How A Local Pharmacy Evolved Into An Industry Disruptor
The history of the pharmaceutical industry can be traced back almost 4000 years to Mesopotamia (now a region of Iraq), where the first recorded prescriptions were etched on clay tablets.
It’s safe to say that you’re probably familiar with the traditional model of a bank at this point in time, right? What about a “neobank?” Is that something entirely new to you? It should be! And in fact, there’s a new neobank that has recently been making waves throughout the country because it’s providing mainstream consumers with a new mode of acquiring a loan, building credit, and borrowing money. Today, we’d like to introduce you to Upgrade – a neobank that delivers credit to mainstream consumers.
Upgrade is a neobank that offers affordable and responsible credit to mainstream consumers. Designed to make lending simpler, more equitable, and more seamless for mainstream consumers, Upgrade is poised to revolutionize not just the fintech industry, but the banking industry as a whole. Founded by the French expert, Renaud Laplanche, who also founded LendingClub, Upgrade is a credit-based banking platform. When speaking about Upgrade in a podcast with Tearsheet, Laplanche says, “in terms of targets, when you start with credit, you do a lot more underwriting. You choose your target market differently for that reason. So, you start with customers that are creditworthy. Our customers are probably more mature than other challenger banks. Upgrade customers are 42 years old on average with a 700 credit score and a household income of $130,000.” In building on that, he goes on to say, “unlike other challenger banks, we’re not focused on Millennial customers or other populations that haven’t adopted traditional financial services. We’re focused on more mainstream, mature customers who often bank with Wells Fargo and Bank of America. We offer a better experience, a better deal, and more affordable and responsible credit products.” This is an important point to consider. According to Laplanche, the Millennial generation isn’t exactly keen on the idea of banking. After all, Millennials are one of the most indebted generations to ever life – mostly bogged down by student loans. At this point in their lives, they’re probably not exactly concerned with big banks like Wells Fargo and Bank of America. However, the generations that came before them were almost institutionalized into believing that these banks were the one and only way. Upgrade is poised to challenge that idea, to provide a new avenue for mature customers to acquire credit, and to introduce this middle generation that the world of fintech is alive and well, and that it’s potentially even more beneficial than they may have originally thought.
Upgrade touts itself as offering a number of benefits strictly due to the fact that it’s a credit-led neobank. With that said, Upgrade is able to offer a branch-less network, moving the banking model entirely online. They’re able to offer a modern technology architecture, and a lower cost of capital. All of these translate into important consumer benefits like better value, more responsible credit, and a tremendously successful user-experience. Upgrade’s Net Promoter Score (NPS) currently stands at 79 while the average in the banking industry is 15. For comparison, Apple’s NPS is 72.
Upgrade is participating in a market with huge potential. Due to its mainstream focus, it enables the company to tap 93% of the US population or over 300M potential customers. Also, 170M Americans use credit cards, which is a huge addressable market for Upgrade’s “Upgrade Card” product. And it is not only the potential, but Upgrade is also clearly ahead of the pack after its third year of existence and has been growing revenues at a rapid pace, much faster than Salesforce, Netflix, eBay, Airbnb, Spotify, Revolut or Uber, to name a few. Continuing margin expansion combined with fast revenue growth (4x compared to the prior year’s quarter), plus a world-class investor base, will likely make the unicorn a “decacorn” (>10B valuation) soon.
If you’re interested in learning more about participating in the Upgrade success story, then it’s time to get in contact with us. Getting access to late-stage deals such as Upgrade is usually only reserved to the 1% top-institutional investors of this world, so we are extremely proud that we have been able to source this access for you.
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