got up to, like, 2500 people at our Chinese event. Because think about China back then. They all wanted to learn from the US, even though, and particularly if you look at the marketplace lending space in China, it was larger than the rest of the world combined, significantly larger. And it was, it was monstrously big. And so, we came along, and everyone wanted to be at our event, because they wanted, they wanted, like it was sort of a badge of honor to be, like a speaker, a sponsor, at our event. So, we actually ended up doing really well there for a short time, but it, it was incredibly challenging in it you needed the right partner. None of us spoke Chinese, none of us had any experience. But, you know, from the very first event, I still remember the meeting in 2013 where we had, you know, we had these 10 people, 1010, people from China signed up and bought a ticket to our 2013 event. We thought, what the hell. Okay. And then they wanted to meet us. So, we talked to them afterwards, and they said, We want you to come to China. And we thought, well, we just started this business. Let's, you know, let's table that for a while. And they kept on. And so we did an exploratory trip in 20 in 2014 and then we, we did it. We CO, we co-branded a conference in 2014 and 2015 and 2016 we launched our own unique conference that we did ourselves. And we started off with a partner that just didn't get it done. It was going to be a disaster. Then we found a different partner, and these this new partner was someone who actually specialized in bringing FinTech executives, or it was back then it was really more of the lending space they would bring. We had an hour for our 2015 event. I think it was in New York. They bought 250 people from China to our New York event. So that was when we saw them, that they'd never put on an event before. So, they but, but we ended up, we ended up going with them as our well. They weren't our original partner. We went on with someone who put on events before, but they just were doing nothing like we had zero sponsorship four months out. And so, we got this new, new company, we ended up doing really well. But, you know, things in you think things are last minute here in China, things are crazy last minute, where we get 1000 people signing up the week before the event. It's just so insane. And then you obviously, you've got to do everything. Everything has to happen on WeChat, and you have to have, you have to take payments that way. And it's just all very, very different, like email doesn't really exist in China in any significant way for business. It was all, all, all WeChat based. And so, our partners helped us all with that. We always we and we brought people over. We actually ended up doing we would. We had executive tours, we call it. We did them like I think we did, or executive tours four years in a row, where we'd bring Western executives to China to learn, we go introduce to the leaders in the. Chinese market introduced to investors. I mean, some of the investments that happened in for many of the, you know, the lenders in in the US and the UK, came through these executive tours, where we would introduce them to the Chinese investors. And then, then what happened in 2019 we were putting together our next, you know, the next year's event, and we found that we had zero sponsorship signups, and we knew that things start were last minute, but normally we'd have, like, 20 or 30 by, you know, by four months out, we had zero and that was just because the Chinese government was clamping down on the PDP lending space, and no one wanted to be seen in public at an event, so they we just had to cancel. There was just no it was so obvious that having a paid out cancelation fee at the at our hotel and just cancel the event, because we were like our partner said, You could do this event and you could have 50 people, you could go from 2500 to 50 people. That's how dramatic it was. And then the final footnote to all that is, you know, there were a lot of fraudsters in the PDP lending spaces. All you needed to start a PDP lending company, you needed to create an app, and you had to pay, like, a $20 licensing fee to your local telecom company. And that's how it worked in China, and you had a business, and there were all these fake borrowers, and it was a lot of fraud happening. The biggest Ponzi scheme outside of Bernie Madoff was a PDP lending platform in China called izba, and but there are lots of other smaller ones. And we, like we would, we was talking with one of our with our Chinese partner just a year or so ago, and he was saying that some of our, many of our 2017 sponsors and attendees and speakers were in jail because they were when we didn't know like we like we didn't we actually easily, we didn't allow them to sponsor or speak, because there was rumors happening during that time and that they were bad, but a lot of these other ones, they'd fooled everybody anyway.

 

Rich Alterman  27:08

The fascinating place is peer to peer still going on in China. Is it totally shut down?

 

Peter Renton  27:12

It's not totally shut down, but it is 95% smaller than what it was at one point. And there's mostly all the serious players. There's some smaller players left but the serious players moved on in kind of like what they did in the US for a lot of it. They just moved to institutional backed funding. It was less, less hassle, and the government was, was okay with that.

