He’s Raised $18.5m To Help Banks Use Open API’s, Makes Money From # of API Calls

Steve Kirsch

In Episode #763, Nathan interviews Steve Kirsh. He’s the CEO of Token, a Silicon Valley startup company developing a modern platform for open banking. He’s pioneered several computer core technologies like optical mouse, Internet search, spam filtering, and secure identity and founded 7 high tech companies—two with billion dollar market caps such as Infoseek and Frame Technology. He received his BS and MS in Electrical Engineering and Computer Science from MIT in 1980.

Famous Five:

  • Favorite Book? – Like A Virgin
  • What CEO do you follow? – Elon Musk
  • Favorite online tool? — SimplyFile
  • How many hours of sleep do you get?— 6.5
  • If you could let your 20-year old self, know one thing, what would it be? – “Just hire good, strong and experienced people”

Time Stamped Show Notes:

  • 01:25 – Nathan introduces Steve to the show
  • 02:04 – Token supplies open banking software to banks
    • 02:24 – There’s no real API that works with banks and this is the problem
  • 03:00 – One of Token’s customers is Fidor Bank
  • 03:02 – The problem is most banks don’t have an open API where you can do things like move money
  • 03:19 – Token can get into Fidor’s API to drive its API
  • 04:13 – Token has spent time creating an end-to-end secure architecture that is based on digital cryptography
  • 05:24 – Steve thinks that there’s no real need for blockchain for a lot of financial applications
    • 05:38 – “The technology for blockchain is just not appropriate”
    • 05:48 – The Bank of England did an experiment with ethereum
  • 06:24 – Token was launched in 2015
  • 06:50 – Steve shares how Token came to life
  • 07:15 – Token raised $18.5M in a series A
  • 07:26 – There’s legislation in Europe that requires banks to open their APIs and that’s when Token came in
  • 08:07 – Token charges per API calls
    • 08:10 – Token gets the calls for free from the banks
    • 08:50 – The charge depends on the API calls
  • 09:18 – Nathan simplifies how the model works
  • 10:05 – There’s no equivalent to PSD 2 in the USA and it’s only for banks in Europe
    • 10:20 – This can only happen in the USA if people want to be compatible with the banks in Europe
  • 11:33 – Token’s first bank
  • 12:11 – There are currently around 5 banks that are integrated with Token
  • 12:25 – Team size is 25, split between San Francisco and London
  • 14:20 – The Famous Five

3 Key Points:

  1. Find the perfect timing and opportunity to pitch your business.
  2. It is easier and more secure for banks to adapt a technology that has been tested than it is for them to create their own.
  3. Hire good, strong and experienced people for your business—it just makes like easier.

Resources Mentioned:

  • Simplero – The easiest way to launch your own membership course like the big influencers do but at 1/10th the cost.
  • 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
  • GetLatka – Database of all B2B SaaS companies who have been on my show including their revenue, CAC, churn, ARPU and more
  • Klipfolio – Track your business performance across all departments for FREE
  • Hotjar – Nathan uses Hotjar to track what you’re doing on this site. He gets a video of each user visit like where they clicked and scrolled to make the site a better experience
  • 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
  • Show Notes provided by Mallard Creatives