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Innovation

The Changing Face of a Staple Industry

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Editor’s Note: Jeffrey Meiler resigned as CEO of Marlette Funding/Best Egg in June 2023 and was replaced by Best Egg CFO, Paul Ricci. As part of the leadership transition, Bobby Ritterbeck has been appointed president of Best Egg.

Delaware’s business and financial services sector is a flourishing space where a growing number of fintech startups take a fresh approach to helping customers navigate banking, insurance and investments.

In 1899, Delaware legislators passed a general corporation law that made it easy to incorporate in Delaware. The influence of this development can still be felt today in a thriving landscape of business services providers and law firms that help companies incorporate or litigate matters of corporate law in Delaware’s highly respected Court of Chancery. Nearly 100 years later, Gov. Pierre S. duPont again put Delaware on the map by signing the Financial Center Development Act, which eliminated interest rate ceilings and gave banks tax relief.

This long history in business and financial services leadership has resulted in a deep, experienced talent pool in Delaware.

“We have a lot of financial services people who are starting interesting projects, including fintech startups,” says Ben du Pont, co-founder of Wilmington-based Chartline Capital Partners, a venture capital firm founded in 2010. “Entrepreneurs grow in adjacent spaces, and fintech is an adjacent space to banking.”

Many of the companies occupy distinct niches, which is the sign of a savvy entrepreneur, du Pont says. Examples include fast-growing Marlette Funding and its Best Egg solution for personal loans, or Investor Cash Management, which makes investing more accessible.

At the same time, banking stalwarts like JPMorgan Chase are doubling down on their investment in Delaware. Chase announced earlier this year that it would invest “hundreds of millions of dollars” in site upgrades at its Delaware offices, as well as hiring 725 additional people. Chase Delaware Market Leader Tom Horne told the Delaware Business Times that the bank is confident in the state’s ability to continue bolstering the ranks of tech and financial services workers, although Chase is also investing in workforce development programs to bolster that pipeline and help fill open roles.

“I think everybody has to double down and step on the gas a little bit around how we ensure we have that sustainable technology talent pipeline,” he said. “That’s why we’re investing here.”

Delaware’s financial technology landscape is set to grow even further amid innovative collaborations underway at the University of Delaware’s new FinTech Innovation Hub.

One Way Insurance Group: Making Insurance More Accessible

Most of us wouldn’t claim to understand the deeper intricacies of insurance policies and the insurance business. Add a language barrier to the mix and finding the right insurance for your needs can easily become an ordeal.

For entrepreneur Gertha “Gigi” Jean, that’s exactly the point.

While insurance benefits most people — indeed, in many cases, it is a necessity — it can be intimidating, she acknowledges. In 2018, Jean and her husband Ebens Jean founded One Way Insurance Group with $10,000 of their own money. The goal: make insurance approachable and appealing.

“As soon as I realized how rewarding and enjoyable it can be, I became hooked,” says Jean, who came to Delaware from the Bahamas on a church scholarship. She enrolled at Delaware Technical Community College, where she met Ebens, who moved from Haiti to the United States when he was 13.

The firm’s staff has been growing since One Way’s founding, indicating its success. In part, credit goes to organizations such as the Delaware Small Business Development Center and the Delaware Division of Small Business for providing information and sparking innovation. “We have used these free resources, and it has helped the growth of our business,” Gigi Jean says.

One Way Insurance offers vehicle, life, home and business insurance. Products also include employee benefits. However, the team does not sell cookie-cutter solutions. Instead, they customize risk-management solutions and insurance packages to meet the needs of clients, including small- and middle-market businesses, nonprofit organizations and individuals.

The multilingual company’s tagline is “We Make Insurance Facil.” (Facil means “easy” in Spanish and Haitian creole.) But being an entrepreneur hasn’t always been easy, notes Jean, the company’s CEO. (Ebens Jean is CIO.)

“Despite facing numerous challenges and even contemplating giving up, I have reminded myself of my ‘why,’” she says. “I started my agency from scratch and navigated through the pandemic, which required immense resilience and adaptability. These experiences have helped me grow in strength and character, ultimately shaping me into a better leader.”