 

Rich Alterman  27:37

Well, good. That's a great segue to my next question. And you know, as you mentioned or alluded to, and we certainly both know this, that Lending Club made a decision back in october 2020 to basically shut down their retail platform at the end of 2020 and yet, as you mentioned, you know you continue to work with prosper. What are your thoughts on why prosper did not go down the same path as a Lending Club as it relates to the shutting off the retail investors?

 

Peter Renton  28:02

Well, you know, I was funny. I was just chatting with Scott Sandorn Recently, the CEO of Lending Club, and we were talking a little bit about those that time period. And I don't know if Lending Club didn't want to buy a bank, which, in hindsight, would have been a really smart move for them. They've done much better than the non-bank online lenders in the in the last year or two since interest rates went up, I think Lending Club probably would still have had as it was not, it wasn't a heavy lift. And the thing about the pandemic that I remember when the talking with Lending Club and prosper in the early days of the pandemic, the retail investors stayed. I kept my auto invest. I was just auto investing, and just kept everything going. And they had like, whereas, you know, institutional and bank investors completely shut down, not completely, but a lot shut down. And whereas retailers kept on, kept on chugging along. So, they were a good, reliable source, just a small source of capital. And, you know, Lending Club being much bigger than prosper, it was a much smaller percentage. And so, they didn't, it wasn't a huge deal. I mean, I was personally very disappointed. Like, do you remember that phone call that I had? They were telling me that they were going to do this. And I, you know, that was, I didn't know at the time I was starting a bank, because I didn't share that little tidbit, right? But then we find out a few months, literally, less than six months later, that they're, they're hiring a bank. So that was sort of, I think, the biggest, the biggest impetus, and, you know, and I was talking with prosper a few months back, and they're still committed. So, they say, anyway, they're still committed to their retail investor platform, I think for that reason, because it is very sticky, and it's, it's not a heavy lift. Now they've got, you know, they've got automated, automated investing. You don't, you don't have to use it. But the API, like I used to use with nickel steamroller and. But you can, you know, and then it's, it's a great product. It does mean these days; it does the sort of delta between what you can get risk free and what you can get in PDP lending isn't as wide as it once was. But when interest rates were zero and I was still chugging along at 7% at my prosper and Lending Club investments that was, that was pretty significant. And it's, you know, the 7% has gone up a little, but it hasn't gone up as much as the risk-free rate has gone up right?

 

Rich Alterman  30:30

Okay, well, we're going to take a little, a little detour for a few minutes and kind of step away from the FinTech world, and we'll come back to that. So, you know, as we mentioned, you've been doing your podcast FinTech, 101, since before you started FinTech Nexus. And my understanding is that you've done over 500 podcasts with no, no, no end in sight. And that's quite a number. I know having done, I think I'm up to about 37 Since October, so I don't think I'll ever get to your number. But you know, as a fellow podcast. So, I know we're not supposed to have any favorite guests, but perhaps you can share, you know a few of your other or sure of your memorable podcast that you conducted and what made them stand out? Right?

 

Peter Renton  31:11

Well, just to clarify, we're not officially at 500 yet. I know if you go onto Apple podcast, you'll see that there's more than 500 in there. But some of those things were not podcasts. We used to do a new show that we would publish onto the onto the news feed. We did a few of those. So, the official number right now, I think I'm, I think I'm going to publish it today. It's like 490 so we're very close.

 

Rich Alterman  31:32

But you let us know when you hit your 500.

 

