
Fintech is awesome. Think of how much has changed around the world that has been impacted by the world of Fintech startups — it is no small feat.
Whether you know it or not, the company that powers many of these Fintech startups changing the world is Plaid.
Plaid, based in SF, created an API that allows users to link their bank account to their Venmo, Robinhood and Coinbase accounts. Pretty simple concept, but it works and works well. Visa decided to acquire Plaid last week for $5.3 billion dollars.
In local news, Birmingham is growing into its own little startup hub in the southeast. In order to continue to grow, it needs capital (which it lacks a lot of ).
Good news, though: Birmingham can count on the new arrival of Black Girl Ventures to help bridge the funding gap for founders, particularly for African American women.
The Macro

As I mentioned, Plaid was acquired by the good folks over at Visa recently in a $5.3 billion transaction that made a lot of rich people richer and a lot of smart people, well, rich. Plaid was one of those Fintech startups that seemed to fly under everyone’s radar. In the news, it was often overshadowed by the fintech companies it powered such as Robinhood, Acorns, Venmo, and Coinbase.
The concept is pretty simple. Here’s how it worked:
“To understand how the banks fit in this network it is important to understand what exactly Plaid does. Many banks in the U.S. do not have APIs (Application Programming Interfaces) that offer a programmatic means of accessing a particular account; those that do are not consistent with each other in either implementation or in features. Plaid gets around this by effectively acting as a deputy for consumers: the latter give Plaid their username and password for their bank account, and Plaid utilizes that to basically log in to a bank’s website on the user’s behalf.”
That’s it. It simply created an API that logged into your online bank account for you using screen scraping. So if it’s so simple, then why was it so valuable and why did Visa buy it?
The Network. Take it from Visa themselves, who kindly shared their presentation with the public as to why they purchased Plaid

Plaid was simply the best at connecting the consumer, the bank and Fintechs.
Takeaway: Build a simple yet incredibly useful product, attract a massive network, print money.
Shout-Out: Visa. I think in the long run this will make out to be one of the best acquisitions of all-time (Instagram and Youtube hold that title currently). Shout-out also to the dream team of VC funds that backed them: Spark Capital, NEA, Index Ventures, Kleiner Perkins and GV.
The Micro

It’s an exciting time to be a startup in Birmingham. The landscape right now is promising: tons of growth, access to resources and a vibrant city that’s affordable to live in. One bottleneck really remains — capital has been hard to come by for many founders based in the city. This roadblock is even more difficult for women and women of color.
That’s where Black Girl Ventures comes in. Black Girl Ventures’ mission is to create access to capital for Black and Brown female founders. Considering that less than 2.2% of venture capital goes to women and less than 1% goes to women of color, Black Girl Ventures is going to help bridge that gap by democratizing access to capital in 12 cities across America.
Black Girl Ventures organizes and puts together crowdfunded pitch competitions (where the audience decides who gets funded), workshops, and community-building events for founders in their cities. Birmingham is incredibly lucky to have such a great organization come to our city and help bridge the funding gap for women of color. I’m excited to see all they accomplish here in Birmingham as they start their newest chapter in the Southeast.
Want to learn more? Head to www.blackgirlventures.org.
Must-Reads This Week
Stratchery’s post on the acquisition of Plaid by Visa. It goes into really great detail just how simple yet effective Plaid was and why Visa acquired it. It also explains how screen-scraping which is what Plaid basically did, could comprise the security of your banking information.
Give it a read here.
That’s all for this week; thanks for reading. Don’t forget to share!
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