This interview is about the big trends in fintech investing. Guest Ben Savage thinks that over the next 20-50 years, investing will shift from public markets (like stocks) to private markets (like venture capital), because technology is making previously uninvestable assets (like personal loans, sneakers, or even teachers' homes) tradeable. He's bullish on income share agreements (ISAs, where you repay with a slice of future income), which let investors bet on specific groups' wages. Key holdings: Landed (helps teachers buy homes, creating a new risk layer), Lending Club (packages personal loans), and StockX (lets sneakers trade like stocks).
Ben Savage (Partner at Clocktower Ventures) provided a comprehensive overview of the fintech investment ecosystem on the Invest Like the Best podcast. The core thesis is that technology is driving assets from liquid markets to illiquid markets, making previously uninvestable assets investable (as il
In the interview, Ben Savage (Partner at Clocktower Ventures) systematically articulates the core framework for fintech investing. Savage argues that over the next 20-50 years, the investment world will undergo a massive shift from "liquid, regulated markets" (i.e., today's public markets) to "illiquid, lightly regulated markets" (i.e., today's private markets). Technology is making previously invisible and unreadable assets investable, which will fundamentally reshape the landscape of asset management.
Savage argues that today's dichotomy of "public markets vs. private markets" is a historical accident, a byproduct of the post-Great Depression regulatory framework.
Implication: Savage believes that 20–50 years from now, the majority of market value and alpha opportunities will reside in what is today called "private markets." This means both institutional and individual investors will need to rethink their asset allocation frameworks.
Savage argues that the core opportunity in fintech lies in "making assets that were previously invisible and unreadable investable" — an extension of what ETFs have done in the past.
Savage uses the gold ETF as a classic example: 25 years ago, buying physical gold was extremely cumbersome — requiring visits to physical stores, paying markups, and managing storage. Today, "with a click on the screen, you own GLD." The ETF injected liquidity into the gold market, enabling millions of investors to hold gold as part of their portfolios.
| Asset Class | Past State | Technology/Platform | Current State |
|---|---|---|---|
| Personal loans | Held on bank balance sheets | Lending Club, Prosper | Securitized and purchased by institutions, hundreds of billions in scale |
| Sneakers/collectible cars | Non-standard, illiquid | StockX, Rally Road | Tradable with market pricing |
| Agricultural receivables | Invisible | Startup platforms | Tradable |
| Equity in small consumer companies | Inaccessible to institutions and individuals | CircleUp | Accessible to accredited investors |
Savage uses Landed as an example to illustrate how technology can alter the risk structure at the asset level:
Reader note: Savage is an investor in Landed, and this analysis reflects his position. He himself acknowledges: "They would hate me calling it mezzanine, but that's what it looks like."
Savage argues that Income Share Agreements (ISAs) will create a new, high-resolution approach to risk pricing, allowing investors to directly bet on the future income of specific populations.
Savage believes ISAs will grant investors access to investment themes that were previously impossible to express directly:
| Expressed View | Traditional Approach | ISA Approach |
|---|---|---|
| Doctor incomes will decline | Buy/sell healthcare stocks or bonds | Directly short a doctor ISA pool |
| U.S. wages will rise | Via inflation instruments (imperfect correlation) | Directly long a wage ISA |
| Bay Area wages vs. New York wages | Cannot be expressed directly | Long Bay Area ISA + Short New York ISA |
Savage judges: "Almost every participant in the student loan infrastructure dislikes the current system — from universities to the government to debt providers. The only ones who like it are the servicers, and even they are starting to realize the business is collapsing under its own weight."
Savage argues that, in theory, an indexation strategy for venture capital can be constructed, but the "privileged access" problem makes actual implementation extremely difficult—the brand premium of top-tier VCs can even lead founders to accept a 40% valuation discount.
Savage shared a key case: a founder in his portfolio, in order to secure the brand of a top-tier VC, accepted "a valuation that he internally believed was 40% lower than the market." The founder also called other portfolio companies of that VC and received the following response: "Yes, you have to accept a 40% discount, but you'll get a premium in the next round because of the brand."
Savage is skeptical of this ("it may not sound true"), but he acknowledges: "These brands are strong enough in founders' minds because the market is not transparent enough and lacks liquidity—you can't really tell whether a manager is creating value."
