GloriFi - anti-woke bank.

2022-2023

Texas-based GloriFi was a Fintech startup that aimed to be the “anti-woke,” anti-ESG banking alternative for American conservatives to “put their money where their values are.”

Founder Toby Neugebauer and his wife raised $50M from 84 conservative backers, including billionaires Peter Thiel (PayPal), Ken Griffin (Citadel), Vivek Ramaswamy (Republican presidential candidate) and Jeff Sprecher (Intercontinental Exchange), Daily Wire talk show host Candace Owens, and consultant to Mike Pence, Nick Ayers.

Products and services designed to match member lifestyles and value included credit cards manufactured out of bullet shell casings, homeowner’s insurance discounts for responsible gun owners, and legal expense coverage if a member shot someone in self-defense.

GloriFi was due to go public in Spring 2023 via merger with the SPAC company DHC Acquisition Corp. But within months it folded. The company claimed that the failure was due to financial challenges after startup mistakes, the failing U.S. economy, reputational attacks, bad press, etc.

However, the real flaw was to try to build a bank from an affinity concept. An affinity product is a product branded to appeal to a certain demographic. It’s a marketing gimmick banks sometimes use to get customers in the door. But after they get the customers, banks need to be proficient in the core business: taking in deposits and extending credit to good borrowers. The supporting credit mechanisms are required to manage a bank’s money. Even a silly-themed nonbank still needs to act like a bank if they offer credit.

The initial $50M raise was more than enough to start offering basic banking services and products. Where did the $50M? Stay tuned—the story isn’t over.

References:

Forbes - how-fast-can-a-startup-non-bank-burn-50-mm
Rollingstone - anti-woke-bank-glorifi-shuts-down

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