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How’s it going, everyone? Today, we’re covering the podcast interview Lincoln Archibald had with Carey Ransom from BankTech Ventures: Investing in community banks!
BankTech’s website says, “We identify and invest in the leading bank technology companies, and are deeply entrenched in community banking to make sure the companies work effectively with our banks to deliver maximum value and impact.”
Let’s dive into the interview!
Carey Ransom on BankTech’s Mission
Lincoln: Give us the elevator pitch for BankTech.
Carey: BankTech Ventures is a strategic investment fund for the community banking industry. With a fund of more than 100 banks, we identify the next generation of technology solutions that can make banks more relevant, efficient, and competitive. We work with community banks because they are such an important part of our economy: During covid, they gave out most of the PPP loans that kept small businesses in business. We recently closed our first fund in August 2022 with $115M!
The Role of Community Banks in BankTech
Lincoln: Are your LPs primarily banks?
Carey: They are made up of entirely community banks. We have 110 community banks in 33 states.
Lincoln: I started my career at a community bank and the technology was terribly outdated – it’s good to hear that you’re striving to change that! So, you’ve been under operation for about 2 years now, are you looking for new and undiscovered technologies to implement, or are you trying to improve the current tech?
Carey: Because of the conservative nature of banks, we do more to improve upon current technology. Banks do not tend to pursue “shiny object tech” that other industries might. As a community bank, they look at an investment in BankTech Ventures as part of their innovation and R&D.
The Value Proposition for Community Banks
Lincoln: Do your LPs invest in your fund because they know they’ll get a return, or is it more for the cause and potential benefits they can reap from the investment?
Carey: Primarily, it’s the latter. It’s about intelligence and understanding with the dual benefit that if the fund works out right, they’ll get a good return. And 2 years in, we can already see it happening in front of us! We are well into positive return territory. If we find the right companies that are useful to community banks, then that creates more value for not only the bank, but for us too because we are invested in those tech businesses.
Conclusion
That’s all we’re covering today from this insightful interview, but to hear more about the impact of BankTech Ventures and their approach to investing in community banks, check out the full episode on the “Funds that Won” podcast. This is a fresh take on venture capital, focusing on the often-overlooked community banking sector.
If you’re interested in starting your own venture capital fund, visit Fund Launch for expert guidance and resources.
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DISCLAIMER: This content is for educational and informational purposes only. It is not to be taken as tax, financial, or legal advice. You should always consult a legal professional before taking action. Furthermore, this is not a recommendation to buy or sell any security. The content is solely just the opinion of the authors.
