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Fintech alone can’t save Twitter. Or can it?

Super apps are still yet to live up to the promise of a great re-bundling of financial services. Elon Musk's ambition to make Twitter a financial one-stop-shop is still a way off too.

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Moving fast and breaking things seemed to be a tech trend that had gone out of fashion. That was until six months ago when one the world’s greatest entrepreneurs took over the running of Twitter after his $44bn acquisition of the company was finalised. 

It is of course early days for Musk’s Twitter overhaul but few would disagree the company is in a perilous position. 

Can stock trading reverse Twitter’s ongoing malaise? 

Last week Twitter launched its first proper foray into fintech.

Via an eye-catching partnership with eToro, fresh from its cancelled SPAC entanglement, Twitter will now facilitate the trading of stocks and shares.

The partnership is a little scant in detail, with the initial tie-up seemingly just starting with access to real-time prices and the ability to jump through to eToro’s platform. 

More importantly there is was no forthcoming information as to whether Twitter would be making much in the way of money from the deal. 

But over time this and other financial services could well become much more deeply embedded in the Twitter proposition.

The reasons for this are two-fold. One Twitter urgently needs to reboot how it makes money through diversification of its product suite.

Musk has seen the company he backed using a huge chunk of his personal fortune tied up in Tesla stock, through loan guarantees from banks and other investors, severely challenged by lower revenue generation. 

Part of this comes from advertisers fleeing the platform following various concerns around its direction under Musk. The economic downturn has also played its part and continues to weigh on ad-funded revenue models.

This has placed Twitter in critical condition and in need of a turnaround in order to stay solvent.  That means new products.

Fintech revenues, in Musk’s eyes, could well be a key driver of this.

Social + Fintech

The confluence of social media and financial services (Social + Fintech, as dubbed by VCs) is an interesting concept, although I have previously written of my doubts as to its utility. Not to mention some inherent risks to both users and broader financial stability.

Bring together the vast networks of existing users' habits on social media with the accelerating consumer interest in personal finance, and especially investing in publicly traded equities and you have a  vast opportunity to reimagine financial services and banking.

And/or really break things. Fast.

The Social + Fintech trend marries the inherent risks of both the financial and banking system with the well-publicised negatives of social media. 

This was most keenly epitomised during the Game Stop Saga of January 2021, which ushered in unprecedented regulatory quandary alongside less-than-desirable behaviour from consumers, many of whom lost stakes they had not prepared for.

Secondly, financial services could well become an increasingly apparent Twitter feature because of Musk's long-term interest in digital banking that began with his founding of Paypal and X.com. 

Musk has previously made multiple mentions of his am ambition to augment Twitter towards some kind of ‘super app’ that would re-animate his long-held idea - and domain name - X. 

This includes a move to include some kind of payment function for users as well as helping the world’s swelling ranks of digital ‘creators’ monetise their content.

In truth though, $44bn seems like a high price to get a fintech super app off the ground. 

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