Launching a fintech company is one thing, but running it successfully is a whole different challenge. As our founder, John Downie, outlines in his article for Startups Magazine, once you have the idea and the funding, the real journey begins. Fintech is fiercely competitive, requiring companies to not only stay ahead of their peers but also operate within strict regulatory boundaries. Here are John’s key principles to keep in mind for those stepping into the fintech space.

Validate Early, Build Little

"Build as little as possible early, and validate as much as you can."

In his experience, spending significant time building a product before knowing what customers really want can be a mistake. Instead, validate your concept early—whether by gaining initial customer interest, gathering feedback, or even securing early sign-ups.

He advises, "Do what is unscalable until you need to scale." As an example, this might mean putting in the groundwork yourself, even if that means handing out flyers to acquire the first few customers. This hands-on approach not only drives revenue but also gives founders a real feel for their customers and market.

Define and Focus on Your North Star

In the noise of a busy business, focusing on a "North Star" metric is essential. For SteadyPay, John’s North Star has been customer retention, which is critical in a fintech industry where customer acquisition costs can be high. According to John, “You need to drill into the KPIs underneath. What makes it happen?” He advises founders to know their numbers inside and out and focus on the metrics that will drive the business outcome they're aiming for.

Keep Operations Lean

Running a lean operation is essential, especially in today’s competitive market. John’s approach is to have team members wear multiple hats in the early stages, ensuring maximum efficiency with minimum overheads. “Be ruthless with empathy,” he says, explaining that, if necessary, downscaling should be done thoughtfully and with care. SteadyPay, for example, had to make tough decisions in 2022 to keep the business on track. In a startup’s early stages, maintaining the company’s longevity sometimes requires difficult choices.

Understand the Fintech Ecosystem

In fintech, knowing where you fit into the ecosystem is crucial. Fintech is interconnected, and forming relationships can support cross-selling, distribution, and overall growth. John explains, "As an ecosystem player, a lot of the time, rising tides can float all boats." Partnerships and strategic collaborations can boost your business, but it’s also essential to understand where you stand compared to competitors and what sets you apart.

A Balancing Act

Running a fintech company requires founders to be adaptable and focused. As John advises, “Validate early, know your numbers inside out, and always keep an eye on that North Star.” Beyond that, fintech founders must remain mindful of their industry relationships, maintain resilience, and stay nimble in the face of changing conditions. While the fintech journey is undoubtedly challenging, when executed well, the rewards are worth it.

For more tips and insights on startups, check out Startups Magazine and tune in to The Cereal Entrepreneur podcast for interviews with industry leaders and innovators.

Source: https://startupsmagazine.co.uk/article-what-consider-when-running-fintech-startup

What to Consider When Running a Fintech Startup: Insights from our Founder