The 2015 Fintech Finance 35: Richard Garman and Brad Bernstein, FTV Capital

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< The 2015 Fintech Finance 35

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Richard Garman & Brad Bernstein
Managing Partner & Partner
FTV Capital

There is no single formula for fintech financing, yet many of the playbooks written over the years owe a debt to FTV Capital. The San Francisco–based firm was formed in 1998 as Financial Technology Ventures, “at the intersection of important emerging technologies and financial services,” says Richard Garman, who joined founding partners James Hale and Robert Huret early on. They built a “sustainable, repeatable business model” around “deep domain expertise” like Garman’s — he was previously CEO of three technology companies, including bank-consortium-owned Electronic Payment Services. That went hand-in-hand with what in the early years was not yet dubbed an ecosystem: a “global partner network” of executives of dozens of major financial institutions, along with a smaller strategic advisory board that meets periodically to share intelligence on market trends and help portfolio companies accelerate sales. The FTV founders stepped aside from day-to-day management before launching the third of the firm’s four funds, which have raised a cumulative $1.8 billion and invested in nearly 90 companies, including such IPO exits as outsourcer ExlService Holdings in 2006 and Financial Engines in 2010. Managing partner Garman, 58, who had an earlier association with Hale and Huret at Montgomery Securities, and Brad Bernstein, 48, formerly of Oak Hill Capital Management and head of FTV’s New York office since 2003, moved into the spotlight for FTV III, which closed in 2008 with $512 million, and $700 million FTV IV of 2014, which is about 50 percent invested. Not buying into an incumbent-banks-are-doomed thesis, Bernstein says, “We see a perfect storm of opportunity in this sector, much of it evolutionary rather than revolutionary.” FTV’s investments tend to be institution-facing, not customer-facing, as with payments venture WePay, which serves online marketplaces and crowdfunding platforms.

The 2015 Fintech Finance 35