This thought leadership piece covers the following:
- FinTech market fluctuation and the importance of leadership
- What attributes and skills are needed as a C-Suite Executive to thrive in FinTech?
- Raising investment
Fintech has always been a dynamic, disruptive industry. Driven by the incredible development of technology over the last two decades Fintech, as we know it, has matured from a scrappy young upstart taking on the financial giants to become an established and respected sector in its own right.
Right now, it’s in more of a state of flux than ever before. And that makes it more exciting than ever.
A shift in funding has accompanied the industry’s new-found maturity. From the high-risk, high-reward venture capital investment of the industry-shaping startups formed in the banking crisis of 2008 to larger, more measured private equity investors taking an interest in the more stable, established firms that have grown from them, the landscape is more complex than it’s ever been before.
Add to that the general global financial landscape with the war in Ukraine, cost-of-living crises worldwide, the climate crisis and an unstable market, and securing reliable funding looks like something of a minefield.
That’s why exemplary leadership is vital for any Fintech company in 2023.
Different companies need different leadership at different points in their development. The right leader to hustle a startup from inception to market might not be the right leader to develop a mature company and find long-term, secure investment.
To be successful moving forward, Fintech firms must actively recruit the right leadership not just for the business they are now, but for the business they want to become in two, five or ten years. Potential candidates must seek out the roles that fit their career plans and offer the synergy for them to develop and shape both themselves and the company successfully.
Do you want to be at the bleeding edge of innovation, creating disruptive solutions and revolutionising how people interact with money? To motivate and mentor a talented generation that has grown up with Fintech and is brimming with new and exciting ideas? Are you ready to grab the Fintech sector by the horns and drag it into the future? If the answer is yes then a C-suite role in Fintech is perfect for your next challenge.
David or Goliath?
Ten to twelve years ago, when Fintech was in its nascent development phase, the landscape was much simpler. The ‘buzz’ around this new, disruptive industry resulted in a venture capital scramble to invest in up-and-coming startups with exciting new technologies. Many of those initial startups still exist today and have matured into professional multi-billion-dollar corporations.
Traditional financial institutions have had to embrace Fintech or die, leading to complex relationships between global banks and Fintech firms. Founders of early Fintech success stories have sold up and created new disruptive startups. Some startups have grown modestly and sustainably, maturing at a slower, more considered rate.
Navigating this complex landscape and placing the right leader with the right company requires expertise and a deep understanding of the Fintech industry.
Getting in at ground level.
New startups are often run by their founders – but not always. For the less experienced C-suite candidate, a leadership role at a relatively immature startup can be a fantastic opportunity to shape the company’s future and develop their own skills and reputation.
If you have a broad set of skills and knowledge – and you’re happy to roll your sleeves up and get stuck in – then you could thrive in a C-suite role at a Fintech startup. On any given day you could find yourself meeting with potential investors or shareholders, managing and supporting employees or even helping your tech team to produce the best possible product.
It takes a special kind of person to be involved with the vigorous, hands-on life of a startup and to simultaneously plan strategically for the future. But if you have the skills, the rewards are significant.
Leading a startup is an incredible opportunity to shape and grow the company to fit your own vision. You’ll have the autonomy to make decisions and direct the company’s trajectory in a fast-paced environment and you’ll grow with it, building your own knowledge and network as you go.
Of course, there are risks. A startup is by nature less stable than a more established company, and the journey to success will be challenging. You might also get a lower initial wage and fewer benefits.
But as a career move, in the long term, it can be incredibly rewarding. As you take the company from startup to established you’ll build your own expertise and authority, putting you in the ideal position to move to a leadership role in a more established firm. And if you decide to stay where you are, as the company becomes more successful and profitable and you demonstrate your leadership excellence you’ll be in a great position to negotiate for better terms.
Going big.
At the other end of the spectrum, a C-suite role at a large, well-established Fintech firm is likely to be extremely well-remunerated from the get-go. They will be looking for the very best leadership, and ready to pay for it. You’re also likely to see a great benefits package.
Working at a AAA firm brings with it massive kudos and the potential to expand your professional network and grow your reputation like nothing else. But landing a C-suite role at the very top companies is hard, and there are pitfalls.
Every decision you make will be under constant scrutiny, and you’ll need to be ready to justify any drops in performance or other blips. You might also find yourself constrained to a narrow path, with little room for creativity and innovation. And you’ll most likely be expected to be a leader in the traditional sense; you’ll be more detached than you might be at a smaller firm, with less opportunity to get ‘hands-on’ and involved with the day-to-day work.
