Pipe Had Just $7.1m in Revenue, Burned $47m in 2024, Newly Leaked Docs Show
OCC Approves Five Trust Charters, Enova Is Acquiring Grasshopper, Fifth Third Expands Brex Partnership, Bank Trades Push Back on Durbin Cap Recalculation, Cross River Integrates Stablecoin Payments
Hey all, Jason here.
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Pipe Had Just $7.1m in Revenue, Burned $47m in 2024, Newly Leaked Docs Show
Pipe — which, as a reminder, raised funding at a valuation of $2 billion in 2021 — earned just $7.1 million in revenue in 2024 and burned nearly $47 million in cash to do it, newly leaked company documents show.
The newly obtained documents, which appear to have been prepared for Pipe’s Q1 2025 board of directors meeting held in mid-May, generally attempt to paint a positive picture of a company gearing up for the launch of a potentially game-changing partnership: Pipe’s integration with Uber.
The Uber deal, publicly announced this September, enables eligible restaurants on Uber Eats to access credit offers from Pipe directly within the Uber Eats Manager interface.
A board update offered by then-CEO Luke Voiles suggests that the Uber deal was an overriding factor in driving decision making, including Pipe’s planned expansion to other countries that Uber Eats operates in.
One slide attributed to Voiles notes, (emphasis added) “Our efforts to be ready for Uber and operating at 10x scale on four fronts — tech, operations, commercial value from day 1 and geographic expansion. We will be performing a bug bash specific to Uber readiness the week of May 19 and are on track to be live with Uber in the US in July, UK in August, Canada in Q4 and Australia in Q1-26 with additional countries to follow.”
Similarly, an update attributed to then-CFO Ben Goodyear categorizes as “P0” (top priority) investments necessary for “10x scale and diversification.” Goodyear described these costs — some $3.9 million for staff in engineering, product, legal, and business development/partner success plus marketing campaigns and SOC 1 compliance — as “no regret,” as they would “meaningfully lift the capabilities of the company even if Uber were not to proceed forward.”
The CFO update specified additional hiring to support the launch of the Uber partnership as a “P1” priority and, as a “P2” priority, incremental head count that would be needed after launching with Uber, in functions that include capital markets, accounting, and compliance.
Yet, despite publicly announcing the Uber partnership in September, Pipe didn’t make the additional hires it had envisioned, instead abruptly laying off about half of the company some two months later, in mid-November.
Pipe’s Base Case Forecast Originations Growing 5.5x From 2024 to 2025
In 2024, Pipe was in the midst of a pivot, winding down the original legacy business and developing and rolling out its small business lending offerings, dubbed capital-as-a-service and offered primarily through “embedded” channels.
This helps explain why the originations in 2024 were anemic, with just $80 million in loans deployed, according to the Q1 2025 board deck.
Forward-looking goals were aggressive, with a “base case” forecast of $519 million of originations in 2025, growing to $1.5 billion in 2026 and $2.4 billion in 2027.
The company took in just $7.1 million in revenue in 2024, while burning just shy of $47 million in cash. Pipe ended 2024 with $92.2 million in cash and $24.4 million in “cash in assets” (eg money Pipe used to fund its share of loans).
The company calculated that this gave it 39 months of runway, as of the end of 2024, at an adjusted burn rate of $3 million per month.
A detailed financial plan for 2025 envisioned the company growing revenue from $4.8 million in Q1 2025 to $25.2 million in Q4 2025, and increasing total headcount from 115 staffers at the start of the year to 150 at the end of 2025.
Per the plan reviewed at that Q1 2025 board meeting, despite the growing originations and headcount, Pipe forecast ending 2025 with $66.9 million in “total liquidity” (cash and cash in assets).
Though, with a forecast of just $31.4 million in cash by the end of 2025, Pipe likely would have needed to raise new equity had it fulfilled this forecast, as the company’s cash policy requires it to maintain at least 12 months of operating burn, likely a demand from its debt capital providers, Victory Park and KSD, or from its bank partner, First Internet Bank of Indiana.
What changed between the Q1 board meeting in May, with its aggressive growth goals and international expansion plans, and the Q3 board meeting, which immediately preceded the company’s November mass layoffs, remains something of a mystery.
