Why will fintech make the world safer?

As founder and CEO of Soisy, Pietro Cesati made time to write a book and provocatively entitled it “Manifesto of a bank without the bank“. To better understand his position and the world of the marketplace lending, which it is primarily dedicated to, we met and interviewed him.

In your book you explain in what ways fintech will make the world safer. How will that be?

In short, by eliminating the risks of banking crisis. Banks are at the core of our economy and have been one of the elements that have enabled our society to progress in recent centuries. Unfortunately, they have one weakness: their business model is fragile and periodically generates heavy banking crisis that have serious consequences for on both the economy and society (just think of the still evident effects of the 2008 crisis.
One of the main innovations of fintech is the marketplace lending, or lending between privates, which divides the role of the bank over a multitude of people who finance loans, thus eliminating the single point of fragility represented by the bank.
A good example of what happens in a crisis if risks are distributed can be found in the bursting of the dot.com bubble in year 2000. The size of the bubble was huge, but the consequences for the economy as a whole were limited, because risks were very distributed and banks scarcely involved. When the real estate mortgage bubble exploded in 2008, the consequences were much more serious, because this time banks were involved.

Marketplace lending: how does it work and what advantages does it give to customers and shareholders?

Marketplace lending introduced the concept of the platform to the financial world, just as Airbnb has done in the world of tourism. Airbnb does not own the homes it offers for rental, but simply puts owners in touch with tourists interested in renting them. Similarly, marketplace lending platforms do not own the money they lend, but merely put investors who want to lend them in touch with applicants who need a loan. For investors it is a way to get higher returns than the market (for example Soisy gives returns between 4% and 8%). For borrowers it is a way to have an efficient, transparent and, usually lower cost, service.

But the most interesting part is that all this is possible because the marketplace lending aligns the interests of customers and shareholders more easily, while banks face a trilemma: the impossibility to satisfy customers, shareholders and regulators at the same time. Considering that in this historical moment, with the effects of the 2008 crisis still visible, they are focused on regulators and shareholders, those who suffer most are the customers.

Marketplace banking: what is its definition and what are the benefits it gives to customers and shareholders?

Another of fintech’s new features is the creation of companies that offer very specialized services, with a great ability to work together offering all the services of a traditional bank in a harmonious way. Marketplace banking is this mixture of specialization and collaboration in offering services to clients, which could lead to the emergence of real marketplaces specialized in integration and not in the production of different financial services. In this way, clients can benefit from high quality services resulting from the extreme specialization of those who develop them, but also from the convenience of being able to access to different services in a single place.

Are the increasingly frequent alliances and synergies between banks and fintech in your opinion changing the end customer’s perception of the world of banking and finance?

I don’t find bank-fintech alliances so frequent and I don’t think that the ones there have changed the perception of customers. In general I find that banks are still not very interested in fintech and slow in deciding how to approach it. However I see a slow improvement growing, with increasing customer focus, which will inevitably drag the banking sector towards fintech in the long run. This is good, because collaboration is one of the pillars of the digital world.

We will only be able to say we have brought the fintech revolution to the heart of finance when the entire industry asks itself how best to solve customer problems and how to do so together with the rest of the ecosystem.

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A new crowdfunding campaign for Soisy

A new crowdfunding campaign for Soisy after the great success of last year, again with 200crowd. Pietro Cesati, CEO & Founder, tells about the next goals and the growth registered.

How much has Soisy grown since its birth and how is it evolving?

Soisy’s growth is always capable of surprising us. For example, in September we achieved a result that was +50% compared to the previous month. Today in Soisy we are originating 900 new loans per month which mean about €10 million worth of transactions per year. When we think we started two and a half years ago and the first month we made 17 loans, it is certainly a remarkable growth and it does not seem to stop. In the last year, for example, we quadrupled. Being in a market we are still exploring, things seem still easy, and we believe that it will still be possible to grow at these rates for the next few years.

How did the collaboration with Afone start and what advantages did it bring?

