SaaS Interviews with CEOs, Startups, Founders

653: She Invests $120 Million Into Financial Tech Companies, 39 Graduates, 6-8 New Per Year with New York Partnership Fund CEO Maria Gotsch

08 May 2017

23 min

4211 words

2 speakers

08 May 2017

Audio

Description

Maria Gotsch. She's the president and CEO at the Partnership Fund for New York City, which is the investment arm of the Partnership for New York City. In addition to leading the funds operations, Maria has spearheaded the creation and operation of a number of fund strategic initiatives including The Fintech Innovation Lab. Prior to joining the fund in 1999, Maria was a managing director at a company that is now part of Deutsche Bank, providing strategic and financial advice related to mergers, acquisitions, dispositions, joint ventures and the development of business strategies. Maria worked for LaSalle Partners in the New York area and Merrill Lynch Capital Markets, in both New York and London. She graduated with an MBA from Harvard Business School and a BA from Wellesley College. Famous Five: Favorite Book? – "A book on the Iranian negotiations with the US around the treaty" What CEO do you follow? – Henry Kravis Favorite online tool? — MyCity Bike app How many hours of sleep do you get?— 7 and a half If you could let your 20-year old self, know one thing, what would it be? – "Be bold, be bold, be bold!" Time Stamped Show Notes: 01:11 – Nathan introduces Maria to the show 02:15 – Partnership Fund is the corporate sector at the table that is trying to grow the NYC economy 02:21 – Henry Kravis of KKR has raised funds in the late 90s and raised from major corporations and individuals, in NYC 02:32 – The investor list is the "who's who" of the private equity 02:36 – Partnership Fund was structured as an evergreen fund 02:48 – "We can do things that are a little bit riskier and take a little bit longer than a traditional private sector investor" 03:02 – "We often work with government, but we're privately funded" 03:13 – Partnership Fund is like an interest-free loan for 45 years 03:33 – All of Partnership Fund's gains just go back to their funds and they reinvest it 03:41 – "We have the investors' money for 45 years and if we make returns, it comes back to us to fund new projects" 03:58 – The Fintech Lab is currently in their 7th year and has 75 graduates 04:08 – It is an elite program and takes 68 companies a year 04:18 – It is structured as a civic program 04:32 – The goal of the program is to help reduce the pain and agony of a small emerging company trying to get into and get attention from large financial institutions 05:06 – "Because it is competitive to get in, it's a shark tank to get in, but once you're in, it's a dolphin tank" 05:18 – They get 150-160 applications a year 05:28 – Companies are selected by their financial institution partners 05:34 – A company's technology has to rise to the level of addressing a major pain point for major financial institutions 06:10 – In some cases, it's not about an acquisition, it's about using 06:15 – The fact that they are a non-profit civic organization is important 06:29 – CTOs and CIOs will come to the table as a civic program, partly to help grow the fintech community in NYC, to create jobs 07:23 – They invest in some of the graduates' post programs 07:30 – The lab is laser-focused in solving problems 07:41 – They are not doing any direct-to-consumer programs 08:20 – The big 3: data, security and risk management have been on the top of the CIOs list from the beginning 08:43 – However, new things are coming 08:47 – Disruptive talent management has been added as a new category 08:58 – Blockchain has gone through an interesting cycle 09:14 – This year, there's much less interest in blockchain and distributed ledger 09:52 – Maria predicts that in 2 years, there will be an increase of interest in enabling technologies that fit around the distributed ledger 10:31 – In data, Digital Reasoning came into the program with an interesting technology that is able to read unstructured data, and they're working for the government 11:03 – They were advised to focus on compliance 12:04 – In security, Centripetal Networks has a perimeter defense technology and they're gaining traction from people who have a lot of retail locations 12:34 – In risk management, Quarule automates some of the processing of regulatory tracking and flagging operations against the regulations 13:23 – In blockchain, Digital Asset Holdings has raised a significant amount of money and has been involved in some major projects 13:50 – Maria shares how they are telling companies to create more jobs in NYC 14:02 – The companies will also realize that they need to have people on the ground in NYC 14:20 – Some have moved to their headquarters in NYC 14:46 – "We've not raised money since the late 90s" 14:50 – The initial fund size was $120M 15:46 – New York is starting to be seen as a center for fintech 16:34 – There are some smaller companies that are trying to go after pieces and as they scale, the acquisition cost is increasingly expensive 17:05 – LearnVest is a good example 17:40 – The small business lenders come to a market that the banks aren't servicing 18:00 – There are companies who are an exception to the rule 18:17 – Most of the companies end up partnering with large institutions 18:54 – What the large financial institutions have is expertise and compliance 20:10 – The Famous Five 3 Key Points: The trend in the fintech space is constantly changing. Creating more jobs in New York City means more opportunities for companies and for the people of New York. Be BOLD—don't shrink, don't hesitate—just go for it. Resources Mentioned: The Top Inbox – The site Nathan uses to schedule emails to be sent later, set reminders in inbox, track opens, and follow-up with email sequences Organifi – The juice was Nathan's life saver during his trip in Southeast Asia Klipfolio – Track your business performance across all departments for FREE Acuity Scheduling – Nathan uses Acuity to schedule his podcast interviews and appointments Host Gator– The site Nathan uses to buy his domain names and hosting for the cheapest price possible Audible– Nathan uses Audible when he's driving from Austin to San Antonio (1.5-hour drive) to listen to audio books Freshbooks – Nathan doesn't waste time so he uses Freshbooks to send out invoices and collect his money. Get your free month NOW Show Notes provided by Mallard Creatives