Of course, this might suit you better. You’ll have the opportunity to really get your head into long-term strategic planning without tactical or operational distractions, and use your creativity and industry knowledge to come up with innovative solutions within a more restrictive framework. This can be more challenging than the free rein you might have working in a startup, but can also result in more satisfying, exciting solutions.
A company that’s already matured is unlikely to see the same level of growth as a startup that’s ready to make the transition to the big league. But that’s not to say that you won’t be able to take it to a new level in an ever-changing market, and the advantages in terms of pay and benefits will speak for themselves.
The middle way.
If a AAA role isn’t right for you, and a startup doesn’t appeal then there is a middle ground.
As startups grow and transition into mature, stable companies their leadership requirements change. A firm hand is needed to reshape them into operations that will appeal to the private equity investors needed to grow to the next level.
You’ll need to be able to head up a company that’s used to working in a scrappy, immature way and mould it into something more formal – without losing the core dynamic that has allowed it to break into the market. You’ll need to be a tenacious, talented fundraiser and you’ll need the organisational and emotional skills to inspire a disparate workforce that may be resistant to change.
If you have the background and knowledge needed then growing a mature startup into an industry stalwart can bring enormous rewards. You’ll have the opportunity to learn and grow with the company and set out how it works in the future. You’ll also develop the skills you need to lead a more established organisation if that’s a career path you choose to take.
If you’re already working in a C-suite role at a smaller company, or you have a good background of experience in a global head-level role and are ready to step up to the C-suite then this kind of opportunity could be ideal for you.
You’ll be taking the reins of a company that’s champing at the bit to grow. You’ll have the opportunity to put in place innovative strategies and plans for expansion with a level of autonomy and creativity that you’re unlikely to find at a AAA company while sidestepping some of the more esoteric challenges you may face at an immature startup.
Top role; top skills
Leading a Fintech company – at any stage of its journey – requires a unique set of skills and knowledge. Candidates coming from a C-suite role in another industry will need to quickly gain an in-depth understanding of the Fintech industry, with its complex regulations and constantly evolving technology. And candidates looking to step up to a C-suite post from a global head-level role within Fintech will need to be able to demonstrate the strategic vision and leadership skills that are essential to lead from the top.
Master of all.
There’s an old saying that goes A jack of all trades is a master of none, but oftentimes better than a master of one. But being a jack of all trades is not enough for a C-level role in Fintech. You’ll need to have a deep understanding of every area of the business you plan to lead, as well as ingrained knowledge of the financial landscape, Fintech and the regulations that constrain the sector.
This is where a background in Fintech is a huge advantage.
If you’ve worked your way through the ranks, spending time in different areas of the business then you’ll have an inherent understanding of the industry that can’t simply be learned. By heading up different departments and getting your hands dirty in disparate areas of the business you’ll have a better appreciation of how all the pieces fit together, and what strategic changes need to be implemented to elevate the company to the next level.
Long-term strategy.
Being able to plan strategically for the future is essential for any C-suite leader, but even more so in a Fintech company.
You’ll need to lay out a roadmap for your organisation over the next two, five, or ten years. You’ll need to read the market and predict changes, and proactively adjust your planning and goals accordingly. You’ll also need to accept and understand that Fintech is a volatile, fast-moving sector and that the goalposts will move.
So, you need the vision and nous to lay the foundations for your company to grow. But you also need to be ready to quickly and efficiently plan reactively when industry disruption occurs, to minimise business impacts and seize opportunities.
Regulation, regulation, regulation.
The Fintech industry is extremely highly regulated. It is also constantly evolving and changing as technology advances.
This means that a working knowledge of the regulations is not enough. A successful Fintech leader needs to have an innate understanding of the codes and structures that permeate the industry to be able to strategically apply them to the innovative, disruptive technology that is being developed.
You’ll need to diligently adhere to a complex regulatory framework while creatively developing new solutions.
Pushing the boundaries.
Fintech is all about pushing the envelope of what is possible and coming up with innovative new solutions. As industry regulations become ever-tighter this means that a Fintech leader needs a creative mind to fit state-of-the-art disruptive products into the existing framework without diluting core solutions.
