Key Capital Corp (KCPC)

[zforce]

I’ve been doing some reading to wrap my head around these round up apps discussed in KCPC's latest news relase. The GoldVault deal does look promising, especially with Key Capital’s aligned involvement in mining. KCPC started out as a precious metals streaming company, and they have a lot of expertise in sourcing gold supplies at advantageous prices. After reading the articles that I’ve linked at the end here, I’m pretty excited about the opportunity to sign on. I currently use a feature with my Wells Fargo account that transfers $1.00 to my savings account every time I write a check or use my debit card. It’s a nice way of accumulating some extra savings……but the investment potential of some of these new round-up financial apps adds the potential of investing/leveraging those savings more effectively. And one of the articles talks about a feature where you can use the app to fund pre-tax retirement accounts. Anyway….here’s some info I’ve found. I think it will give you a better idea about how many people out there are flocking to these new alternatives to the old banks.

Offering gold accounts is not new – but doing this as ‘gold savings accounts’ that pays 9% per annum in gold is novel and potentially a game changer in what is a massive traditional global savings market that in many places pays less than 2% in annual interest.
Logic suggests that having an account in gold with (1) its upside value potential AND (2) getting 9% interest could position GoldVault to quickly capture a good share in the savings market
The ‘Round Up’ App angle tackles the savings market sector that is sweeping the world as this market targets the many millions that currently do not save. A 2017 Go Banking Rates article highlights the opportunity in USA and other western countries would be expected to have similar statistics – 57% have less than $1,000 in their bank Account and 39% have zero – this is a potential massive market (Seehttps://www.gobankingrates.com/about/press-releases/americans-less-1000-savings/).
Round Up accounts are simply accounts tied to your debit card that “rounds off” each purchase to the next whole dollar and deposits the difference into your savings account – in the case of GoldVault this is in gold as I understand it. The rounding up at least makes saving easier and almost not noticeable for the millions that are currently not saving – seems to make sense.
The Round Up market is reported to be largely pioneered by Acorns, and started gaining solid traction from 2017 with many of the mainstream banks joining in as well – such as JPMorgan (Finn); BoA (Keep the Change); Lloyds (Save the Change), and ING (Everyday Round Up).
Seemingly typical of this Round Up sector, Acorns has raised over $200 million; has about 5m Accounts; billion USD valuation, but is not yet operationally profitable. Similarly, Revolute raised US$71m in Oct 2017 at a valuation of US$350m, then a further US$250m at a valuation of US$1.7B just six months later and has since doubled its accounts to over 4 million in the past 12 months - but is also yet to report sustainable profits. It will be interesting to see how the GoldVault deal compares operationally as this information becomes available.
Figure that with an interest rate of 3 to 4 times that of bank savings accounts, it should not be long after they launch that GoldVault will have a quick 3 or 4 million accounts – and then what value would it be? Looks like a great Key Capital opportunity for the share deal announced.
Some Quick Search links – there are many and DYOR:
https://mashable.com/2017/03/25/savings-apps-review/#n8d0RChR8sq1
https://www.cnbc.com/2019/01/28/fintech-start-up-acorns-valued-at-860-million-after-latest-funding-round.html
https://finance.yahoo.com/news/spare-change-investing-app-acorns-now-manages-1-billion-195554934.html
https://www.forbes.com/sites/oliversmith/2018/04/26/how-nikolay-storonsky-took-revolut-from-350m-to-a-1-7bn-valuation-in-just-six-months/#d1c05c86aa32