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Building companies takes time. Fintech is a long road.
In a world of AI, there are expectations and examples of startups hitting $100m in revenue in the first 12 months. Should this be the expectation, or is it rare? I am in the camp that it is not reality. Yes, for some AI companies or unique businesses, it’s possible, but for very, very few. Some companies need to go for it, grow at all costs, be the category winner, or they won’t survive. But for most others, building a good, successful business takes time, pivots, and survival.
For fintech, most fintech companies take a long time. The infrastructure takes a long time to build. The regulations, licenses, and laws tend to drag out timelines and are not easy to acquire or meet; the partnerships, especially with banks, are a long process, and building trust, like in many industries, is something that takes time, lots of it.
If I look at Social Leverage portfolio companies where we invest in the seed stage; $HOOD ( ▲ 4.68% ) took 9 years to go public, $ETOR ( ▲ 0.57% ) was over 12 years, Alpaca.markets is from our 2018 vintage Fund III, Street Context took 12 years to get acquired by Blue Matrix, & SecFi is from our 2018 Fund III. There are lots of other examples across our portfolio, but also across all of the fintech ecosystem.
Sometimes it’s about surviving, staying alive, and building for the long haul. It’s hard building a startup; fintech is no different.
Don’t Wait for the OpenAI IPO
OpenAI and Anthropic could be two of the biggest AI IPOs Wall Street has seen in years.
But investors don’t have to wait for those names to hit the public markets to get exposure to the AI boom.
MarketBeat’s 7 AI Stocks to Buy Now report reveals 7 publicly traded companies already positioned to benefit as the next wave of AI investment moves beyond the private model providers.
These are the stocks investors can buy today, before the IPO crowd rushes in.