By Gilgamesh Ventures and the Wharton School of Business

Everyone knows about the PayPal Mafia. Beyond changing how money moves, in the last two decades PayPal has propelled several cohorts of revolutionaries that have reshaped how finance works, including Elon Musk, Peter Thiel, Max Levchin, Reid Hoffman, and others. But is PayPal the sole example? 

It’s been my suspicion for some time that it’s not.  So in the last few months, in partnership with The Wharton School of Business represented by professor Dave Erickson, Miguel Armaza and I set out to explore further whether other launchpads of entrepreneurship exist elsewhere in fintech. With the help of three extraordinary Wharton MBAs – Kirstie Irmana, Kris Jenk, and Josh Jagota – we found that others indeed exist, and several findings are deeply consequential.  Let’s explore those below. 

To begin answering our question, we sought to identify the biggest, most influential fintech companies in both North and South America.  Starting with hundreds of contenders, we narrowed our list to fifteen companies based on a variety of factors.  For simplicity, we’ve dubbed these fifteen the “Fintech Families.”  The impact of these fifteen companies is simply unparalleled, having spawned close to 2,600 founders in the Americas, with ~12% (298) of those founders having founded fintech companies across the US and Latin America.

In addition to their operating scale and financial success, these companies have played a sometimes hidden yet foundational role in defining the future of fintech, via their alumni.  But that’s not our only finding. The results of our research underline resilience and growing momentum throughout these networks of companies and founders. In recent years, a strengthening wave of startups has emerged from the Fintech Families, with over a third of the top startups in our analysis receiving funding in the last two years alone. In fact, 2023 produced the highest number of fintech founders from this subset across any individual year (27% of the entire subset, to be exact), signaling that entrepreneurs aren’t hesitating to jump into emerging verticals in the space. 

Below are the fifteen Fintech Families we identified, along with some accompanying statistics: 

Each of the fifteen surely merits in-depth coverage, but we can’t do that here. But below are the top three startups spawned from each member of our Fintech Families, based on the amount raised. 

Next, we will spend some time discussing what we learned in the process of better understanding these fintech powerhouses and the companies they helped create. 

Beyond their general impacts, the Fintech Families have each influenced categories and verticals in unique and interesting ways.  Let’s explore those below. 

Power laws are real, but size isn’t everything. 

Our foremost goal was to find the companies that spawned the greatest number of alumni founders, as well as how they stacked up amongst each other. Several of the Fintech Families went above and beyond in terms of generating future founders. You can see this clearly below, in our chart of fintech founders by company.

An even more profound variance emerges when you examine influence based on dollars of funding raised by alumni companies.  The numbers are simply astonishing in several instances. For instance, Square alums have raised almost $1b, Zillow founders almost $900m, and SoFi founders almost $600m. These are just the top three. 

Product and engineering leaders disproportionately start alumni companies.

Strong technical leadership is non-negotiable for success in fintech. But how abundant was it in the sample?  Indeed, relatively early in the analysis, we found that product and engineering founders were disproportionately represented in the data.  Fully 50% of the founders at the Fintech Families were in product or engineering roles before becoming founders, and many went on to become technical founders of the companies they started. Furthermore, the product / engineering percentage among our alumni-founders was higher than the product / engineering headcount percentage at most of the companies themselves.   

What about other roles?  Several notable trends were present.  For instance, strategy and biz ops are surprisingly common as founder backgrounds.  Yet sales perhaps was under represented – few former sales leaders started companies in our sample. 

Fintech companies create founders that can lead in other verticals. 

Expertise is an important element of leadership. Yet it isn’t everything. Some leaders stick with what they know, whereas others love to venture out. For a few examples of the latter, look no further than Jack Dorsey or Elon Musk.  

Through the analysis, we’ve learned that founders from Fintech Families don’t just innovate in fintech. Most instead build outside of fintech actually. But there is some variability in the data as well.  Some among the Fintech Families have a great bias towards generating fintech-focused founders – Brex, Affirm and Carta being foremost among them. Brex, for example, had 23% of its founders become fintech founders - double the group’s average of 12%. 

Why did this happen?  Several things could be the cause.  Our hypothesis is that alums in the sample simply leveraged the unique training opportunities available from being present in a hyper-growth environment, afforded by being employed at the fifteen spectacular companies. Few have this experience, and it can be a powerful training ground. These learnings were then used as the foundation to start the next generation of companies that were studying here. Other forces could be at work, but surely this one is playing a role.  

Alumni of Fintech Families launch and raise capital regardless of market conditions. 

We also asked how the alums of the Fintech Families did when it came to raising capital.  Were they driven simply by momentum, or did they possess more lasting advantages, that might enable them to continue building even when times are tough. 

The results really surprised us – Fintech Family alums actually started more companies in 2023 than in the preceding years, when raising capital was much easier.  The data is below. 

Why did this happen? It is possible that many found the flexibility to start companies later on after they took money off the table while working at big companies in 2020 and 2021. It’s also possible that some started companies following mass layoffs after the market turned in 2022.  Or perhaps these founders seized the opportunity from softening competition, due to weaker macroeconomic conditions after 2021.  Examples from the past – SoFi in particular comes to mind – of fintech companies thriving in bad conditions abound.  If that dynamic persists, we expect to see more examples of generational companies emerging from the ashes in the coming years as well.  