The company’s statement described the layoffs as a hard but necessary decision to “shift to a leaner org structure,” but claimed the business was “strong and growing rapidly.”
That characterization, however, is difficult if not impossible to reconcile with the newly leaked documents, which show that, at least as recently as the Q1 board meeting this May, Pipe expected to be hiring more staff to support growing originations and international expansion thanks to the Uber deal — not abruptly firing half the company.
GoCardless Acquisition Likely to Compound Pipe’s Challenges
Pipe is facing more bad news: a major partner, U.K.-based payments company GoCardless, is being acquired by Dutch payments platform Mollie.
Pipe’s partnership with GoCardless, announced in October 2024, made Pipe’s capital offering available to GoCardless customers directly in its payment processing platform.
The deal gave Pipe access to some 80,000 GoCardless merchants, of which the lender classified 28%, or 22,615, as “Pipe-addressable,” though only 142 GoCardless merchants took advances from Pipe by the end of Q1 2025.
Mollie’s acquisition of GoCardless, announced last week, seems likely to mean Pipe will eventually be replaced as GoCardless’ capital partner, as Mollie offers its own lending product, Mollie Capital.
OCC Gives Conditional Approval To Five Trust Charter Apps, Releases Preliminary “Debanking” Report
Comptroller Gould has been signaling the Office of the Comptroller of the Currency is “open for business” when it comes to de novo charters, including for those seeking to engage in “novel” activities and digital assets.
Now, he’s delivering: on Friday, the OCC announced the conditional approval of five entities to form or convert to national trust banks: Paxos Trust Company, Fidelity Digital Assets, BitGo Bank & Trust, Ripple National Trust Bank, and First National Digital Currency Bank, the last of which is being formed by Circle.
The approval has been relatively quick, with the oldest application, Fidelity’s, having been submitted on June 11, 2025, and the most recent coming from Paxos on August 12, 2025.
Now that these firms have received conditional approval, they must go about actually operationalizing their proposed trust banks consistent with the business activities described in their respective charter applications.
First National Digital Currency Bank is part of Circle Group, the issuer of the USDC stablecoin. Circle has also applied to form a New York limited purpose trust company.
Circle intends to leverage that New York trust as the issuer of USDC, with First National Digital Currency Bank providing services to the trust that include managing the reserves of liquid assets backing USDC. First National Digital Currency Bank will also provide digital asset custody for its affiliates on a fiduciary basis.
There were just seven public comment letters on First National Digital Currency Bank’s application. Several of the comment letters argued “that the proposed activities do not align with OCC precedent with respect to fiduciary activities conducted by national trust banks” and that the OCC and the bank did not provide enough information or time for the public to meaningfully comment on the application.
Commenters raised a handful of other issues, including risks of “unsavory actors” gaining access to the U.S. banking system, the OCC’s ability to resolve the failure of an uninsured trust bank, criticisms of cryptocurrencies and stablecoins, and the importance of maintaining separation between banking and non-banking activities.
First National Digital Currency Bank’s preliminary approval carries the following conditions:
the bank must limit its activities to those of a trust company and activities related thereto;
if and to the extent necessary, the bank must conform, cease, or divest its proposed collateral trustee structure to comply with the GENIUS Act, any implementing regulations, and any other applicable laws and regulations that take effect in the future;
the bank must notify the OCC with 60 days prior written notice and receive a determination of non-objection if it intends to significantly deviate from its business plan or operations;
the bank must maintain a minimum of $6.05 million in tier 1 capital;
and the bank must maintain 180 days of operating expenses in eligible liquid assets.
And prior to requesting its preopening examination:
the bank must engage an independent external auditor;
the bank’s financial statements must be prepared on an accrual basis consistent with GAAP;
the bank’s president must serve as a member of the board of directors;
each person who subscribes to 10% or more of the initial stock offering must submit a biographical and financial report to OCC staff;
management and the board must maintain policies and procedures to address all OCC regulations, including the establishment of a robust BSA/AML/OFAC framework;
the bank must have a security program in place that complies with relevant interagency guidelines;
the bank must submit and receive a determination of non-objection to a complete description of its information systems and operations architecture;
and a letter must be submitted to the OCC at least 60 days prior to the bank’s proposed opening date indicating that all requirements have been met and requesting a preopening examination.
