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Medium Market Entry Market Sizing Financial Analysis

Chase-ing Equity

#Financial Services
ProHub Comment

This case tests market sizing fundamentals, entry strategy evaluation, and financial modeling. The interviewee must estimate the underbanked population, evaluate three distinct business models (brick-and-mortar, JV partnership, and neobanking), and calculate NPV. The analysis reveals that while financial returns are modest ($500K NPV), the case emphasizes impact investing and strategic positioning alongside profitability.

Estimated Time 26 minutes
Difficulty Medium
Source ROSS
20 / 100
Our client, Brandy Thomas-Chase (BTC), is a high-powered Black financial player and owns one of the most successful VC firms in the country. She has come to us with an issue near and dear to her heart. She believes that mid to large-sized banks have ignored an important potential consumer segment: the underbanked, usually found in underserved minority populations. BTC wants our thoughts on how she can leverage her firm to remedy this injustice, as well as how big this opportunity could be.

Clarifying Information

  1. Client is not currently in the banking space directly
  2. Client doesn’t have a threshold or an expected timeline in mind to recoup a return on the investment
  3. The main objective of our client is to increase access of some form of banking to underbanked populations
  4. Though they typically invest in somewhat established organizations, our client is interested in what taking on this project from the start would look like
  5. The assumption can be made that they will have the capital ready to take on this endeavor
Mock Interview
Interviewer

Our client, Brandy Thomas-Chase (BTC), is a high-powered Black financial player and owns one of the most successful VC firms in the country. She has come to us with an issue near and dear to her heart. She believes that mid to large-sized banks have ignored an important potential consumer segment: the underbanked, usually found in underserved minority populations. BTC wants our thoughts on how she can leverage her firm to remedy this injustice, as well as how big this opportunity could be.

You

Thanks. Before analyzing, I'd like to clarify a few key questions...

Interviewer

Good question. Let me provide some background information...

You

Based on this, I suggest analyzing from these dimensions...

AI Score
Structure Analysis Communication Business Sense Quantitative
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Practice this case with AI Mock Interview

A VC firm leader seeks to enter the underbanked consumer banking market to address racial inequity. The case requires sizing the ~15M underbanked U.S. household market, comparing entry strategies, and modeling a neobanking approach that yields $3M annual profit ($500K NPV). The recommendation supports the lower-return investment for its social impact and strategic benefits.

Key Insights:

  1. Market sizing uses a simple top-down approach: population → households → percentage underbanked to arrive at TAM
  2. Entry mode selection involves trade-offs between control (brick-and-mortar), capital efficiency (JV), and reach (neobanking/digital)
  3. NPV analysis should include realistic cost and revenue assumptions; the case flags risks of understated costs and overstated revenues
  4. Impact investing decisions may justify lower financial returns when aligned with mission and strategic positioning
  5. Regulatory complexity and customer trust are material risks in financial services expansion into underserved communities