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Sbanken 💔 DNB

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This week in fintech

November 22 · Issue #82 · View online

A weekly summary of the latest news in our world of finance, design, and technology.


Also this week:
  • 🤳 BankID identity-check
  • 💪 The power of DAOs
  • 🔊 Branding and rebranding

Sbanken 💔 DNB
Half a year after DNB said they wanted to buy Sbanken, the Norwegian competition authority stopped the merger. The reason? The acquisition will weaken competition in the market for savings in funds. This is a surprising conclusion considering Sbanken has a market share of ~8% of fund distributions in Norway. And savings in funds is only ~3% of the total volume of Sbanken. Last week I wrote about the importance of design. In Sbanken’s case, their profile and communication as a challenger to the traditional banks might be the main reason this acquisition was stopped. If we remove that part of the equation, it’s hard to imagine the acquisition not going through smoothly.
The future of Sbanken is still uncertain for three reasons:
  1. Sbanken must hold 75% more equity behind each mortgage than IRB-banks like DNB. If an IRB-bank buys Sbanken and consolidates their balance, they immediately get a nice return on their investment.
  2. Altor, a PE company, owns ~25% of Sbanken and has an exit strategy that they pursue aggressively. They will not stop because of this roadblock.
  3. The door has been opened. The door of selling has now been opened, and won’t be closed before another buyer is standing at the doorstep.
So who will the next buyer be? Nordea? Danske Bank? Or will we see the entry of a foreign bank? The funniest twist of this saga would be if Skandia bought back their daughter after being separated for 7 years.
🤳 BankID identity-check
BankID has launched a solution for ID checks on your mobile, with passport and face analysis. This means that you do not have to show up physically to prove who you are. This is interesting news considering the new finance agreement law possibly has new requirements for additional solutions to ensure that the right person actually signs.
💪 The power of DAOs
This week, the biggest news in decentralized finance is that a DAO ( decentralized autonomous organization) organized to purchase a copy of the United States Constitution at an auction at Sotheby’s. Together they managed to collect over $40M to buy the document and publicly display it. The contributors to the DAO receive a governance token, not fractionalized ownership of the paper as you could have thought. This is a powerful example of what decentralized finance can do in just four days (!?!). Setting this up as a traditional Kickstarter campaign or similar would not be possible the same way or timeframe. Unfortunately their bid didn’t go trough in the end, but it is still an impressive feat. so the bidders can reclaim their money. This also shows the power of smart contracts and open wallets: The money automatically returns to their wallet if the bid doesn’t go through. Packy McCormick has written more about the case here
Speaking of open wallets: Imagine if owning a .com domain name from Godaddy resulted in you getting shares in Godaddy. Sounds crazy? The Ethereum Name Service (ENS) acts like an email address or URL for wallets, and this week, they airdropped tokens to all the accounts registered with the service. This can be done because which wallet has which token is public record. This means software developers can add new functionality for a token holder whenever they want. In the case of ENS, all token holders got to vote at their “general meeting.” But you could quickly build on that idea: imagine if you got an exclusive song from your favorite artist because you attended their concert. Or that a company distributed back some of their profit to their buyers over the last year.
Decentralized finance provides a business model for things that wouldn’t and couldn’t get built before. This way, global cooperatives can be created with new incentives to solve different problems. Simon Taylor from 11:FS is very excited about the future of finance in this long rant about “magical internet money.” Chris Dixon and Packy McCormick have also written about the promise of web3 in the latest issue of The Economist.
🔊 Branding and rebranding
A couple of weeks ago, we talked about Facebook’s new brand identity. They have also launched their new company brand for Meta. Their logo is apparently drawn in 3D using their Quest technology, which is an interesting new way to approach branding.
Another interesting approach to branding is Speedy, a digital banking app that lets you upload and send customized invoices and get paid. Head over to their site to see their fun interface.
Over the last several years, Goldman Sachs has methodically built out their consumer-facing value proposition under the Marcus brand. Now they are rebranding Marcus from “Marcus by Goldman Sachs” to…. “Goldman Sachs Marcus”. The reason? After interviewing thousands of customers, Goldman found that they had a strong brand affinity with the name “Goldman Sachs.”
That's it for this week 👋
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Marius Hauken, partner Stacc X
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