Peter Renton  31:35

Oh yeah, my goal is 1000 so I'm going to keep this going for you know, it's taken me, you know, 11 years to get to 500 so I think in another decade, I'll get another 500 and that's then, then I might retire, who knows, but I want to get to 1000 that's my goal. But so many great episodes over the years, it is really hard to pick a favorite. I will go with. The first name I'll go with is Mike Cagney. I've had him on three times, twice at Sofi, once at Figure each time, he just blows me away. He is, I mean, I think he's, if he's not the smartest guy in FinTech, he's in the top five and just and a great executor, a great salesman, has done incredibly well. You know, with, you know, so far, obviously, you know, massive company that he, that he led for its first, you know, six, seven years of existence and then, you know, with figure, just breaking new ground in technology, what they've done it, figure, I think, is just astounding. And he is always, if you never get a chat to chat with Mike Cagney, you will come away learning something new. I've never I've chatted with Mike over the years dozens of times. Always find I learned something brand new that I've never heard before when I when I talk with him. So, it's fascinating. Other ones, I'll shout out to Max Lev chin. I did him about a year ago, CEO of he was on my, on my bucket list of guests that I've been trying to get on for years. Finally got it done, and he didn't disappoint. He's, again, he might be in the top five smartest guys in FinTech as well, super smart and just the way he thinks so deeply about the payment space and the lending space, and their intersection, which is where kind of a firm plays, and just again, their ability to create partnerships. I mean, they, he did Walmart. He's been a partner of Walmart, like, I don't know, six plus years now, and the company was still relatively small when he, when he got that deal done, and now you got Amazon, and just the amazing, you know, Apple, you've got, like, this company's on the planet, and a firm is in there as a FinTech partner. Really, really impressive, what they're building. Couple others, David Marcus, who people may not even recognize that name, you should. He was the guy that remembered when Facebook were going to launch a digital currency or a digital payments tool, digital wallet. It was what it was called. It was Libra. Libra was what it was initially called, and it went through various names before they ended up shutting it down. It just wasn't going to work politically. But David Marcus was the guy leading that, but Mark Zuckerberg chose him specifically, and he was a former PayPal Exec. I had him on because he's doing something different. He's got lightspark as his company now, and he's doing payments infrastructure on Bitcoin. But forget about crypto, or Bitcoin has nothing to do with the token. It's about the technology that underpins it. And so, it's basically an instant payments network that is Rails, rails that have coming up in, you know, completely separate from the Visa, MasterCard, the Fed rails. It's really interesting company, super, super smart guy. I. I loved interviewing him. Last shout out one I just did fairly recently, Luke voils, one of my favorite people in FinTech. He's the CEO of Pipe. Known him since his days at Square and Intuit. He is just so enthusiastic, so infectious enthusiasm. It was. It was just so fun chatting with him and just seeing what he I think, you know, he's kind of, he's in the vertical, vertical SaaS, revenue-based finance type space, really, really building, I think, unique company there.

 

Rich Alterman  35:32

So, you alluded a little bit to innovation. So why don't we talk about that for a second? What? What do you consider, let's say, the top three innovations in FinTech since you've been involved?

 

Peter Renton  35:44

Boy, there’s so many, I think, great innovations. And I'm going to go with my favorite one, which is earned wage access. That's my number one, because earned wage access, I see as a substitute for the payday lending industry. And I've never liked payday lending. I feel like it's it gets people into a debt, a debt spiral, earned wage access. It's something that should have happened. I mean, if we, if we had started payroll from scratch today, earned wage access would just, would just have been part of the payroll system. Because it's ridiculous that you loan your employer money all the way through when you start work after payday, all the way through the next payday, you are building up a loan. You're giving your employer this free money, and then finally they make you whole at the next payday. It shouldn't be like that. And you know, we, we've got, if you're an Uber driver now, or a Lyft driver, you can get paid after every single drive. That's, I think that's great if you want to, if you want to do that. That's, that's how it should be, and you should be able to choose whenever you want to get paid. And that's what earned wage Access providers. So you're, you're three days before payday, rent is due, or you're or you're out of money, and you can't afford groceries, and you would go down to a payday lender or a check cash or somewhere, or just some, really, you know, a thing that's not going to be good for you financially, and you will, you could potentially Turn a $250 loan into $1,000 repayment, whereas you can just get a $250 advance on money that you have already earned, it is yours. Just haven't received it yet from your employer to earn a wage. Access provides a way to do that. You can do it instantly, usually for a fee. If you can do it, usually, for a day or so, it's free. And so that's a great, a great invasion, my favorite, so in the last 10 years, another one I'll say, is, is BNPL, when I started in, in this space, there wasn't in such a thing, although Klarna had been, was around originally, but then you'd have to pay in a firm started, started up, you Know, more than a decade ago now, but really made this into a phenomenon. I used to notice it now, because I'm from Australia, I go back to Sydney. Afterpay were in Sydney, and they really were, you know, I'd go down to my local, local mall while I was in Sydney, and I'd see all these afterpay signs. So, I had to, I had to find out what it was. And then, then every time I went back, there was more afterpay signs. And then suddenly I went down through the through the mall, and every single company that wasn't just a restaurant or something, every single company that was selling, selling products that cost, like 50 100, $200 every single one had afterpay. So, I saw it firsthand, and then, you know, then it became bigger in this country. And I think consumers love it because we want to, we don't want to. People. Consumers don't love credit card debt, but half, half, have it because they that, you know, for many reasons, mainly because they often can't, uh, can't quite budget the money that they have, or they just don't earn enough money, whereas with BNPL, you're able, you don't pay all that interest. You can just, you can sort of plan your spending in an easier way. And I think that's why consumers love it. And you know, there's going to be, there's going to be regulation come down, and it's going to it's going to mature, but I think it's been amazing because it's just, it's, it's, it's gone from nothing to a preferred form of payment, or a huge chunk of the population it's applied to there.

