Truist — one of many nation’s largest monetary establishments — has acquired Long Game, a 12-person fintech startup that has raised over $20 million in enterprise capital, executives have instructed TechCrunch solely.
As of June 2021, Charlotte, N.C.-based Truist was the tenth largest financial institution, with $509 billion in property. It was fashioned in 2019 as a merger between BB&T and SunTrust banks.
Based in 2015, Lengthy Recreation has constructed a gamified finance cell app that goals to assist individuals “save, study and have interaction” with their funds. Particularly, the San Francisco-based startup needs to drive financial institution buyer engagement utilizing prize-linked financial savings and informal gaming to inspire sensible monetary behaviors.
Neither firm disclosed what Truist paid for Lengthy Recreation, or the corporate’s revenues, saying solely it was “rising 12 months over 12 months”
Led by co-founder and CEO Lindsay Holden, Lengthy Recreation has raised over $20 million in funding from traders comparable to Vestigo Ventures, Franklin Templeton, Thrive Capital, and Collaborative Fund. TechCrunch lined the startup’s $6.6 million raise in 2017.
“Over half of People have lower than $500 in financial savings and so lots of people, if one thing sudden occurs, it may be actually detrimental to their monetary lives,” Holden instructed TechCrunch. “We needed to method that downside otherwise. And we thought so much about behavioral economics and the way persons are motivated, and one of many issues that we got here throughout was a behavioral economics factor known as prize-linked financial savings.”
Prize-linked financial savings, she stated, is an idea of somebody putting cash in a financial savings automobile for an opportunity to win cash.
“It’s actually taking that lottery dynamic, the place persons are attempting to win huge and placing it in direction of one thing,” Holden added, “As an alternative of shopping for a ticket and simply throwing away that money, you’re placing it right into a financial savings account.”
Unsurprisingly, Lengthy Recreation is focused extra to GenZers and millennials, Holden stated, noting that former Zynga workers are staffers.
“It’s a real recreation, as we’re actually utilizing recreation dynamics to drive monetary literacy. Lengthy Recreation makes use of finest practices from the gaming trade to interact with customers,” she stated. “There’s a trivia facet and purchasers get rewards for studying.”
Its important advertising channels up to now have been social media advertising and the usage of recreation advert networks.
For Truist, the chance to succeed in a coveted – and tough to succeed in – youthful demographic was interesting.
Vanessa Vreeland, head of company Improvement at Truist Ventures – the financial institution’s enterprise arm, instructed TechCrunch that whereas the acquisition of Lengthy Recreation was not the financial institution’s first fintech purchase, it was maybe probably the most “important.”
“This one was one which simply had a unique really feel to it,” she stated. “It didn’t include a stability sheet. It was our first fintech acquisition with out a stability sheet.” Truist/SunTrust beforehand acquired on-line lender LightStream and Service Finance, a point-of-sale software program supplier.
As a part of this newest acquisition, Lengthy Recreation’s engineers, designers and executives will be part of Truist’s Innovation workforce.
“We view ourselves as an enormous startup…and as we had been seeking to develop our choices for our retail financial institution, we had been in search of methods to not solely purchase prospects, however to deepen our relationship with them,” Vreeland stated. “…We thought ‘what higher method to actually have interaction with our clientele and appeal to new purchasers from youthful generations to Truist than by providing a extremely thrilling gamified method to save and to interact with private funds?’…Truist’s app might be “built-in with the Lengthy Recreation expertise.”
The financial institution plans to “relaunch” an enhanced model of the app “to make it obtainable to over 15 million households,” she added.
Truist does have places of work in San Francisco in the present day, the place it serves its wealth purchasers in addition to its company and funding banking purchasers,
“However we haven’t targeted but on constructing out expertise or innovation groups out on the West Coast,” Vreeland instructed TechCrunch. “We’re excited to place a vital mass of parents in our San Francisco workplace, and we might be persevering with to enhance Lindsay and her workforce with expertise, product and design expertise as we proceed to construct out Truist’s capabilities to satisfy the technological calls for of our purchasers.”
Truist got here to pay attention to Lengthy Recreation by means of a couple of totally different channels, in keeping with Vreeland. For one, Lengthy Recreation participated in FIS’s Fintech Accelerator Program. She additionally grew to become acquainted with the corporate by means of private networks.
For her half, Holden stated she was drawn to Truist’s “intense focus” on the consumer, which she seen just like that of Lengthy Recreation’s.
“We solely deal with the consumer expertise of actual monetary progress – taking one thing that feels tough and at instances emotionally fraught and making it into one thing motivating, enjoyable, and even magical,” she added. “It’s so nice to be part of a workforce who’s embracing and investing in our dream to make the perfect client monetary expertise on the market.”
In the meantime, the intersection between banks and fintech startups is going on extra recurrently, the place the 2 are both partnering or competing or like on this case, one is getting acquired by the opposite. And plenty of banks have come to understand that it makes extra sense – financially and logistically – to amass a longtime fintech than try and construct out the expertise themselves.
“We’re a really face-oriented group. We spent fairly a little bit of time assembly with our purchasers. and so we all know that our purchasers need to proceed assembly with us in particular person but in addition need to work with us digitally,” Vreeland stated. “We need to preserve that stability of contact by means of all of the digital channels that we pursue and so we had been very enthusiastic about Lengthy Recreation’s potential to assist us do this.”
As proof of that elevated digital focus, Truist earlier this 12 months shuttered dozens of bodily branches.
Vreeland stated she was additionally drawn to the truth that Lengthy Recreation was led by a feminine CEO.
“We had been actually excited to satisfy a feminine CEO – that was actually vital to us as we take into consideration constructing a portfolio of services inside Truist which can be actually as various because the purchasers and communities that we serve,” she added.
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