Finally, the bank must also:
apply for stock in a Federal Reserve Bank;
purchase adequate fidelity bond coverage;
adopt policies and procedures that ensure the safe and sound operation of the bank;
ensure all other required regulatory approvals have been obtained;
and the directors of the bank must own qualifying shares.
Ripple Labs Inc. received conditional approval to form Ripple National Trust, which intends to provide services to another Ripple subsidiary, New York-chartered Standard Custody & Trust Company (SCTC). Ripple plans to use SCTC to issue its RLUSD stablecoin, with Ripple National Trust managing the segregated reserve assets backing RLUSD on a fiduciary basis.
The OCC received nine comment letters on Ripple’s application, which raised largely the same issues as commenters did in regards to First National Digital Currency Bank’s application.
The conditions of Ripple’s approval and steps necessary to obtain final approval are largely similar to First National Digital Currency Bank’s, though Ripple National Trust must maintain at least $11.7 million in tier 1 capital.
BitGo received conditional approval to convert its existing South Dakota-chartered BitGo Trust Company to a national trust bank charter. BitGo plans to use the national trust bank for digital asset and fiat currency fiduciary services; ancillary custody services including settlement and clearing, wallet platform services, transfer services for digital assets and fiat currency, and key management; staking services; escrow services; and stablecoin issuance services.
In addition to explicitly fiduciary activities, BitGo will provide other services that are part of or related to its custody services; namely, trading services, clearing and settlement services, management services, and its wallet platform.
The OCC received two comment letters on BitGo’s application, raising many of the same issues that commenters brought up in regards to Ripple’s and First National Digital Currency Bank’s applications.
The conditions of BitGo’s approval and steps necessary to obtain the OCC’s final approval are generally consistent with the other trust charter applications, though BitGo’s tier 1 capital requirement is a minimum threshold of $8.7 million.
The structure of Fidelity’s transaction is somewhat more complicated. Fidelity received conditional approval to convert New York-chartered Fidelity Digital Asset Services to an uninsured national trust; to charter Fidelity Digital Assets Temporary Bank; and to merge Fidelity Digital Assets with and into Fidelity Digital Assets Temporary Bank. The somewhat convoluted create-and-merge is a byproduct of Fidelity relocating the trust bank’s headquarters to Boston.
Ultimately, Fidelity Digital Assets intends to provide cryptocurrency custody and trade execution services, as well as certain related services. Per the conditional approval letter, these services will be provided on a non-fiduciary basis and include:
(a) a digital asset custodial account;
(b) a transfer of assets service;
(c) a custodial cash account;
(d) digital asset trade execution services;
(e) digital asset services for individual retirement accounts;
(f) settlement as a service;
(g) collateral agency services;
(h) and digital asset reporting.
Fidelity Digital Assets intends to issue its own stablecoin and provide staking services, both on a non-fiduciary basis. The trust bank will also provide asset management services to affiliates on a fiduciary basis. Fidelity Digital Assets aims to serve retail investors in the U.S. and institutional investors in the U.S. and select other countries.
The OCC received three comment letters on Fidelity’s applications. The issues commenters raised were largely consistent with those mentioned in relation to the other trust charter applications.
The conditions Fidelity Digital Assets must meet are generally consistent with those of the other charter applications, though its tier 1 capital requirement is higher, at $25 million.
Finally, the OCC conditionally approved Paxos’ application to convert its New York-chartered Paxos Trust Company into a national trust bank. The bank intends to provide custodial services, including the custody of cash, securities, and cryptocurrencies. Paxos Trust Company also plans to issue dollar-backed stablecoins and gold-backed digital assets.
The OCC’s conditional approval finds that the bank’s proposed cryptoasset exchange, brokerage, and trade facilitation are permissible as operations of or related to a trust company, as these services facilitate and are related to a customer’s use of their custodial account.
Paxos Trust Company also plans to offer escrow, fiduciary agent, payment agent, and exchange agent services.
The OCC received three comment letters regarding Paxos Trust Company’s charter application, which are consistent with the comments made on the other charter applications.
The requirements for final approval are generally consistent with the other applications, though Paxos Trust Company’s tier 1 equity requirement is $15 million. The bank is further required to set aside $7.25 million to invest in its compliance programs during 2026 and an additional $8.5 million during 2027 in order to remediate issues identified in Paxos’ 2025 New York consent order.