 

Rich Alterman  39:28

So yeah, so far as regulation right was, I think, May this year, where CFPB issued an interpreter rule, concluding that buyout later on, really a credit card under reg z. So obviously there can be some adjusting there for the industry to,

 

Peter Renton  39:45

yeah, I mean, some, and some have disputed that. Some, some of the BNPL players are on board. There are, I think, significant differences. I think that wasn't, it wasn't as nuanced as I would have liked to have seen. But, you know, it's, it's. Should be an entirely new framework. It is not. There's a lot of things you talk to max legend about credit cards, and he basically thinks that credit cards and payday loans have more in common than credit cards and BNPL and that I then, you know, there's an argument you made for that.

 

Rich Alterman  40:16

but I just gonna say for our listeners, we actually did a big podcast on BNPL with Liz Hagel over at TransUnion a couple months back, and that's when we were talking about all the reporting.

 

Peter Renton  40:27

Yeah. Reporting is key for this to really, really Yeah.

 

Rich Alterman  40:33

So, number three, number three.

 

Peter Renton  40:34

So I would say I'm going to go with cash flow underwriting, very much a lending centric innovation that, you know, when we started in the lending space, we were doing, you know, we were doing, you know, conferences for a while before this really got going. But it's, it was like 2017 I think it was the first time we did a session at one of our events on cash flow underwriting, and no one was in the room because people thought wasn't that interesting. But now it's, it's become, I would say, fairly mainstream, and particularly with open banking and the 1033, rules that are, that are coming. And you know, because basically cash flow underwriting means you need access to the bank, got to get the bank data, and that, and that really is so much more useful than a credit report, which is all backward looking and doesn't actually include income. And so, your bank account includes what you're actually spending your money on right now, and how much you're earning right now. And it's just, it's, it's a way that, I mean, I still, it's still used as a second look for most lenders these days. But I, I think it's, its, yeah, credit, the credit reporting industry is very well entrenched in all in tech lenders, obviously banks as well. But I see cash flow underwriting having more and more of a role, and I feel like it's going to become much bigger and then soon, I mean, I was just talking with, I was talking with a lender the other day on my podcast. I can't remember exactly who it was, but it was arguing for the fact that I want, what I want to see is someone using cash flow underwriting, not for second looks, but for first looks. And that is still not really happening, but it's, I think it's inevitable. It's inevitable. It's going to be because I just think you can do a soft pull on a credit score, you can do cash underwriting together, you're going to get a much broader, much broader segment of customers that you'll be able to apply to. But more importantly, you get much more accurate pricing, and you know exactly what's going on. And I think that's been a great innovation. I thought, when I first organized a session on it in 2017, I thought by now we were further along than we actually are. But it's, it's taken a while, but it's really getting some momentum these days.

 

Rich Alterman  42:56

Yeah, I think the 1033 rule is going to help clarify a lot. It's, there's a lot of discussion there, in there about the requirement, potentially to be a CRA and support, support, adverse action, and certainly from a financial inclusion perspective, right? I mean, there's still 50, 60 million, whatever number you want to pick out. You've heard so many different numbers that are thin, no credit file, and that ability to pull that credit, that bank account, to really help round out and get a 60-degree review.

 

Peter Renton  43:24

And, you know, and the aggregated state or the cash flow underwriting, not enough. All of them are, but many of them are CRA Oh, absolutely, they've already gone through that process.

