Over the last 20 years, the trend among financial tech startups has been to vilify and denounce the traditional banking model. Companies like Lending Club and and OnDeck have explicitly rejected the traditional lending role, instead trying to create parallel systems that are able to better meet the needs of both lenders and borrowers.
But of those companies have struggled to stay afloat. David Zalik, the founder and CEO of GreenSky, had a very different idea about how to create value within the fintech sector. Rather than trying to burn the banking system to the ground through disruptive technology, Zalik embraced the world of traditional banking, using technology to eliminate frictions and create value for banks, merchants and customers by facilitating deals that would have otherwise fallen through.
This model has proven to be enormously successful. Within just 12 years, Zalik has been able to grow GreenSky from a startup that he funded by taking out a reverse mortgage to a company worth more than $4.5 billion. GreenSky is now poised to make its initial public offering, a move that analysts say could make it one of the best opportunities for IPO investors this year.
GreenSky has an incredibly simple yet hugely effective business model. The company started by helping home remodeling contractors extend credit with generous terms to customers, helping to facilitate many deals that would have otherwise fallen through due to the customer underestimating the true cost of the project that they wanted to complete.
Zalik quickly saw that this model could be replicated across many different sellers of big-ticket items. Today, GreenSky has over 17,000 merchants who are able to connect with 12 of the largest lenders in the country, including Region’s Bank, Fifth Third and Sun Trust. These merchants are able to offer customers truly amazing loan terms at the point of sale, often involving no payments and no interest for 12 months. Because the majority of the customers have extremely strong FICO scores, almost all of these loans are paid back before the higher rates kick in. And the banks who make the GreenSky-facilitated loans almost never contend with delinquencies.
Do only people who work on Wall Street know how to make a lot of money from investments? Simply looking at wealthy and secure people living on Main Street U.S.A. reveals the answer. Working on Wall Street doesn’t automatically mean exclusive success from investing. The average person with no financial connections can put money away in decent savings investments. No matter where you live, you must educate yourself about finance, saving money, investments, and retirement planning. Looking at informative resources helps with this cause. Visit the website paulmampillyguru.com to learn more.
The material at Banyan Hill Publishing overseen by Senior Editor Paul Mampilly tries to help those seeking informative content. Banyan Hill Publishing produces a number of newsletters edited by a variety of experts. Mampilly worked as an author and analyst at a number of different financial companies. Today, his focus as a Senior Editor at Banyan Hill Publishing centers on assisting the people who live on Main Street. It wasn’t always this way for Paul Mampilly.
Mampilly once served as a portfolio manager on Wall Street. His notable achievements included running a hedge fund for Kinetics Asset Management. During his tenure with the company, Mampilly helped assets grow upwards of $25 billion. His days on Wall Street came to a close. Now, he serves as a research and investment analyst. Watch videos on Paul’s Youtube channel.
Mampilly seems more interested in helping the average person make money. Over the years, Mampilly developed a great deal of knowledge about investing and finance. Through his newsletter writing and editing, he channels that knowledge to persons interested in learning. Paul Mampilly heads the intriguingly named newsletter “Profits Unlimited.” The newsletter looks at stocks, portfolios, and investment opportunities in each issue. The newsletter gives readers something to think about with each issue.
Paul Mampilly wants to share his knowledge. During his Wall Street career, his knowledge was only available to the small group of investors and professionals he dealt with. In his new career, Mampilly speaks to a larger audience. Perhaps this new audience feels more appreciative of his giving nature.