Others agree. In 2022, Jean was named a Women in Business leader by Delaware Today magazine. Like many entrepreneurs, she views the company as more than a job. It is a “legacy” for her children, she says.

Marlette Funding/Best Egg: Growing in New Directions

Few companies illustrate the evolution of Delaware’s financial sector as well as Marlette Funding. The company was founded in 2013 by Jeffrey Meiler, previously with Barclays and Citigroup, and Bobby Ritterbeck, who worked with Barclays and First USA. All three banks have been powerhouses in the state.

But most customers don’t know the name Marlette. That’s because the company’s brand is Best Egg, which offers unsecured and secured loans, a credit card and the free Financial Health platform to manage finances and review credit scores. (In fact, the company announced shortly before press time that it would officially change its name to Best Egg.)

The products are far from conventional. For one, Best Egg harnesses the power of the public cloud and digitally delivers its services. For another, the company targets financially sound customers with limited savings. Many have a good credit score but a copious amount of debt.

The services have been well received. In 2022, Marlette raised $225 million of Series E preferred capital and expanded its workforce and leadership team. Marlette also acquired Till, an online platform that allows renters to break up their monthly rent into smaller, manageable payments. Additionally, a vehicle equity loan program was launched in early spring.

Rebranded as Best Egg Flexible Rent, the Till platform was a perfect fit, says Meiler, Marlette’s CEO. Till had a great idea but lacked capital, he explains. “When we met with Till, it quickly became clear that we both shared a passion for two things: customer-centricity and an interest in making lives better for people with limited savings.”

He notes that rent is a significant expense, and the option to make several payments instead of one is particularly appealing to renters without a stable monthly income. For example, consider restaurant servers or bartenders who depend on tips. Best Egg Flexible Rent also introduces customers to the Best Egg product suite early in their financial life. “Most people’s first really big financial commitment is rent,” Meiler notes.

Best Egg markets the service to property-management payment platforms that collect rent for landlords. When the renter logs onto the website, they can choose Best Egg Flexible Rent if they qualify. The user pays Best Egg in increments, but Best Egg always pays the landlord the total amount.

Meanwhile, the vehicle equity loan product gives qualifying customers access to additional capital if they have equity in their vehicle, explains Ritterbeck, president of consumer lending. “It allows them to get longer terms and lower prices.” Moreover, people not qualifying for a personal loan may benefit from the secure product. (Secured loans are backed by collateral.)

He says Best Egg will develop synergies between the various products, and targeting aspiring homeowners might be in the future. For now, the Marlette team has their hands full, giving Best Egg customers the hope of a nest egg.

Investor Cash Management: Banking on Delaware

Born in Houston, TX, Fred Phillips IV has lived in New York, England and Argentina, but he’s found a welcome home in Delaware for both his family and his business, Investor Cash Management (ICM). “We find a tremendous amount of support from the state and the city [of Wilmington] in a really gratifying way,” says Phillips, who moved here from Chicago. “We’ve met with Gov. John Carney and Lt. Gov. Hall-Long I don’t know how many times, and they’ve been supportive.” And no wonder. ICM fits seamlessly into Delaware’s economic landscape. The company combines banking, payments and investments into one account, thereby pairing the liquidity of banking with the high return of investing. “Our unique technology transforms investment products such as mutual funds and [exchangetraded funds] into immediately liquid digital transaction currencies,” explains Phillips, who came up with the idea while living in Argentina, which has an unstable currency. Phillips is a prime candidate for entrepreneurship. His mother, a nurse, was an immigrant from Veracruz, Mexico, and Phillips learned from her the value of hard work and education. The young Texan received one of two scholarships to St. John’s School, a K-12 independent school in Houston. He earned a degree in industrial relations and economics from Cornell University, a master’s degree in philosophy from Oxford University and a doctorate in law from Yale University. He also received a Fulbright scholarship to the Philippines, which he capped with travel to China. Phillips, who clerked for a federal judge, also worked for an international law firm before moving to Argentina to handle TESCORP’s assets — and meet wife-to-be Carolina. Phillips entered the financial sector when ABN AMRO, a Dutch bank, recruited him. At the time, the bank was among the largest to target technology companies for investments.

