"The fintech firm, which uses to artificial intelligence to modernize the lending process, was just hired by Wells Fargo, Cramer said. “I hope they make sense of what’s going on on the conference call because I really don’t still understand exactly how they are doing what they’re doing.”
We have seen many banks featured on the podcast end up becoming partners. This would be a huge surprise due to the size of Wells, did Cramer simply make a mistake or did he let something out that he is privy to?
Also, if you listen to the podcast or read the highlights on the link above, there is an interesting section:
When To Outsource or Build Internally
When deciding whether to build or outsource software, it is important to look at the level of differentiation and complexity.
Is the software too complex and not that different from what other companies are a master of? Outsource. If the software is different from anything else someone is doing while also not being that complex, build it internally.
You have to be honest with yourself when it comes to the uniqueness of software. Is it really that unique? Or could you find a company that already has the framework to build that software exponentially faster than you would be able to internally? This model must be taken into account to save time and money.
That’s exactly right. That’s why, when people say the larger banks move slow and are not early adopters, this may be an exception. If they can easily implement Upstart, increase loan volume and reduce defaults, why wouldn’t they? $$$$$$
Here is the quote from cnbc and a link to the page.
“Upstart Holdings
Q3 results after the close; conference call at 4:30 p.m. ET Tuesday
Projected EPS: 33 cents
Projected revenue: $214.9 million
The fintech firm, which uses to artificial intelligence to modernize the lending process, was just hired by Wells Fargo, Cramer said. “I hope they make sense of what’s going on on the conference call because I really don’t still understand exactly how they are doing what they’re doing.” “
One more note from Cramer, over a week ago, on his Investing Club email (from Oct. 26th). He mentioned Wells then as well (I get his emails and completely missed this). It sure does sound like Cramer is speaking based on his connections:
“Upstart downgraded from buy to hold at Jefferies… this is the strongest fintech with automatic, digitized lending… my contacts saying business great, mistake to downgrade… remember Wells, which is doing well, uses them… the end of FICO?”
Just speculation here, but it might make sense. Wells Fargo published back in September, that they selected nCino to enhance their commercial banking lending. So they are definitely a bit more open to digital change than other big banks in the U.S. and might be an indication that they are open to a partnership with Upstart.
WILMINGTON, N.C., Sept. 01, 2021 (GLOBE NEWSWIRE) – nCino, Inc. (NASDAQ: NCNO), a pioneer in cloud banking and digital transformation solutions for the global financial services industry, today announced that Wells Fargo & Company (NYSE: WFC) has selected the nCino Bank Operating System as a foundational technology platform to accelerate its digital transformation within its commercial banking and corporate & investment banking businesses, and to transform its commercial lending operations.
If Wells Fargo and Upstart are going to announce a partnership soon, this might be huge!
Cramer gets a lot of things wrong, but he has been on this Upstart/Wells thing. As noted in post above, his Investing Club email from Oct. 26th mentioned Wells. That same note from the email also mentions his contacts “saying business is great”.
Probably no point speculating any further, earnings are all that matter now, hoping for a good report on Tuesday.
I owe Falling Wallenda an apology for my prior comment. I’ve asked for it to be removed, too. It’s not 100% wrong, but it’s not 100% right and adding to the confusion about the Wells Fargo rumor is not helpful.
I stick by my assertion that Twitter is both a cesspool of lies as well as a great resource, though.
So, I’m sorry about the blunt, terse reply above, because if I had read more of the board before posting I’d have realized both that a document S-1 (probable source of confusion) does in fact exist, and that the document is really old. On reading that document, it appears that Wells Fargo acted as an investment bank on the creation of some Upstart Preferred Shares, based on my reading of the document. That S-1 does not appear at the SEC in the Upstart stock filings, so part of my plan for today just became to learn whether that document is in the SEC’s website somewhere and how to better use the tool and find even more complete information there.
I’d just add that of all the times that we all discuss our investments, the weekends are the time when we should feel the least pressure to act or communicate fast; nothing is going to happen to our investments on a Saturday or Sunday (that we can change). So chasing down this Wells Fargo rumor doesn’t have to be done in a series of short posts on the boards. (I clearly jumped into that ‘mode’ too.)