Treasury Management Is Not Broken, It’s an Opportunity to Make Money, Claims Bound CEO

Yesterday, June 6, was the final day of the Money 20/20 conference in Amsterdam, and it opened with a session exploring treasury management. Specifically, the topic revolved around whether treasury management is broken. However, one of the panelists explained that there is real money to be made in this sector.

New Opportunities in Treasury Management

The session was moderated by Melissa Donohoe, VP of Notion Capital. Meanwhile, the panel included several speakers, including the CEO and co-founder of Round Treasury, Pac O’Shea, as well as the founder and CEO of Bound, Seth Phillips.

Commenting on their reasons for moving into the treasury management space, O’Shea said that his firm started a few months before the crash of the Silicon Valley Bank (SVB). At the time, the company saw a concentration risk on the money side and the need of founders to sacrifice liquidity for yield with traditional banking products and user experience for trusts.

Phillips, on the other hand, said that his experience in software development for the gold market allowed him to realize that a lot of the best practices can be automated and thus improved considerably.

He also noted that there has been an increase in interest regarding the treasury space, and he was looking into the reasons behind it. What he found was that when venture-backed firms have $10, $50, or $100 million in the bank, interest rates are suddenly not zero. This suggested to him that it is very important that a business of this kind keeps its money.

There is Real Money in Managing Finances

Commenting on how things have changed, O’Shea added that people tend to look at Treasury and innovation in this space nowadays, and this is why founders and entrepreneurs are being drawn to it. They know there are opportunities in this space now, and all it takes is identifying them as quickly as possible and then acting on the findings.

As for why the sector attracted interest, he said: “I guess on the VC side, why it’s getting quite hyped, is because it’s essentially not new money for these businesses, it’s an expenditure that they weren’t looking at before.”

Phillips also added that both his firm and O’Shea’s are about being responsible with one’s cash, as well as about the value that passes in and out of the business. Looking back, he admitted that this was not very attractive only a few short years ago. However, things have changed, as people have realized that there is real money to be made or be saved in the way firms manage their finances.