Assuming the five entities meet their respective requirements, once they clear a preopening exam, they will be permitted to begin operating. Securing final approval for a trust bank charter is a milestone, but other potential challenges remain — specifically, for those trust banks that may seek access to a Federal Reserve master account.
The Federal Reserve has designated different tiers of review based on the type of entity seeking a master account.
National trust banks that are owned by a Federal Reserve-supervised bank holding company are considered part of tier 2. National trust banks that are not owned by a bank holding company (eg uninsured and not subject to federal supervision at the institution or bank holding company level) would be considered tier 3, which requires a stepped up level of review.
No entities considered to be tier 2 have ever had a Fed master account application approved, and only a single tier 3 entity, Numisma, has received approval for one. Notably, Numisma was cofounded by former Fed Vice Chair Randal Quarles, leading to speculation that Numsima received special treatment in the handling of its application.
ABA, CSBS Statements on Charter Approvals
The American Bankers Association, which represents a broad cross section of U.S. banks, and the Conference of State Bank Supervisors, a trade group that represents state financial regulators, both released statements that were cautiously critical of the charter approvals.
The ABA’s statement emphasized support for innovation, while flagging risks of regulatory arbitrage, saying (spacing adjusted and emphasis added):
“Today’s decision by the OCC to approve conditionally a group of novel national trust charters raises important questions about the scope and oversight of these institutions. While innovation in financial services can benefit consumers, it is critical that any chartered entity operates under a regulatory framework that appropriately addresses its activities and risks.
We are concerned that expanding the trust charter in this way, particularly for entities that may not engage in traditional fiduciary activities, could blur the lines of what it means to be a bank and create opportunities for regulatory arbitrage. Clear answers are needed to ensure the public and policymakers understand how these charters will be supervised and how risks will be mitigated.”
And CSBS reiterated its position about the limitations of what activities are permitted under a trust charter, with its statement which reads in part (emphasis added):
“The states will continue to monitor final OCC approvals for these entities and the future financial activities of the firms, and any affiliates, to ensure that they do not exceed the authority of the OCC relative to national trusts. For example, activities related to deposit taking, lending, or payments could violate state banking or money transmission laws. In these areas, the states reserve their traditional chartering and licensing authority and will be prepared to protect their consumers.”
OCC’s Debanking Report Is A Nothingburger
The OCC also released its “preliminary findings” from its review of large banks’ so-called “debanking” activities.
The OCC document comes on the heels of another related report, released at the start of December, from the Republicans on the House Financial Services Committee, though that explicitly partisan effort purported to examine “Biden’s debanking of digital assets” specifically.
The six-page OCC report, which covers the largest nine banks under its supervision — JPMorgan Chase, Bank of America, Citibank, Wells Fargo, U.S. Bank, Capital One, PNC, TD Bank, and BMO Bank — has been accurately described as something of a nothingburger.
As inputs to the preliminary document, the OCC says it has begun reviewing “thousands of documents” from 2020 to 2025 and nearly 100,000 consumer complaints “to evaluate whether bank policies or practices may have required, encouraged, or otherwise influenced the banks to deny or limit financial access to certain categories of customers or potential customers” and to identify potential instances of debanking.
Yet, the report does not cite a single example of an individual or business being “debanked” because of a viewpoint they held or the nature of a line of business.
Rather, the OCC finds that between 2020 and 2023
“the banks maintained public and nonpublic policies restricting certain industry sectors’ access to banking services, including by requiring escalated reviews and approvals before providing access to financial services…
The basis for these restrictions often extended beyond core financial risks and instead focused on the impacts to the banks’ reputation associated with engaging with certain industry sectors. Many industry sectors were restricted based primarily on how it might appear to the public if the bank provided access to financial services to these sectors, rather than for reasons related to the bank’s or the would-be customer’s ability to comply with applicable law or the ability for the bank to extend financial services in a safe and sound manner.”
The report enumerates nine industry sectors that the OCC claims faced restricted access from the nation’s largest banks:
oil and gas exploration, development, or production in the Arctic;
coal mining and coal-powered power plants;
firearms, firearms accessories, and ammunition manufacturing and distribution;
private prison construction and operation;
payday and payroll lending, consumer debt collection, and repossession agencies;
tobacco or e-cigarette manufacturing, distribution, and retailing;
adult entertainment;
political action committees and political parties;
and digital asset activities.
