Yahoo Finance sits down with CEOs of top companies to discuss a variety of topics, including crypto, the restaurant industry, and buy now, pay later.
Coinbase (COIN) CEO Brian Armstrong explains why “crypto is the future of money.” “It’s not just a speculative asset class. People are now using it for all kinds of different types of utility. And we always believed that the industry would of evolved in this kind of three pillars,” Armstrong says, starting as an asset class, then becoming a new type of financial service, and the third pillar of “crypto as a new type of application platform.” “Crypto is here to stay,” Armstrong adds.
Chobani Founder, Chairman, and CEO Hamdi Ulukaya explains what he has learned from the business. “If you are going to start something to make it a meaningful player or do a disruption, there’s no shortcut… You have to be patient,” Ulukaya says. You are “going into wild waters, competing and facing with large CPGs.”
First Watch Restaurant Group (FWRG) CEO Chris Tomasso discusses what the restaurant industry is seeing from the consumer. “The consumer still cares very much about… hospitality and about gathering,” Tomasso says. “Consumer confidence is up… What consumers look for in restaurants are consistency, value… There's a consumer selected quality right now. They want reliable, consistent, friendly service that's at a value and high quality foods.”
Marqeta (MQ) CEO Simon Khalaf explains why “the consumer is benefiting from buy now, pay later versus traditional credit cards” and how AI will curb consumers' spending if they are unable to pay their buy now, pay later loans. “In credit cards, your APRs… is anywhere between 22 percent and 29 percent,” Khalaf notes, “while in buy now, pay later, it’s actually interest free.” AI is “underwriting decisions in a fraction of the second and it can actually curb the spending if consumers reach a certain point,” where they are unable to “pay back the buy now, pay later loan, it can automatically curb it down.”
VantageScore CEO Silvio Tavares notes the three things the company is seeing from consumers. “Consumer confidence is high. We’re also seeing credit card balances increasing. But cause for concern… delinquencies are actually also rising,” Tavares explains. “There is definitely some risk on the horizon, but right now consumers are feeling good.” Tavares adds that “many lower income consumers… are increasingly maxing out their credit cards. And that is a big reason why they’re turning to buy now, pay later.”
Key video moments:
00:00:05 - Coinbase CEO Brian Armstrong
00:00:40 - Chobani Founder, Chairman, & CEO Hamdi Ulukaya
00:01:06 - First Watch Restaurant Group CEO Chris Tomasso
00:01:32 - Marqeta CEO Simon Khalaf
00:02:12 - VantageScore CEO Silvio Tavares
Video Transcript
[MUSIC PLAYING]
BRIAN ARMSTRONG: Crypto is the future of money, and that's already here. So it's not just a speculative asset class. People are now using it for all kinds of different types of utility. And we always believe that the industry would evolve in this three pillars. We feel-- like, it would start as an asset class. People would trade speculatively. Then it would become a new type of financial services.
And now we're even starting to see this third pillar come online, which is crypto as a new type of application platform. Crypto is here to stay. I mean, think about all the bad headlines, the enforcement actions, there were CEOs going to jail. And yet crypto prices are up 90% year-to-date.
HAMDI ULUKAYA: I learned in this business, if you are going to start something to make it a meaningful player or do a disruption, there is no shortcut. You know, you have to be patient. And you have to build infrastructure and capability and brand and the trust. And you have to be going into a wild waters competing and facing with large CPGs that has been around for a long, long time.
CHRIS TOMASSO: The consumer still cares very much about hospitality and about gathering. And I think there's an underlying optimism. I do believe that, you know, consumer confidence is up. I think that what consumers look for in restaurants are consistency value. And I mentioned that in previously that there's a consumer flight to quality right now. They want reliable, consistent, friendly service that's at a value and high quality foods. And that's what we deliver.
SIMON KHALAF: In credit cards, your APRs are approaching, which is the interest you pay, is anywhere between 22% and 29%. While in buy now, pay later, it's actually interest-free. So the consumer is benefiting from the buy now pay later versus traditional credit cards.
You have AI that is doing underwriting or underwriting decisions in a fraction of a second. And it can actually curb the spending if consumers reach a certain point that their inability to pay back the buy-now-pay-later loan, it can automatically curb it down.
SILVIO TAVARES: We're seeing three things. Consumer confidence is high. We're also seeing credit card balances increasing. But cause for concern, the third thing we're seeing, is that delinquencies are actually also rising. And so I think there is definitely some risk on the horizon. But right now, consumers are feeling good.
Many lower-income consumers, and we define those as typically as $50,000 in income or less, those consumers are increasingly maxing out their credit cards. And that is a big reason why they're turning to buy now, pay later.
