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Michael Hsu, the former acting comptroller of the currency, is joining Core Innovation Capital as a venture partner, he tells Axios Pro.

Why it matters: The former top U.S. regulator who spent years policing bank-fintech partnerships is moving inside an early-stage firm that backs those startups.

Context: Hsu spent over two decades in government, most recently serving as acting comptroller of the currency from 2021 until earlier this year.

While at OCC, he also sat on the FDIC board and the Financial Stability Oversight Council.

Earlier in his career, he worked on the 2008 crisis response at Treasury and later helped supervise the largest global banks at the Federal Reserve.

Between the lines: In joining a VC firm, Hsu says he wants to "skate to where the puck is going" in a financial system he expects to be digital, AI-powered and tokenized.

To do so, he believes he needs to work directly with builders rather than "from a think tank" or "from an ivory tower."

Zoom in: Core Innovation Capital is an early-stage fintech firm focusing on "finance with a purpose" for everyday Americans and on infrastructure in regulated markets.

Hsu says Core's mission and its work in "operationally complex and heavily regulated markets" made the fit feel natural and lets him combine his experience in financial health, fairness and regulatory supervision with early-stage company-building.

State of play: Hsu will work with Core and its portfolio companies on an as-needed basis. He'll also split his time advising other firms and central banks and sitting on the board of the Financial Health Network.

He hopes to help founders map where they sit in what he calls a bank-fintech "supply chain," assess bank and vendor relationships, and think through regulatory expectations for AI, data use and consumer protection.

The intrigue: His new role gives him a front-row seat to founders building the same types of bank-fintech and AI-driven systems he and his former colleagues scrutinized.

During his OCC tenure, he was one of the louder voices in Washington on the risks posed by bank-fintech partnerships as regulators tightened supervision of banks that powered fintech programs.

His tenure also coincided with a wave of enforcement actions against sponsor banks and the messy collapse of banking-as-a-service startup Synapse.

What's next: Hsu says his expertise will be most useful to portfolio companies closest to the banking system or that heavily rely on AI and data, where missteps can quickly draw regulatory scrutiny or erode customer trust.

Exclusive: Former acting comptroller Michael Hsu joins Core VC

Hsu will advise fintech startups on bank risk and AI.

Michael Hsu, former acting director of the OCC

Michael Hsu, former acting comptroller of the currency. Source: Al Drago/Bloomberg via Getty Images

Michael Hsu, the former acting comptroller of the currency, is joining Core Innovation Capital as a venture partner, he tells Axios Pro.Why it matters: The former top U.S. regulator who spent years policing bank-fintech partnerships is moving inside an early-stage firm that backs those startups.

Exclusive: Former acting comptroller Michael Hsu joins Core VC

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