The Virgin Money presentation was excellent. It’s not clear to me whether they’re coming to Canada (I’d bet yes) but if they do they have a great model from my perspective.
It’s interesting to contrast the Virgin Money presentation with the Prosper presentation. Virgin doesn’t think that they need to create online financial relationships; those relationships already exist, and they’ll just help “officialize” them and put them online. As Prosper found out in their Facebook experiments, not all friendships are created equal. I like the Prosper model too, but it seems to me you could rely less on new online relationships and instead seek to get existing trusted relationships online.
Again, there seems to be a natural credit union “fit” here. We’re already trusted. We already have access to immigrant communities. We’re already in our communities (that’s all we’re in!). Is this a threat or an opportunity?
The idea of a lifestyle brand in the FI space is interesting. It goes to the WAMU presentation earlier that you shouldn’t try to be all things to all people. It’s a crowded space in the FI world: if you’re new to the crowded space, and your competition is going after everything, you might as well target one vulnerable piece and go hard after it. Nice.
Also, I wonder how much of the fact that Virgin is an international brand allows them to appeal to the immigrant community… and plays into that community’s inclination to fund themselves. Very interesting.
Other points of interest:
- When you can’t be innovative in product, you can still be innovative in service.
- Gartner says that 10% of personal loans will be P2P by 2010. That seemed high to Asheesh from Virgin Money US, and it seems high to me. I’m just starting to pay attention to this now, so I know that I’m late, but I just don’t see even the residual buzz outside of specialists. But I will say that it’ll be on the agenda at future conferences. For sure.
- I like P2P if only because it addresses the basic economic problem: it shows how the internet brings buyers and sellers together… for any market. I know, it’s not a new thought, but after the Prosper presentation yesterday – which distills the idea to it’s essence – it reveals what’s really required to build a market: trust.
10% of all personal loans by 2010? Yeah, that is way too high. But, any percentage of people moving into the P2P lending/borrowing space will impact the financial industry. Even if it is family members lending to family members, since much of that is done on the “down low” – now Uncle Sam will be getting a bit more of the action.