Chapters

1. What is the main topic discussed in this episode? 2. What is the Partnership Fund for New York City and its mission? 3. How does the Fintech Innovation Lab support emerging companies? 4. What are the main challenges fintech startups face in NYC? 5. What key trends are shaping the fintech space today? 6. How does the Partnership Fund reinvest its gains? 7. What role do large financial institutions play in the fintech ecosystem? 8. How does the Partnership Fund create job opportunities in NYC?

Featured

Nathan Latka

Maria Gotsch

Transcription

Chapter 1: What is the main topic discussed in this episode?

0.031 - 9.02 Nathan Latka

This is The Top, where I interview entrepreneurs who are number one or number two in their industry in terms of revenue or customer base.

Chapter 2: What is the Partnership Fund for New York City and its mission?

9.521 - 19.391 Nathan Latka

You'll learn how much revenue they're making, what their marketing funnel looks like, and how many customers they have. I'm now at $20,000 per talk. Five and six million.

Chapter 3: How does the Fintech Innovation Lab support emerging companies?

19.411 - 34.907 Nathan Latka

He is hell-bent on global domination. We just broke our 100,000-unit soul mark. And I'm your host, Nathan Latka. I just finished traveling Southeast Asia for 41 days, and I usually always get sick when I travel, and quite frankly, eating is difficult for me.

Chapter 4: What are the main challenges fintech startups face in NYC?

34.927 - 38.27 Nathan Latka

It's hard to find a restaurant, and I'm spoiled in Austin with my personal chef.

Chapter 5: What key trends are shaping the fintech space today?

38.35 - 51.742 Nathan Latka

Well, I took these little packets with me this time, 30 of them, in my carry-on suitcase. They kept me totally healthy with 11 different secret ingredients. You can see them at nathanlaca.com forward slash juice. I'll tell you more later on in the show.

Chapter 6: How does the Partnership Fund reinvest its gains?

51.923 - 72.073 Nathan Latka

That's nathanlaca.com forward slash juice. This is episode 653. Coming up tomorrow morning, you're going to learn how Dale made $100,000 at the very young age of 19. Now he's made $1.2 million from 16 best-selling books and a new app that he's launching. Good morning, everyone.