You’ll need to think big. World-beating, epoch-changing solutions to problems that consumers didn’t even know existed. And you’ll need to be able to communicate the benefits of those solutions to shareholders, employees and potential investors quickly and clearly.
It’s not all hard edges.
Soft skills are vital. You can have the greatest business plan in the world and a granular understanding of every nuance of the Fintech industry and its regulations, but conveying the benefits of your company to investors and building trust and empathy with your team is just as essential.
And you’ll need to let that team grow organically. Like caring for a bonsai tree you’ll shape and mould your staff to suit your ends, but you’ll also need to know when to take a step back and let them find their own way. That means letting them make mistakes – and making sure they learn from them.
You won’t create a happy, motivated team by micromanaging them. But leading by example and inspiring them from the front lines, empathising with their needs and concerns and learning from their deep well of expertise will foster a community of trust and positivity.
Macro to micro.
As a Fintech leader, it’s essential that you can take in the wider picture. You need to be able to make sense of the wider Fintech market and your company’s place in it. You need to be able to make broad, far-reaching strategic plans and decisions based on that understanding and you must understand the consequences of industry changes both for your business and for Fintech as a whole.
But you need to be able to drill down too. To be successful in a C-suite role at a Fintech company you’ll need a microscopic eye for detail. The finance industry is built on accuracy and precision, and to succeed you’ll need to be the same.
Agility. Flexibility. Creativity.
Fintech never rests. In a C-suite role at a Fintech company, you’ll find yourself constantly adjusting to a changing market and changing technology. Disruptive new tech solutions can change the whole industry overnight, and a successful leader can pivot on a dime when needed, making confident decisions driven by thorough knowledge of both the sector and the company.
As well as a constantly changing industry, you’ll need to be flexible enough to switch from overarching strategic planning and decision-making to hands-on operational and tactical tasks – sometimes at the drop of a hat. You’ll need to know when you push your team for results and when to let them find their own way. And you’ll need to possess the kind of creative problem-solving abilities that can’t just be learned.
Data is king.
A successful CEO needs to be able to dig deep into the data and make decisions and plans based on analysis and research. That’s not to say there isn’t a place for intuition and gut feeling in Fintech; there is. But that intuition needs to be informed and backed up with hard data.
That means you’ll need to be able to brief your team as to what specific numbers you want to see, and how you want them presented. And you’ll need to be able to communicate that data both to clients and to investors.
No room for ego.
You’ll need to be confident in every area of the business to be a successful Fintech CEO. But you also need to accept that you can’t be an expert at everything. That means surrounding yourself with the best people and giving them the opportunity to thrive.
It means that you’ll need to quickly and efficiently assimilate the knowledge and data that your team supply you with. You’ll need to know when to accept that you’re wrong and adjust your plan accordingly, but you’ll also need to know when to push back with your own knowledge and agenda.
Raising investment
One of the key roles of a Fintech CEO is to raise the funds needed to allow the company to grow and thrive. Over the past decade, the Fintech sector has seen steady expansion, with a massive explosion of investment in 2021.
But this doesn’t mean that it’s easy to secure investment.
If anything, the Fintech industry is more saturated with competing products than ever before. That means you’ll have to work harder and smarter to prove to investors that your company is the right place to put their money for substantial rewards with minimum risk.
A unique challenge.
Fintech is still a young sector, driven by the rapid evolution of technology. Because it’s in a constant state of flux, you might not find the same established routes to funding that are present in older, more established industries.
Fintech is growing. But it’s also volatile and packed with competition.
The chances are if you’re chasing investment for an innovative Fintech startup you’ll be just one in a sea of fledgling companies chasing the same investors.
That doesn’t mean capital can’t be found; far from it. But it does mean that you need to be able to prove to investors why your company and product are head and shoulders above all the others.
Know the industry.
In its early days, Fintech was almost exclusively concentrated around Silicon Valley. Since then it has become far more diverse both geographically and by market. The US is still the most significant driving force in the industry, but opportunities are rife in cities across the globe. Despite an investment slowdown in 2022, Fintech is still growing faster than any other sector.
The Fintech industry is defined by the regulations it must adhere to. Being able to demonstrate a deep understanding of these regulations and convey how your solution offers a creative solution within them is essential to any investor.
Know your enemy.
You need to understand the competition. What other solutions are available? What makes them unique? What do they offer that your solution doesn’t? How much do they cost?
How can you beat them?
