Amping up your fintech game

NAVIGATING the uncertainty of the fintech market correlates with the BANI world challenges we live in today – a world marked by Brittleness, Anxiety, Nonlinearity, and Incomprehensibility. This instability primarily affected the venture capital market, with a 38 per cent dip in capital raised by fintech startups in 2022 compared with the year before. As someone deeply entrenched in the fintech landscape, I can say that the effect of the fintech winter on entrepreneurs and business leaders is undeniable.

Yet, amid these challenges, I’d like to reassure fellow entrepreneurs that the current market presents an opportune moment for strategic recalibration and a fresh perspective on fintech ventures. Drawing from my experiences as a seasoned serial tech entrepreneur, I made a conscious decision to expand into the Asian market with a B2B platform for cross-border transactions – a move I consider strategically sound.

Here, I’d like to share the lessons I’ve learnt while entering a new market, hoping to inspire fintech entrepreneurs to reassess their approaches and smoothly adapt to the new business environment.

Ask yourself the right questions

Whether you’re contemplating a new venture, considering an exit, or planning an expansion to a new market, maintaining a measured approach is key. The allure of creating something novel, aligning with personal passion, and delivering tangible benefits is undeniably exciting. However, a cautionary note – question an idea or product you’re working on. C-level executives and business leaders, shielded from external criticism, might embark on ventures with the assumption that someone out there needs it.

In essence, shift your approach from a firm declaration of “I know better” to a more inquisitive stance: “What tangible problem can I solve for the client and how?” Understand your clients’ pain points and seek innovative solutions. Avoid standard approaches, schemes, or methods that mimic other fintechs. While venturing into uncharted territory entails additional risk, the potential upside is significant. Replicating others may have a theoretical limit tied to existing entrepreneurs’ outcomes, but, in practice, it often provides worse results due to market dynamics and the wrong timing.

Team chemistry over ‘magic’ product ingredients

In my previous experience with a B2B fintech startup, I learned a valuable lesson: don’t bank on the illusion of exclusivity or “miracle ingredients” in your product. Instead, channel your energy towards ensuring quality, adopting a meticulous approach to product creation, building a reliable team with cohesive relationships, and welcoming constructive criticism. In my case, this strategy was instrumental in creating an outstanding product that eventually led to a successful exit.

In the process of launching a crypto-card, my team and I had a belief that this “wonderful feature” would be a highly sought-after solution backed by statistics and trusted sources. However, despite users’ willingness to pay nearly US$100 for the issuance of such a card, it failed to gain traction for daily spending. The reason? It lacked the benefits that regular non-crypto cards offered, such as bonuses, affiliate programmes, cashback and more.

Reflecting on these mistakes and conducting thorough data analysis, we switched our focus from the retail business to highly profitable private clients. This shift involved adapting to larger cheques and understanding the unique characteristics and payment frequencies of this clientele. Essentially, we iterated on the product through micro-pivots, leading us to a new value proposition that was significantly different from the original idea.

Embrace continuous learning – theoretical and practical

I firmly believe in the profound impact of education, both theoretical and practical aspects of it, on personal and entrepreneurial development. Despite facing health challenges during my childhood, leading to homeschooling throughout elementary school, this experience fuelled my enthusiasm for acquiring new knowledge and education. Later, I pursued an education in technical, engineering and mathematical fields, followed by a business education.

It’s essential not to divorce theoretical knowledge from practical insights gained “in the field” or from colleagues, particularly for business leaders. Education gains true value through application; knowledge must be wielded, or else the purpose of studying becomes questionable. For entrepreneurs, the process of constantly acquiring new knowledge represents one of the greatest pleasures and privileges. Witnessing the tangible benefits of applying this knowledge to create a product that serves clients is a source of genuine euphoria for the entire team.

Moreover, should you decide, as I did, to venture into new markets, the pursuit and application of new knowledge become vital. Whether it’s understanding market dynamics, learning a new language, comprehending a new client profile, or other aspects, a commitment to acquiring fresh knowledge becomes the linchpin of success.

Get ready for an exciting fintech journey

It’s almost impossible to make sweeping generalisations about the overall potential of the fintech market, as it varies for different products – some experience growth, while others face challenges. Nevertheless, I believe that there is, and always will be, a consistent demand for quality solutions and robust teams, particularly during times of market uncertainty. Today, the spotlight is on solutions and products that, in practical application (not just in theory), effectively mitigate specific risks related to investments, currencies, credits, transactions and more.

Moreover, the existing abundance and competition in the market are beneficial for us as users. Therefore, it’s crucial to delve into systemic risks and address the challenges faced by individuals, industries, and businesses. Investing in strong teams and embracing the inevitability of making mistakes are integral to navigating this dynamic fintech landscape. This field is truly captivating, offering a place for every enthusiast to contribute and thrive.

The writer is founder and CEO at international payment platform Uluky