The most underrated company in finance

Figure Technologies is probably one of the most underrated companies in finance today.

The company was founded by five people, including Mike Cagney who previously founded SoFi, the $4.5 billion consumer lending startup. They have raised over $120 million to date from DST Global, DCM, Ribbit Capital, Morgan Creek Digital and many others, along with growing to over 100 employees in less than 18 months.

The company creates innovative consumer financial solutions for home improvement, debt consolidation and retirement while providing its members with financial education and financial empowerment. Its mission is to build and promote innovative financial products on blockchain that benefit consumers and eliminate rent-seeking, illiquidity and other inefficiencies present in current financial markets.

Figure got started with its flagship product, Figure Home Equity Line, which is a fixed-rate line of credit that provides approval in as little as five minutes and funding in five days, all online. It combines the best characteristics of a traditional home equity loan and a HELOC. Consumers can borrow against the equity in their homes without the paperwork-intensive, 45-day process traditional lenders require. Since September 2018, Figure has funded more than 1,500 HELOCs for members across 37 states.

The team than quickly moved to launch Figure Home Lease Back, based on a belief that many Americans will face challenges funding their retirements. These homeowners may be able to access the equity in their homes to fund the shortfall in retirement income using the new product, which is a more transparent and straightforward alternative to reverse mortgages. Figure Home Lease Back members can sell their homes to Figure, get cash up front and stay in place as renters for as long as they wish. Figure covers all expenses, including property taxes, upkeep and insurance.

The first two products, along with future products around wealth management and investment funds, are all built and deployed on Provenance, a distributed stakeholder blockchain. The company leverages the security, efficiencies and cost advantage of blockchain for loan origination, financing and sales and has a diverse set of funds, banks and dealers active on Provenance today. While Figure was the first loan originator on Provenance, several other originators plan to use the platform by mid-2019.

Additionally, the company announced today Provenance Blockchain, Inc. ("PBI"), the administrator for the blockchain, has completed a $20 million security token offering to support the continued development and expansion of the ecosystem.  Since Figure built the blockchain, it has obviously been an early adopter of, originating, financing and selling its HELOC loans entirely on the platform.

Not only has Provenance been embraced by many incumbent financial institutions, like Franklin Templeton, it is also working and being used to originate more loans than any other blockchain I have seen. The most exciting part? Provenance has released a white paper through collaboration with Morningstar that suggests blockchain-based instruments will receive higher credit ratings as well.

Having a more efficient, lower cost, higher rated credit instrument is a significant advantage. Not only do I find Figure and Provenance interesting, but I believe they will both be incredibly valuable in the future. This led us to make our second largest investment to date earlier this year in the equity of Figure.

Betting on impressive teams with track records of execution, who are going after massive market opportunities, has proven to be a winning strategy in the past. Don’t be surprised if this time is no different.


The “Off The Chain” podcast has been downloaded 800,000+ times in 160 countries. You can listen to the latest episode with Mike Belshe, CEO at BitGO here: Click here for Off The Chain podcast


Congress Is Pushing a Blockchain Bill. Does It Defeat the Point of Decentralized Tech?: What happens when a central authority like the U.S. government tries to shape a decentralized technology? We’ll soon find out as a proposed law, called the “Blockchain Promotion Act,” picks up momentum in Congress. The bill, introduced for the second time in February, has bipartisan sponsors in both the Senate and House of Representatives. It calls for the Department of Commerce to come up with a standard definition of “blockchain,” a technology that underpins bitcoin, and which can be loosely described as a tamper proof ledger run across multiple computers. Read more.

Coinbase-Backed Securitize Launches One-Stop Shop for Token Services: Coinbase-backed security token startup Securitize has launched a referral network of sorts to help companies issue and manage digital securities. Announced Tuesday, the “Securitize Ready Program” incorporates services from various partners, including Coinbase Custody, trading platforms OpenFinance and Rialto Trading, as well as private investment group CBlock Capital. More partners are expected to join the program in the future, Securitize said. Read more.

Advocate for Mt Gox Creditors Quits, Saying Bitcoin Payouts Could Take Years: The head of the largest organized creditor group representing the former users of failed bitcoin exchange Mt. Gox is stepping down amid what he described as a protracted legal quagmire that could take years to resolve completely. Andy Pag, the founder and coordinator of Mt. Gox Legal, told CoinDesk in an exclusive interview this week that he now believes ongoing legal issues – in particular, a single massive claim by startup incubator and former Mt. Gox partner Coinlab – may hold up the crypto exchange’s civil rehabilitation process for up to two more years. Read more.

Blockchain Could Be Used By At Least 50% Of All Companies Within 3 Years, Oracle Exec Says: Ten years after the idea of blockchain was conceived, the technology that underpins cryptocurrencies is starting to be used by large enterprises as a secure way to track goods. But mass utilization is still years away, and it won't be for every company, said a panel of blockchain executives. “My projection is that between 50% and 60% of companies will use blockchain in the next few years,” said Frank Xiong, Oracle's group vice president of blockchain product development at the Forbes CIO Summit in Half Moon Bay, California, Monday. Read more.

Interested in crypto research? Look no further. The premier research firm in the space, Delphi Digital, has two subscription offerings for individuals and institutions alike. Take a look at their Bitcoin and Ethereum reports to get a taste of their analysis. [Click here]

If you enjoy reading “Off The Chain,” click here to tweet to tell others about it.

Nothing in this email is intended to serve as financial advice. Do your own research.