If there was one key thing you could do to secure your fintech firm’s future, what would it be?
4 June 2021
The unpopular answer is governance, one of the vital measures that companies need to adopt to ensure their businesses stand the course of time, but which was openly discussed at The Fintech Club recently.
Brought to the fintech community by The Mayor’s International Business Programme and Innovate Finance, and chaired by Julia Streets, founder and CEO of business development and marketing communications firm, Streets Consulting, the event featured senior industry players recently spotlighted in the Women in Fintech Powerlist.
I, Karen Rudich, CEO and Co-Founder of ELEMENTARYb, was invited to speak alongside guests including: Georgina Philippou, Senior advisor to the FCA; Sarah Kocianski, Head of Research at 11:FS; Janet Jones, Head of Industry Strategy at Microsoft’s Financial Services UK and Vicky Sanders, Global Head of Investment Analytics at Liquidnet.
Building Governance from Day One
As one of the event’s speakers, I was able to bring to the table my expertise on governance deployed when setting up the Eb financial platform. For me, governance is about good processes and having the right checks and balances in place to ensure you scale quickly. Previously a traditionalist when it came to governance, I came to realise that, rather than limiting it to a tick box exercise at the end, you can be pragmatic and build light-touch steps at the very beginning that set you on the road towards your ambitions. “We knew we were going to be doing fundraising at Eb and scaling-up very quickly, so governance to us from day one was key. This came in the form of having two experienced NEDs and a working board from our early days, even if our board meetings are short. Also, we wanted to have the right documentation in place (contracts, board packs, cashflow, etc.) as we knew that we would need this to clear due diligence with any investors. “
“Doing it the other way around – growing your new business successfully and retrofitting governance (because you have finally reached a size/responsibility level where it is critical) is very challenging because often it’s too late to do it effectively, requires extra expense, and can cause massive operational upheaval as you try to get your house in order.” This view comes from personal experience with my previous start-up.
Governance & Accountability
For guest speaker Sarah Kocianski, Head of Research at 11:FS, governance represents the processes in place that enables you to have a company with accountability. But a firm of five staff cannot always start off with formal governance so although a structure may not necessarily be in place from day one, thinking about good governance, and following certain principles can be. Accountability is key as a company grows.
She said: “You need transparency and accountability so everyone who joins the company understands how it works and understands where to go. So even if the strict processes aren’t in place when you start, you have to have them in mind as you expand. So you introduce people to the idea early on.”
What Financial Services customers want
Janet Jones, Head of Industry Strategy at Microsoft’s Financial Services UK, another guest speaker, said financial services customers were demanding clear policies, blueprint deployment compliance-checked, and audits that these criteria have been met.
Without these things in place, she said it was “very hard” to sell into the financial services industry. While costly, ultimately it was very important early on to get that balance of governance versus the speed of deployment.
Julia Streets, CEO and Founder of Streets Consulting, concluded: “In the fintech world we often talk about compliance, far less the importance of governance, and it was a really refreshing and insightful discussion. Many speakers confirmed that a proactive attitude to governance from the outset greatly affects the culture of the organisation as it grows and plays a key part in appealing to and attracting the right type of investor.”
Author: Karen Rudich CEO at Elementaryb