With this knowledge, you can accurately place your product or service in the market landscape. You can understand why an investor should choose your company over the competition. And that understanding could give you the edge you need to convince them to invest.
And if you don’t genuinely believe that you’re offering the best solution then you need to consider going back to the drawing board. Work with your team to ensure you’re offering the best solution to a genuine problem that needs solving.
Know your product.
When you have a world-beating solution, you need to know it inside out and back to front. You need to be able to explain quickly and efficiently why it’s the right answer to users’ problems, and you need an in-depth understanding of its features, benefits and nuances to field the questions that any investor worth their salt will come at you with.
You need to understand the underlying technology and what makes it special. You need to be able to explain the user experience and the problem that it solves. And you need to be able to justify why investors and users should choose your solution over the competition.
Know your team.
When it comes to your customers, you’re selling a product. With investors, you’re selling the company. And a company is nothing without people.
You need to know the makeup of your team. Their strengths and weaknesses, their experience, and their motivations. Then you can leverage that to show the strength of the company as an investment. Depth of talent and diverse skills are exactly what a savvy investor is looking for.
It’s also worth diving into the history of your team. Chances are they come from disparate backgrounds, and you may be able to exploit the connections and networks that are already in place.
Know your market position.
Different types of investors will have different expectations and demands. Understanding your company’s position in the market will help you to choose the right investment opportunities to target, streamlining the process of securing funding and allowing you to focus your attention.
If you’re seeking investment for a startup with an innovative, disruptive new solution then you’re likely to appeal to venture capital or angel investors. Both groups are likely to expect big returns quickly so you need to be confident that you’re ready to grow.
More established firms might attract the attention of the private equity investors that have been taking an interest in the Fintech sector more recently. They will usually expect a slower-burn return over a longer period and are likely to want a deep dive into your long-term strategic planning.
Know your investors.
There are a lot of potential investors out there, but not all of them are right for you. Doing your research and narrowing down the field to fit your needs can save you a lot of time.
Remember that with the right investor, you’re not just getting an infusion of capital. You’re gaining access to a deep well of experience and a wide network of contacts that could make the difference between success and failure.
You’ll need to make the most of any industry networking events that you can attend as well as online networking tools like LinkedIn to get the scoop on potential investors before starting to chase.
It’s also essential to understand how the state of the market affects investors. Fintech is a massive industry, but it’s always changing. Since 2010, over a trillion dollars have been invested in Fintech, with almost a quarter of that being since 2021. But that’s not to say that becoming a Fintech success is easy.
75% of venture capital-backed Fintech startups will fail, and that makes investors wary about where they place their money.
Get to know potential investors, what makes them tick and what they’re looking for in an investment and you’re halfway to finding the perfect partnership.
Know what you want – but be ready to compromise.
When you walk into a meeting with a potential investor you need to know exactly what you want and why. How much investment you need. What you’ll spend it on. What terms you want. What returns the investor is likely to see.
You need to be ready to lay everything right out on the table, but you also need to be ready to compromise.
Investors will know what they want from the deal. You know what you need to succeed. Your job is to find a middle ground that works for everyone.
Know when to walk away.
It’s important to be ready to compromise. But it’s also vital to know when that compromise is a step too far.
Any investor in your company will want it to succeed. That’s how they make money. But they don’t know the company or the solution it provides as well as you do. If the deal on the table is too risky then you need to be ready to stand up and walk away with your head held high.
There are other investors out there who are a better fit.
Know your plan.
It goes without saying that your business plan needs to be watertight. It needs to be built on a solid, sustainable foundation with projections for growth and safeguards to mitigate against fluctuations in the market. It needs to clearly define how your company will be profitable and how investors will benefit.
But it’s not enough to just have that plan in place. You need to be able to convey it to investors quickly and efficiently. And that means you need to know every nuance and foible of the plan.
You need to be able to answer the difficult questions that investors will have confidently and knowledgeably.
Take the plunge
It takes a special kind of leader to build a successful Fintech, and it’s a challenge like no other. But with that challenge comes potential rewards that you won’t find anywhere else.
If you have the skills and the knowledge combined with the passion and ambition needed to lead a Fintech into the future then now is the time to seize the opportunity and find your perfect role.
Read more about the history of Fintech – in our Fintech: a Brief History article.
Discover what leading lights of Fintech are predicting for the future of the industry in our Future of Fintech article – coming soon.
