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Scalability among Fintech Start-ups

Not to scale: Fintech Start-ups struggle to reach their potential virtue of the onboarding onslaught

While there is always an element of running before you can walk among start-ups, on too many occasions we encounter businesses who haven’t even bought their running shoes yet.

This especially, is an issue in the competitive Fintech space; where it’s an understandable part of human nature to try and master and perfect the early strategy that you’ve put in place. The issue comes from the fact that, if your grand strategy is as strong and sustainable as you want it to be, then you need to have planned for future phases as well.

In essence, scalability needs to become an integral part of the start-up philosophy if you’re to truly capitalise on the success you’re hoping for.

However, this isn’t to say that this is a simple process to carry out. In an industry that’s engulfed by regulation, governance and bureaucracy, there is every chance that a fast-approaching scaling phase can be derailed or curtailed by the time it takes to onboard vast swathes of new clients.

With this in mind, relieving some of that burden and placing change and scale phases in the hands of an outsourced consultant can pave the way for your business to maintain momentum and continue its upward trajectory.

Between a rock and a hard place

This is precisely the role that Match Performance has fulfilled for a range of clients over the years. Evolving our own skill base and offering in line with the rise of Fintech as an industry and ecosystem.

We assist not just the transition from start-up to scale-up, but through every significant transformation of requirements, environment or infrastructure. This often includes international expansion- as was the case with one prime example whereby a PaaS client was struggling to cope with the demands of its own exponential rise.

“This company had a growing client base which inevitably came with growing pressure to onboard them,” explains Match Performance’s James Fowler. “The company operates in a highly competitive market and rival firms are seeking to also onboard new clients as quickly as possible.

“However, this race to get ahead and secure revenue from new clients as speedily as possible is made challenging by a complex regulatory environment.

“The client was therefore stuck between a rock in the form of governance and a hard place in terms of regaining control of their successful development.”

When dealing with a PaaS model, the profile of their own clients varies quite dramatically too, further muddying the bureaucracy waters. There can’t be a one size fits all approach to onboarding when those you’re trying to onboard have different regulations, pain points, geographies and requirements of their own.

Creating a culture

In this instance, the issue had the potential to undo the client’s success story. Ordinarily striving for 10 new sales accounts each month, the onboarding train consisted of 76 client carriages at various stages of the transition. This meant that with no intervention, more than 100 sources of revenue would be caught up in paperwork by the end of 2020 – equivalent to 80% of our client’s entire annual business.

The results of such an issue aren’t just a complete stall of income, but dire reputational impacts as new prospects decide against joining the back of a seemingly never-ending queue.

With each week that passed, the onboarding delay meant they weren’t receiving enough business through the platform to match their scaling outgoings.

Reversing the situation required a multi-faceted approach, and that’s where we as consultants came to the fore. We laid out the following issues that needed to be considered and rectified – not only to remedy the current situation, but to create a culture and way of operating that would offset the possibility of this happening again in the future.

This included:

  • Tactically expanding the workforce to extend business capacity. If the existing Implementation Managers are getting caught up in email correspondence and technical queries, then they’re not project managing or actually solving client problems.
  • Tailoring the client touch points on a more individualised level to take responsibility of the end-to-end client journey. This aids both speed and the relationship.
  • Improving communication across the business so that, when a re-prioritisation occurs, behaviours from the wider team align and buy into it.
  • As part of this communication, establishing more transparent and clear roles for each stage of the client journey.
  • Undoing a lack of clarity across the client’s systems and data points. Visibility of expectations, actions, timelines and outcomes were all encouraged to ensure real-time insight for each client.

Tag in a third party

A lot of the later issues can be mitigated during the kick-off meeting, where a clear roadmap should have been laid out to drive accountability and enthusiasm on either side of the relationship.

In this case, however, it was about steadying the ship and, by the end of 2020, the client aims to have cleared the onboarding backlog, but in a sustainable way that will also avoid a repeat occurrence into 2021.

In just two months, the client’s onboarding performance was transformed, evidenced by 50 new clients between September and December, compared to an average of four a month between January and August. This number is expected to reach more than 100 by January, which will be compounded by an improvement plan for 2021 to embed a more sustainable process in the long-term.

Realising that this couldn’t have been achieved as a burgeoning start-up, but only with the help of a third party, was the first step to realising their goal.

When you’re in the eye of the storm having had your smooth journey thrown off course, it’s not always easy to regain clear visibility and steady the ship internally. Part of being a scaling business is to overcome these challenges, but very few can do it entirely alone in a space so liable to change and outside influences.

To this end, rather than wrestling the anti-governance/control debate during a scaling phase, the time may have come to tag in a partner that can help you fight through the current situation, and flex your muscles as a stronger competitor in the future.

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