According to Dee Choubey, CEO of MoneyLion, being in the public markets means that executives experience the volatility inherent in their stock values every day.
But, the same volatility should encourage discipline in how they operate their enterprises and disclose their success to the general public.
He stated that the fallout from the downfall of Silicon Valley Bank (SVB) will be felt worldwide.
Even if a company had no deposits with the bank, he added, it was possible that it had handled payments through SVB — and MoneyLion had done so in the past.
“One of the tragedies is that they had a very good payments processing company,” said Choubey.
But, the gyrations, which predate the recent news, have obscured excellent underlying business fundamentals.
In what appears to be evidence of the wide brush that investors have been utilising in the markets: MoneyLion went public two years ago at a $2.4 billion valuation, when revenues were $76 million; as of Tuesday, the market worth was $160 million, despite 12-month sales of $340 million, nearly tripling from 2021 levels. The stock is trading at a fraction of its top of over $12, which it reached in the years after its introduction in September 2021.
Yet, as Choubey stated, there are tendencies that will persist long after the present concerns about startup funding, stock returns, and bank bailouts have gone.
“A significant slice of the US populace funds themselves on a weekly basis,” he told Webster. And the platform model, which delivers embedded financial markets and products with data at its core, has the potential to produce value for both individual and business clients.
As Webster pointed out, the main lesson to be taken from the SVB fiasco inside finance is that customer concentration (and very few lines of diversification) leads to a dangerous business model.
Choubey, on the other hand, observed that MoneyLion’s app, as outlined in its investor papers from Tuesday’s results release, provides a plethora of monetizable prospects, ranging from direct deposit and cash advances to third-party offers for insurance and loans.