🎯 Great for Braintree, but bad for PayPal’s gross profit (what matters in payments) Unbranded volume increased from 19% in 2018 to 30% in 2022, while branded declined from 36% to 30% Problem: The declining branded volume accounts for ~70% of PayPal’s gross profit

Toast continues to be a beast

5) @HustleFundVC @will_bricker shares what's happening at the pre-seed stage TLDR: The flight to / premium for traction (as measured by $5k+ revenue) is higher in 2023 than before -- Consistent with the public markets at the other end of the spectrum

3) Carta @PeterJ_Walker has been sharing great charts over the past few weeks and months. Fav recent chart: The flight from late to early stage over recent quarters (Seed + Series A from 21% in Q1'21-> 43% in Q1'23) LinkedIn feed is better than Twitter:

2) @getaumni Aumni helps funds manage their portfolios and therefore sees a high volume of VC transactions. Favorite chart in their recent report: Bridge downrounds on the rise, aka % of converts/SAFEs with lower valuation cap than previous pre-money

4) Funds sharing proprietary data like @loganbartlett's recent deck: Fav chart: A sign of how the private lags the public market, the spread between public and private market SaaS multiples (observed by Redpoint) peaked in 2022 at over 5x.

1) Cooley Cooley is one of the top VC law firms and sees hundreds of transactions each quarter. They're sharing data on median valuations but also more nuanced insights like drag along rights and liquidation preferences.

The private markets are characterized by (public) data scarcity. PitchBook and CBInsights are probably the most cited data sources in venture. But there are more interesting ones that often use proprietary data. Some favorites I've come across over the past weeks and months:

An important question for future research is whether BNPL improves the financial health of consumers in distress or exacerbates these differences."

..and use high-interest financial services such as payday, pawn, and overdraft compared to non-BNPL borrowers. They are more likely to also have traditional credit products like credit and retail cards, personal loans, and student loans..

CFPB: "While many BNPL borrowers who we observed used the product without any noticeable indications of financial stress, BNPL borrowers were, on average, much more likely to be highly indebted, revolve on their credit cards, have delinquencies in traditional credit products..

.. but have lower liquidity and savings compared to non BNPL borrowers. However, markers of financial distress were apparent for these consumers even prior to the widespread usage of BNPL starting in 2019.

Consumer Financial Protection Bureau (CFPB) puts % of Americans that use BNPL at 17%, not 46% like LendingTree.

Concerning: - ~50% of Americans say they've used a BNPL service - Of those, 46% say they use the loans as a bridge to their next paycheck, and 21% say they’ve used the loans to buy groceries

Another recent study: "In the first two months of 2023, groceries’ share of BNPL orders grew a staggering 40%, while home furnishings grew by 38%. By contrast, apparel only grew by 8%, and electronics fell by 14%."

Coopetition: PayPal's partnership with Apple Pay went live today after years of partnering with Apple Pay on the Braintree side, but also competing "head-to-head with Apple every single day"

Two banks positioning themselves in VC space this week: First JPM acquiring @getaumni, now Stifel: Stifel hires senior SVB leadership as managing directors to expand its banking offering for VC-backed companies. Stifel also offers fund banking.

.. what their underserved user base would have to pay for alternative products (payday loans, high account fees etc.). Plus, fintech companies (Chime, Cash App etc.) are able to offer their services and drive financial inclusion because their ability to generate such revenues.