 

Rich Alterman  43:34

Yeah, more and more are becoming CRAs, if they're not already, I mean, a plan rolled off a separate division, right? That CRA, Inc, I think it is, yep. So, yeah, I think once those rules come out, it'd be good to help clarify things. You know, it's been it’s been an interesting week in this industry with synapse and evolve. So, you know, just to update our listeners, if they're not aware, obviously we had the bankruptcy and Synapse has had a major impact on many consumers on platforms supported by their product and preventing many consumers from getting access to their funds. There's been large discrepancies in asset balances that have raised concerns around vendor Risk Management Oversight processes of their bank partners. And, you know, it's hard not to feel that this is a little bit of a black eye for more than a little, more than a little so you actually published a piece on this. So maybe, you know, let you not distill the thunder, you know, kind of talk about what you focused on. And, you know, what do you see? Long run is this just going to bring that much more, you know, regulation into this space.

 

Peter Renton  44:41

What a debacle. That's why I said in my article, I think it's the worst thing in the history of FinTech, the worst development that we've ever seen. It's a disaster for the 10s of 1000s of consumers that you know you see Horace. I've read many horror movies. Stories of someone with, you know, $38,000 down payment for a house, can't get access to his money, loses the house that he wanted to buy. And, you know, and just people have, people think that they're banking with a FinTech that is doing business with an FDIC, insured bank that should be your money is safe and, and this is where I think synapse, you know, we've got, you got Elena McWilliams running the show now as the bankruptcy trustee, and she's, you know, extremely experienced. But you know, the reality is these people, as we're recording this, they are, they can't get access to their money, and that is just an abomination in in my in my eyes, and so the regulators are going to come down hard. I think it's, it's something that you know, until it gets resolved. And you know that Elena, we were saying, It's like she even put out the one I read, something that Jason Mickleton wrote, and I think she was like wondering whether it's actually resolvable, like maybe the data is not available, which is just staggering to me. And so, you got these people with these accounts, and there's many, many fintechs involved that that were, you know, we're sort of using synapse as an intermediary between their bank and their customers. You see, I'm worked up. I'm mad because I'm mad for the consumers, but the damage done to Fintech is substantial. And, you know, I think there's going to be, I mean, there's going to be ramifications that are going to last a long time because of this, because regulators typically have regulators act in a crisis. They don't often act when they don't have a crisis when they should act, and they typically overreact after a crisis. So, we're probably going to get an overreaction, and it's going to be harder for fintechs to operate.

 

Rich Alterman  46:57

That's bad on the heels of it, I was reading in Forbes, Forbes website, there's an article where the FDIC had issued a new warning to consumers about using neobanks and fintech companies for banking, specifically referring to third party banking apps, non-bank companies offering banking services. And the article actually had a quote from the FDIC saying, you may want to be particularly careful about your place, where you place your funds, especially money you rely on to meet your regular day to day living expenses. Now, I don't know how many consumers that use neobanks for FinTech apps are reading articles related to guidance or statement from the FDIC, but clearly, you know, a statement like this could favor big financial institutions, and perhaps, could it inflict pain on the fintechs impeding. You know, the valuable competition and innovation that they're they brought to the market.

 

Peter Renton  47:41

Sure, it certainly could. And I think, you know, let's face it, maybe point 1% of consumers, I think that's a high estimate, read FDIC guys, and they're just not involved in the banking industry, right? If you remove those people, then, then there's very, very few people that read it. So, I think that, in and of itself, is, is not a big deal, unless you start to get on the front page of The New York Times and on CNN, which has already happened with the horror stories from that was that was happening. It happened in May when this first started breaking. You know, they've moved on to other stories now, but these people are still suffering. And you know the FDIC, this should have, this should have happened. I mean, a long time ago. I mean, there's the reality is that the regulators were asleep, the banks were asleep, synapse was asleep. They did not have all their ducks in a row. And if you know this, this should never have happened. It's not. I mean, to me, you're talking about money movement, a lot of money movement. It's not rocket science to get this right, and it's not rocket science to actually make sure that it is right. Why? Why? When you know a lot of these, lot of these banks are state regulators. So, they don't have the OCC breathing down their neck. You know, they obviously have the FDIC, but the state regulators don't have the don't have the capacity or the knowledge, particularly if you're in, you know, a state like Arkansas, or even, you know, some of the, some of the smaller states that just don't have the manpower that a California or New York banking regulator would have, and all the knowledge and so, you know, they get through their regulatory exams and no big deal like, you know, with, with evolve, with lineage, with, you know, the other banks that have been involved in in in this debacle, where were the banks? How did they get through their exams? And that's the thing that I think you know clearly; synapse was at fault and did many things badly. I don't think there was malicious intent there, but they certainly didn't do things well. Yeah, and, and the people running these, running the, the programs that these banks, didn't do things well, and because it just, it's just, it's, I'm still staggered about it. So, it's, you know, the FDIC was shutting the selling the door after the horse's bolt, yeah. And look, evolve and just have the cyber, cyber-attack. Could it get any worse, like it can get worse because it was just yesterday. I think it was, it feels like two weeks ago, but it was just yesterday that we learned that there has been a data breach that, in fact, it impacted many, many evolve. I think evolution has maybe more than just about anyone else. I mean, the bank corps really prolific, but evolvers had, has a ton of, a ton of clients that are really, they’re now data has potentially been breached.