The OCC cites banks’ public environmental, sustainability, and governance frameworks and corporate responsibility documents from as far back as 2020 as support for its claims industries faced restrictions in their access to financial services.
As Georgetown Law professor Adam Levitin points out, “[b]anks don’t have to serve porn sites or crypto companies or payday lenders if they don’t want to. For any reason. Banks are free to discriminate against vegetarians, oboists, philatelists, anti-vaxxers, flat-earthers, antifa, Proud Boys, proud girls, cat owners (childless or otherwise), Whigs, Democrats, and people who part their hair down the center. They are unlikely to do so based solely on viewpoint or association (actions are another matter), but they are free to do so.”
Subprime & SMB Lender Enova Is Acquiring Grasshopper Bank
Grasshopper Bank is being acquired by non-bank subprime and small business lender Enova International in a cash and stock deal worth $369 million.
Enova is the publicly traded non-bank parent company to lending brands that include deep subprime small-dollar lender CashNetUSA, NetCredit, a near-prime lender that partners with CCBank and Republic Bank to offer personal loans and lines of credit, Brazilian consumer lender Simplic, and money transfer service Pangea.
Enova also is parent to SMB lenders Headway Capital and OnDeck, the latter of which Enova opportunistically acquired in late 2020 against the backdrop of the unfolding COVID-19 pandemic. (Full disclosure: I worked for Enova from 2011-2013, leading digital customer acquisition marketing for its CashNetUSA brand.)
OCC-chartered Grasshopper, founded in 2019, focuses on SMB and startup lending and banking, as well as featuring a banking-as-a-service / embedded finance line of business.
As of the end of Q3 2025, Grasshopper held about $1.4 billion in assets and about $1.3 billion in deposits on balance sheet. Through the end of Q3 2025, Grasshopper has posted net income of $7.5 million.
The acquisition has the potential to be significantly accretive to Enova’s business over time.
First, it may enable Enova to bring some or all of the originations it currently does through bank partners in house, capturing a greater share of the economics and giving Enova more control and predictability from a regulatory perspective.
Second, and perhaps more importantly, acquiring Grasshopper could substantially lower Enova’s cost of funds, thanks to Grasshopper’s deposit base.
Enova’s cost of funds was 8.6% in the third quarter, which is not surprising given the higher-risk segments the lender serves.
For comparison, Grasshopper paid a total of $20.8 million in interest expense in 2024 and ended the year with about $801 million in deposits.
In 2024, Grasshopper had an interest expense of 2.91% of average assets — meaning Enova could realize significant savings from funding its lending via Grasshopper’s deposit base vs. its current reliance on non-deposit sources, like warehouse facilities and securitizations.
The acquisition isn’t a done deal and requires Grasshopper shareholder approval and signoffs from the OCC and the Federal Reserve.
Enova’s focus on subprime lending — rates on its CashNetUSA product in Texas reach more than 500% APR, for example — seem likely to drive consumer advocacy groups to oppose the acquisition.
Still, given the current regulatory climate, it’s not clear how much (if any) weight policymakers at the OCC and the Fed may give to opposition from consumer groups.
In response to a request for comment on the proposed acquisition, consumer advocacy group the Center for Responsible Lending shared a statement which read in part:
“Enova has for years issued extremely high-priced loans that inflict serious financial pain on people – as seen in the sky-high rate of their borrowers who default. Enova has engaged in rent-a-bank schemes to try to evade state usury laws while charging people annual interest rates around 100% or higher…
Bank regulators should not greenlight the expansion of a financial firm whose business model depends on bilking people, many of whom already struggle to afford necessities like housing and food.”
Everything Else: Fifth Third Expands Brex Partnership, Bank Trades Push Back on Durbin Cap Recalculation, Cross River Integrates Stablecoin Payments
Corporate card and expense management startup Brex and super-regional Fifth Third are expanding the ways in which they partner. The companies announced last week that Fifth Third will leverage Brex’s infrastructure to power its commercial cards, including by offering Fifth Third customers Brex’s automated expense management capabilities.