Phillips and Carolina launched ICM with $6 million in venture capital from Morningstar founder and chairman Joe Mansueto and Lance Weaver, a name familiar to many Delawareans in the banking industry. Weaver, who co-founded MBNA, is the former Mastercard chairman.

Indeed, ICM quickly received endorsement from heavy hitters. For example, ICM is the youngest company to receive an investment from Visa, and a partner is BNY Mellon. “We think we’ve been validated, and we’re proud of our partnerships,” Phillips says.

ICM’s target customers are wealth-management firms, small- to medium-sized businesses and community organizations. The latter are close to his heart, Phillips says. “Of our senior team, all of us are first- or second-generation immigrants, so we are sensitive to issues around racial and gender investment gaps.”

Phillips moved to Delaware partly because of Weaver’s enthusiastic endorsement of the state, but it’s also an excellent place to be, Phillips says. “It’s the payment capital of the United States, and there’s an enormously skilled workforce … and a significant amount of people with meaningful technology skills.” That is a perk since ICM designs and builds its software in-house.

Phillips calls Wilmington a “Goldilocks” city in a “just right” location between New York and Washington, D.C., yet the children’s schools are 15 minutes from home. He plans to build and grow a headquarters in the city. Says Phillips, “We love it here.”

StratFI: Looking for What Comes Next

Jim Lee has his eyes firmly on the future — in more ways than one. He is the founder of StratFI (Strategic Foresight Investments), a boutique investment advisory firm focused on “what happens next,” he says.

The Trolley Square resident is Delaware’s only professionally trained futurist, he says, and he has a master’s degree in the studies of the future from the University of Houston-Clear Lake to prove it.

Raised in Kennett Square, PA, Lee grew up discussing stocks and science at the dinner table. His father was a scientist at DuPont, and his mother came from a banking family. After earning a bachelor’s degree in economics from the College of William & Mary, Lee worked for IDS Financial, now Ameriprise. “It was a great place to learn the basics of providing financial advice,” he says.

While attending a college reunion, he learned he could earn a master’s degree to become a futurist, which seemed more appealing than an MBA. “The whole idea is that if you want to be in the right place at the right time, it is helpful to show up a little early,” he says. Imagine if you invested in cryptocurrency in the early days.

After 20 years of working for others, Lee started StratFI in 2012 to help individuals and organizations manage risk and grow their portfolios. Initially, he thought he’d provide value by picking the right stocks. “As it turns out,” he says, “my secret sauce is market timing. People say it isn’t possible, but I’ve built a solid track record doing it.”

Today, Lee has clients in 16 states and manages $75 million in assets. “If you develop a niche, people will find you,” says Lee, who has been quoted in The Wall Street Journal and written articles for The Futurist and the Journal of Future Studies.

Indeed, Lee happily shares his knowledge with other advisors and financial institutions and is the author of “Resilience and the Future of Everyday Life,” which offers strategies for coping with economic uncertainty. In the book, he anticipated the trend toward buying local foods, the gig economy, the demand for artisan goods, upcycling and the tiny home movement.

His most recent book, “Foresight Investing: A Complete Guide to Finding Your Next Great Trade,” looks at the internet of things (IoT), augmented reality, cryptocurrencies and artificial intelligence. “I’m using AI regularly on a day-to-day basis,” he says.

Not only does he research these trends for clients, but he also investigates how they affect the investment sector. For instance, the industry was an early adopter of AI and automated trading.

Lee says the “winners of the AI wars” will have deep, accurate data sets. Not surprisingly, he says that Amazon, Microsoft, Facebook and Baidu — a Chinese tech company founded as a search engine with an AI component — will be hard to beat.

He predicts that AI will become a helpful coworker, but while programs get the details right, they often fail to see the big picture, which is where human futurists have the advantage. To be sure, COVID has underscored the need for relationship-driven financial services rather than those that are purely transactional, he says.

Investing boils down to risk on or risk off. And it helps to think outside the box. “If you do what everyone else is doing, you are going to get the same results,” Lee says. His advice: “Go and do something different.”

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