These dynasties may matter more outside the US, than within it. 

The US of course isn’t everything, and we found really interesting trends outside it.  Among them, we have assembled reasons to believe that Fintech Families might be more influential in Latin America in particular. Four of the Fintech Families on our list are from Latin America (Mercado Libre, Nubank, Rappi, and Creditas).  Moreover, our analysis suggests that Fintech Families are indeed more influential in LATAM than in the US, based on the amount of capital raised by the top-4 families in each market, compared to the total capital raised in those markets. This isn’t something we expected, but it is great to see. 

There are other differences too. We found some clustering in terms of business models among the fifteen companies in the sample. Marketplaces (Mercado Libre and Rappi) and lending (Creditas and Nubank) are the only two categories present in Latin America in our analysis, whereas the US has more diversity of categories (e.g., payments, investing, proptech).  Yet this may not persist — early indications also show that more diversity of business models is on its way, based on our review of the alums of these companies. The future is likely to bring greater balance to LATAM, we think. 

Last, we expected Brazil to be overrepresented given the size of its economy in Latin America. But spanish-speaking Latin America punched above its weight: We were surprised to find that Mercado Libre and Rappi (the two Latin American, non-Brazilian companies among our Fintech Families), spawned nearly 3x the number of founders and 2x the number of fintech founders as Nubank and Creditas (our two Brazilian companies among our Fintech Families). 

We don’t claim to have a monopoly of truth on this topic, and so many other topics are worth discussing — notably whether any meritorious companies have been left out, given how many great companies were started outside these fifteen.  But below are some other, more long-term questions we are pondering about this topic.  

We will see the biggest effects of these Fintech Families in the next 5-10 years. 

Unsurprisingly, we are perhaps most interested in what is going to happen next. We are particularly partial to the idea that we’re in the early innings of impact from the alums of the Fintech Families. The largest cohort of new companies being created among alums of the Fintech Families was 2023 – last year. As a result, we can probably expect a continuation of companies being founded from these sources in the coming years.

We arguably should expect these companies to have their greatest impact in the next decade to come. The median incubation time for companies to IPO falls between seven and ten years, so the 2023 cohort will likely be reaching liquidity from 2030 to 2033. That’s a long time from now. With this in mind, we’re excited to see what the future brings for these companies.

Who and what create Startup Mafias and where will we likely see them next? 

Figuring out the types of founders that create Fintech Families is a huge undertaking – a massive subject on its own that’s probably outside the scope of this analysis. But we do notice some interesting things about the companies that we’ve identified. 

Looked at in the aggregate, each of the fifteen all do different things, and they are from different geographies. But across the board, these companies have managed to all build nationally and sometimes internationally recognizable brands. This is a common thread – but why?  Is it because strong brands are a magnet for strong talent? Or is it possible that the causation runs the other direction: Perhaps strong talent is necessary to create strong brands. It is hard to say which is driving which, but the relationship is extraordinarily obvious, when looking at the data. 

Regardless of the exact drivers, you need to attract amazing people to build companies this large and successful.  Because of this, companies that fly under-the-radar, that focus solely on head-down-execution, and neglect brand-building, may fail to capture the attention of amazing talent, with the potential to found and lead companies down the road. 

We also asked ourselves where we’ll see Fintech Families emerge next. Of course, we can expect that big winners generally are going to be the main source. And predicting who those will be is a tall order on its own, for obvious reasons.   Irrespective of the sources, we feel confident that fintech insiders will be over-represented among the winners in the future. Furthermore, we expect a continuation of future fintech founders starting their careers at other successful fintech startups prior to launching their own companies — the advantages are too large for this to not be the case. 

I hope you’ve enjoyed our research.  It’s been a lot of fun diving into the data and identifying key trends. In some cases, it confirmed what we already knew, and in other cases, it proved us totally wrong. And in some cases it brought to light certain information that hadn’t even been on our radar. Hopefully, this deep analysis helps you as much as it has helped us better understand our growing and complex industry. 

Gilgamesh Ventures Team - Miguel Armaza, Andrew Endicott, Paula You

Wharton School Team - Dave Erickson (Professor), Kirstie Irmana, Kris Jenk, Josh Jagota

About Gilgamesh Ventures 

Gilgamesh Ventures is a NYC-based, early-stage venture capital firm that backs founders building fintech companies in the US and Latin America. We invest in pre-seed and seed companies, across payments, SaaS, infrastructure, compliance, anti-fraud, lending, office of the CFO, insurtech, proptech, and other verticals within financial services. Learn more at gilgameshvc.com or follow us on LinkedIn and Twitter.

About The Wharton School

Founded in 1881 as the world’s first collegiate business school, the Wharton School of the University of Pennsylvania is shaping the future of business by incubating ideas, driving insights, and creating leaders who change the world. With a faculty of more than 235 renowned professors, Wharton has 5,000 undergraduate, MBA, executive MBA, and doctoral students. Each year 100,000 professionals from around the world advance their careers through Wharton Executive Education’s individual, company-customized, and online programs, and thousands of pre-collegiate students explore business concepts through Wharton’s Global Youth Program. More than 105,000 Wharton alumni form a powerful global network of leaders who transform business every day. For more information, visit www.wharton.upenn.edu.