Chapter 7: What role do large financial institutions play in the fintech ecosystem?

72.093 - 81.785 Nathan Latka

My guest this morning is Maria Gott. She is the president and CEO at the Partnership Fund for New York City, which is the investment arm of the Partnership for New York City.

Chapter 8: How does the Partnership Fund create job opportunities in NYC?

82.225 - 93.218 Nathan Latka

In addition to leading the fund's operations, Maria has spearheaded the creation and operation of a number of the fund's strategic initiatives, including the FinTech Innovation Lab, among many, many others.

93.198 - 107.157 Nathan Latka

Now, prior to joining the fund in 1999, Maria was a managing director at a company that's now part of Deutsche Bank, providing strategic and financial advice related to mergers, acquisitions, dispositions, joint ventures, and the development of business strategies.

107.638 - 122.698 Nathan Latka

Before starting work there, Maria worked at LaSalle Partners in the New York area and for Merrill Lynch Capital Markets in both New York and London. She graduated with an MBA from Harvard Business School and a BA from Wellesley College. Maria, are you ready to take us to the top?

122.797 - 123.478 Maria Gotsch

Absolutely.

123.799 - 135.117 Nathan Latka

All right. Let's talk. So I'm looking forward to this specifically focused on fintech. But before we go into fintech specifically, this is the first time I've really talked to someone. I believe this is a government role. You're right. You're operating on government funds.

135.617 - 158.005 Maria Gotsch

No, we're we are the we are the corporate sector at the table to try to grow the New York City economy. So Henry Kravis of KKR raised the funds in the late 90s. And he raised them from major corporations in New York, as well as individuals. So if you look at our investor list, it's sort of the who's who of private equity, as well as the corporate sector. We're structured as an evergreen fund.

158.085 - 180.538 Maria Gotsch

So the investors put up the money not to make a financial return, but to try to create jobs and expand the economy in New York City. So it's a very unusual structure. And it means we can do things that are a little bit riskier and take a little bit longer than a traditional private sector investor, but always with the sort of tap on of how is it helping and growing the New York City economy.

181.139 - 183.923 Maria Gotsch

We often work with government, but we are privately funded.

184.383 - 192.493 Nathan Latka

Now, Maria, taking that down to an actual kind of business setup level, I mean, are you structured as a 501c3? Is this a write-off for the investors or no?

SaaS Interviews with CEOs, Startups, Founders

653: She Invests $120 Million Into Financial Tech Companies, 39 Graduates, 6-8 New Per Year with New York Partnership Fund CEO Maria Gotsch

Chapter 1: What is the main topic discussed in this episode?

Chapter 2: What is the Partnership Fund for New York City and its mission?

Chapter 3: How does the Fintech Innovation Lab support emerging companies?

Chapter 4: What are the main challenges fintech startups face in NYC?

Chapter 5: What key trends are shaping the fintech space today?

Chapter 6: How does the Partnership Fund reinvest its gains?

Chapter 7: What role do large financial institutions play in the fintech ecosystem?

Chapter 8: How does the Partnership Fund create job opportunities in NYC?

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SaaS Interviews with CEOs, Startups, Founders

653: She Invests $120 Million Into Financial Tech Companies, 39 Graduates, 6-8 New Per Year with New York Partnership Fund CEO Maria Gotsch

Chapter 1: What is the main topic discussed in this episode?

Chapter 2: What is the Partnership Fund for New York City and its mission?

Chapter 3: How does the Fintech Innovation Lab support emerging companies?

Chapter 4: What are the main challenges fintech startups face in NYC?

Chapter 5: What key trends are shaping the fintech space today?

Chapter 6: How does the Partnership Fund reinvest its gains?

Chapter 7: What role do large financial institutions play in the fintech ecosystem?

Chapter 8: How does the Partnership Fund create job opportunities in NYC?

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