neocova strategic advisory board q&a

Strategic Advisory Board Q&A with Gregg Schoenberg

Neocova is proud of the talented people who sit on our Strategic Advisory Board. Their varied expertise makes them instrumental in shaping Neocova’s strategy and ensuring we are best positioned to serve our clients, and we’d like you to hear from each of them. In this interview, SAB member Gregg Schoenberg, shares his thoughts on the fintech sector, “invisible banking,” and what lies ahead for community banks after COVID-19.


Tell us a little bit about your career progression. You came to fintech from a fairly conventional financial services background, yes? 

GS: I spent about 13 years as a capital markets banker, primarily for European financial institutions in New York. My original focus was in public equities, but over time, I became involved in raising both private equity and debt capital for growth companies.

A few years after the 2008-09 crisis, I started making small angel investments in financial start-ups in and around New York. Keep in mind that in 2011, if you told a typical banker that you were interested in fintech, they may have thought you were referring to technology coming from Finland. Fast forward several years later, and financial innovation has gone mainstream. Along the way, I started, scaled and sold a media company chronicling the financial industry’s love-hate relationship with technology. I’m also affiliated with a fintech VC fund and a few companies including Neocova.


What drew you to the fintech sector and Neocova in particular?

GS: The sector was an ideal vehicle for me to first question the financial services status quo and then do something about it. Yes, there’s a lot of hype and hyperbole in the space, but there’s also a lot of great work being done to make financial services better.  Take Neocova. It’s truly one of the good guys of modern finance, and I resonated immediately with the company’s mission, philosophy and way of doing business. Plus, there are several bald men in senior positions at the company, so I feel right at home.


We hear a lot about the inevitability of ‘invisible banking” these days. Are you convinced of its inevitability?

GS: I am most definitely not convinced. Silicon Valley is chock full of entrepreneurs and investors who believe that payment, cash management, investment and lending solutions will be embedded into services that companies (not banks) will provide to their consumer and business customers.  We’ll continue to see that trend to some extent, but I don’t believe that non-banks or neobanks will be able to displace regulated financial institutions any time soon. I also think that this idea of fully sequestering financial services into the distant background is nonsense. 


Why do you think that?

GS: Because when it comes to money, business owners and retail customers will continue to want face-to-face interaction with trusted providers — not for every service, but for the important stuff.


Community banks are, on the whole, struggling while fintechs don’t seem to be having any trouble raising money these days. How do you see that dynamic playing out?

GS: I think that community banks (and community bankers) know that they need to modernize their offerings and security in order to thrive. They don’t suffer from a lack of imagination in getting there. They’re being held back by a tech stack that wasn’t built for where banking is going. Community banks that can break free stand a good chance of not just surviving the digital age, but benefiting from it. But in the post COVID-19 era, the idea that you can win while playing it safe is a non-starter. For those that truly want to win (and have a solid plan), growth capital is still available.


Given the headwinds facing community banks, both structurally and as heightened by the COVID-19 pandemic, what is your five-year projection for community banks?

GS: Generally speaking, I think that there’s a good chance that COVID-19 may wind-up benefitting smaller communities that can offer cheaper real estate, less density, lower taxes and better quality of life than what some dense cities can offer. That creates an opportunity for local banks. But community banks will need more than a nice welcome mat to successfully manage inbound customer interest. They’ll need to have an omnichannel approach, competitive rates and best-of-class products. In order to do that, they’ll need to work in partnership with technology companies. But if they continue to own the customer relationships, it will be worth it. Profitable too.




Gregg Schoenberg is currently the managing partner of Wescott Capital Inc., he was an early investor in fintech innovation, a co-founder of The Financial Revolutionist, a capital markets investment banker and a contributor to TechCrunch. He ran the equity department of Natixis North America, and he served on the bank’s US board. His government experience includes legislative affairs and crisis communications roles in both New York and Washington D.C.