 

Peter Renton  50:54

I just saw on Twitter, on x this morning, Max Levchin tweeting out that, they know that the affirm card was partnered with evolve, and so there's, there's some exposure there, and they're trying to figure out what's going on. So yeah, a lot you know, lot of, lot of bad things that are happening right now in the in the banking as a service space.

 

Rich Alterman  51:19

But look, you also have the attack on the auto industry right now we're coming up on our time here, so we're going to we're going to probably have to cut some of our questions short. So, what I'd like to do is give you that opportunity. We started our discussion today with the journey from before you were even involved with the FinTech industry and recently rolling out your new company, rented and company. So, I'm going to give you an opportunity to do a little plug for your new company. And how could some of our listeners benefit from the different services that you offer?

 

Peter Renton  51:57

Sure, well, thank you. Thank you for that rich. I appreciate it. Yeah. I mean, this is obviously a new company. You know, when we, I, we dissolved, you know, FinTech Nexus, or we actually declared bankruptcy, to be, to be precise, in that, in the terminology there, I started, you know, I've, I know a lot of people in FinTech space. I've had a lot of people reach out to me, saying, Can you help me with x or y? And so, I thought I needed to form something that is, you know, that can help provide my expertise and help sort of how house my services, so to speak. So, it's Renton, and the code is Renton, and the word and.co that's the website. You there's a Contact button there. You can get in contact with me, and it's just Peter at Renton and CO, as well as the is the email. But I'm sort of, you know what? I love doing it. I love, I love doing media. I love doing podcasts. I love, I love doing events, you know? I love writing, writing newsletters, all that sort of thing. So, I am now available for anybody in the FinTech space or the banking space who wants to up their up their media game, shall we say. And I'm happy too, I already started work with a small number of companies, and happy to happy to take on more.

 

Rich Alterman  53:20

Well, look, this has really been great. Thank you for joining. This is Rich Alterman. We've been syncing up with Peter Renton, CEO of Renton and company, and co-founder of FinTech Nexus, formerly Lend It. Want to thank Peter for joining me today and taking us on your journey in the FinTech industry. On behalf of the financial industry, I want to personally thank you for the positive impact I know you've had on the understanding and the growth of the industry and the personal and professional relationships your events have helped to foster. I know I've met a lot of great people through those conferences and call a lot of those people now friends. Congratulations on your new venture, and we look forward to staying connected to the industry via your podcast and writings. We hope you all enjoyed this podcast, please, please stay connected with GDS Link in the lending link to listen to future podcasts and catch up on the ones you've missed. If you're interested in listening to Peter's podcast, FinTech one on one, you can find them on his website, FinTech one on one.com, and with us, with the numbers spelled out, or on Spotify, or wherever you listen to your favorite podcast. Thank you again, Peter, and that's a wrap.

 

Peter Renton  54:22

Thanks Rich. Really appreciate it.

 

Rich Alterman  54:25

Thanks for listening. If you've enjoyed today's episode, please be sure to subscribe on Apple, Spotify, Google or wherever you listen to your podcast, and be sure to leave us a review. Follow us on LinkedIn and connect with us on Twitter at GDS Link, that's at G D S L I N K. Have a question about the show or have a specific topic you want us to cover, hit the link in the description to drop us a note. Thank you for lending us part of your day. Make it a great one. You.