Panic with Friends – Investing for Profit and Joy
I’m excited to bring one of my favorite guests back for his second round of Panic: Yoshi Yokokowa, founder of Alpaca, a Social Leverage Fund III portfolio company. Coming to you all the way from Japan, Yoshi is here to talk fintech, the stress of a recap, and the stress of losing momentum at an early stage. And to all those founders out there listening, we don’t talk about recaps or losing momentum much because it’s not fun. But people pricing their companies to perfection in the first year, should be careful what they wish for; things can and do go sideways.
You can listen to the podcast here on Spotify or Apple podcast and now all the episodes are on my YouTube channel as well.
You can also listen right here on the blog:
Guest: Yoshi Yokokawa
Profile: Founder, Alpaca
Where to Find Him: LinkedIn, Twitter
What’s Yoshi Panicked About?: Howard’s love of sushi
Previous Appearance:
Yoshi Yokokawa (October 4, 2020)
The Takeaway:
Building a fintech company is constantly having to think 10 steps ahead, both from a legal compliance and tech standpoint, and keeping up with where the markets are heading. One of the most surprising things happening during COVID though was the extreme tailwind which created massive velocity. Not only for the early-stage startups, but for the growth stage companies as well. Lots of companies went IPO, forcing the industry to think bigger and more outside the box in order to grow faster. So many companies benefited by being in the tailwind; Robinhood, Coinbase, Alpaca, FTX, Square, and Paypal to name a few. But the air is out now in the public markets. These disruptors who were supposed to take out Schwab Visa and Mastercard took ‘the great round trip’ and are now basically trading where they were a few years ago. If anything, the tailwind seems to have helped the incumbents.
But the whole round trip has two directions. People are still excited about the capital markets and there’s actual progress in building the pipes that connect the people with the capital markets. We’re experiencing evolution and advancement of our whole human race. Borders are being lowered. Cross-border country pipes are being built. We need to focus on building instead of where prices are in the short term. Great builders love the volatility because it doesn’t affect building right. During times like this you’ve got to pick up the phone, talk to people, close business –because it’s all you can do to move the needle. Keep banging out code and making the pipes better. Lower the entry so the next wave of investors gets better fills, better pricing, and better access.
Show Notes:
- (00:39) – Show intro
- (04:50) – Introducing Yoshi
- (05:46) – Quick summation of Alpaca
- (08:44) – A distributed global workforce
- (10:32) – Extreme tailwinds in the fintech industry
- (11:46) – The “Great Round Trip”
- (13:14) – A macro bet on owning the stack
- (14:40) – Disrupters, incumbents, and wallet share
- (17:10) – Not everybody gets a balloon and lollipop
- (19:08) – Transparency and how things work
- (19:45) – Open source. Like water/public utility
- (22:02) – The ‘sameness’ of financial services
- (22:14) – Leveraging information asymmetry
- (23:36) – Advice to Robinhood
- (24:12) – Understanding your customers
- (24:56) – Laying some digital pipe
- (26:48) – Advice to fintech founders
- (32:34) – Filling the gap for certain regions
- (37:03) – Creating more convenience peer-to-peer
- (37:48) – Keeping up with fintech trends
- (42:06) – Closing thoughts