Extrapolation: As capital continues to flood into venture capital, can this privilege persist? Savage draws a parallel to private equity in the early 2000s—when everyone said "it can't get any bigger," but by 2020 it was larger than anyone had imagined. He believes venture capital will follow a similar path.
Savage argues that a core trend is that "financial functions once affordable only for large enterprises are being democratized through technology to small businesses, freelancers, and gig workers."
Savage proposes a counterintuitive framework: In the past, JPMorgan could not build a bank for yoga instructors because the cost of building a bank far exceeded the size of that market. But today:
| Past | Present |
|---|---|
| Needed to build core systems in-house | Can outsource to infrastructure companies |
| Needed to build marketing in-house | Can outsource to precision marketing platforms |
| Needed to build UI in-house | Can outsource to design firms |
Conclusion: The cost of building a "yoga instructor bank" has dropped significantly, making it economically viable. Savage believes the real opportunity is not yoga instructors, but large categories such as medical practitioners, first responders, military personnel, and venture capitalists — a "death by a thousand cuts" competition is threatening large banks.
| Position | Guest Stance | Key Data |
|---|---|---|
| Landed | Bullish (Invested) | Matches down payments for teachers, creating a "mezzanine" layer in residential capital stacks |
| Lending Club / Prosper | Neutral (As Case Study) | Personal loan securitization market reaches hundreds of billions of dollars |
| StockX / Rally Road | Neutral (As Case Study) | Makes sneakers/collectible cars tradable |
| CircleUp | Bullish (Invested) | Enables institutions and accredited investors to buy equity in small consumer companies |
| Silicon Valley Bank / First Republic | Neutral (As Case Study) | Successful case of building a bank for the venture capital community |
| Geico | Neutral (As Case Study) | Achieves success through precise risk pool selection and low-cost operations |
| Robinhood | Neutral (As Case Study) | Reduces commissions to zero, jumping to the endpoint of the trend |
| Betterment / Wealthfront | Neutral (As Case Study) | Provides passive indexing to individuals at low cost |
| Intuit / TurboTax | Neutral (As Case Study) | Still fails to reach the complexity of large-scale corporate tax planning |
1. "Stop saying public markets and private markets; say liquid markets and regulated markets" — Savage argues that today's dichotomy is an accidental byproduct of the 1930s regulatory framework. Over the next 20–50 years, the world will shift en masse from the "liquid + regulated" quadrant to the "illiquid + low-regulation" quadrant.
2. "We haven't heard of a single blockchain project that makes me think, 'If we didn't use blockchain and just used an SQL server, what would be different?'" — Savage is skeptical of cryptocurrencies, believing that aside from Bitcoin's legitimate use case as "digital gold," the magic disappears from most blockchain applications once the word "blockchain" is replaced with "alternative database technology."
3. "A founder accepted a 40% valuation discount just to get the brand of a top-tier VC" — Savage uses this case to illustrate how deeply entrenched the "privileged access" problem is in the venture capital market. Brand premiums can persist in opaque markets, even when higher bids are available.
4. "We can settle complex derivatives in T+4, but most people settle their wages in T+14" — Savage believes the wage settlement cycle represents a massive opportunity for fintech. Technology is making the moment of "labor-value exchange" more real-time and transparent.
5. "In the past, building a 'yoga instructor bank' wasn't worthwhile because the cost of building a bank far exceeded the size of that market—but today, costs have dropped dramatically" — Savage proposes that vertical financial services (e.g., "banking + medical practitioners," "banking + police officers") will become the core form of future fintech, with large banks facing the threat of "death by a thousand cuts."
6. "An ISA allows you to bet that 'U.S. doctor incomes will decline'—today you can't directly express that view, but in the future you will" — Savage believes income share agreements will create entirely new beta exposures, enabling investors to directly bet on the future income of specific populations—something traditional financial instruments cannot achieve.
7. "A $200 billion pension fund, if it only invests in the top 50% of venture capital managers, needs just $500 million a year—that's only a 1.5% position" — Savage argues that venture capital indexing is theoretically feasible, but the "privileged access" problem makes it extremely difficult in practice. The brand premium of top-tier VCs can even lead founders to accept valuations 40% below market.