The opportunity with Afone was born quite randomly. At the Netcomm forum last year a person looking like Johnny Deep approached our stand but was actually Roberto Galati, the Country Manager of Afone, a payment gateway, a company offering a package of payment methods to e-commerces. He was not amongst our typical customers at that time because we were mainly there to meet e-commerce, but his idea was to add Soisy as a payment method to the suite of payments he was already offering to e-commerce. We explore this idea with him since we very much liked it. It took us a few months to implement it, mainly to solve legal problems. Fortunately, there weren’t many technological problems because both Soisy and Afone are high tech-companies! For a few months now Afone has been offering Soisy’s instalment payment method in its suite. This means all Afone e-commerce customers can easily add the Soisy instalment option to their payment methods without registering on the Soisy platform or signing a contract with us. They don’t even have to make a technological integration. They just have to sign the deal with Afone and get their payment method. This gives them an advantage, gives Afone the opportunity to offer a better product and, of course, gives us the chance to reach a wider audience of e-commerces.

In Soisy you believe very much in smart working: what are the reasons for this choice?

Soisy’s smart working was born from the need to reach people who were valuable to us but had no intention of moving to Milan. The first person we hired in smart working was working at Osimo and we absolutely wanted to get him on board in Soisy. We started doing smart working to be able to reach more people. That is the main advantage: we can expand enormously the number of people with whom we can work, but that’s not the only benefit. By doing smart working for years we have realized there are many other upsides. For example, being able to concentrate, since modern offices and open spaces are places of mass distraction: being able to work alone at your desk is a huge value given by smart working.

Why a new crowdfunding campaign? With what objectives?

The new capital raise relates to the phase in which Soisy is currently. We have validated the product and the market. This is a phase of pure growth in which we do not want to have distractions coming from the funding needs. That’s why we are looking to raise capital for approximately two and a half million euros. That should give us the financial peace of mind to get to the breakeven and beyond. What is the goal of this round? Certainly to continue improving the product. At the moment we are the market leader on e-commerce instalment payments. However, the world is moving and we must continue to invest in the product to be able to by o maintain this leadership in a market that is huge counting tens of billions of euros in transactions each year and growing because it follows the trend of the transition from the world of transactions in physical stores to the world of online transactions. To do this we will leverage the same crowdfunding campaign as we did last year. Last year our campaign gave us great satisfaction both for the results and the type of conversations we managed to have with our investors who decided to participate and our members and journalists who were interested in the campaign. Again this year we have not hesitated to organize a campaign that will raise at least one and a half million euro, a substantial part of our capital increase. Just as last year it will be featured in 200crowd.

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Soisy & Swascan: two Italian fintechs accelerating with Startupbootcamp

Soisy and Swascan, two startups who’ve just concluded three intense months of acceleration at the Startupbootcamp FinTech & CyberSecurity Program in Amsterdam are Italian, and from our community! As we were curious about their experiences in the program, we caught up with them once they returned to Italy. How would they describe their 13-week journey in Amsterdam? What were their biggest highlights? Read on to find out!

But first, here’s a bit of context on Startupbootcamp, the global accelerator for startups. And who better to give us a closer look than Joost Bergen, the Managing Director & Co-founder of the Startupbootcamp FinTech Program in Amsterdam. Here’s what he had to say

1) What makes Startupbootcamp’s FinTech & CyberSecurity program unique?

Startupbootcamp is the world’s largest network of multi-corporate backed accelerators that helps startups scale internationally. Currently, we run over 20 industry-focused programs across 22 cities, worldwide. Specifically, in our FinTech & CyberSecurity programs, we empower innovation and facilitate effective collaboration between startups and corporates, coming from the banking, insurance and regulatory sector.

To date, we’ve worked with over 700+ startups and counting, across all the different programs and in the last 7 years, our FinTech-focused programs have been active in 7 cities across the globe.

What makes us unique is the way we work with the startups that enter our programs. Our focus is always two-fold: Firstly, we help them define their value proposition in the best and most precise way possible; Secondly, we connect them to potential partners, and support them in a growth process that makes them prepared to present themselves to potential investors.

All our accelerator programs conclude with a Demo Day. This is an event during which startups get to pitch their progress and solutions to over 300+ people. Of course, their journey with SBC doesn’t end there – after they ‘graduate’ from our accelerator programs, they join ‘Startupbootcamp NXT’ support program, where they’ll remain in our global ecosystem and are able to benefit from the various opportunities that are offered.

In 2018, relay, one of the startups we worked with 5 years ago, was acquired for 3 million Euros. We’re all really proud to have been part of their journey, from the early stages. What’s more, together with the other players in the Amsterdam FinTech ecosystem, we’re glad Amsterdam is considered as the main Startup hub in mainland Europe.

2) How do you select the startups that will participate in the program?

We look at the team, and then the team and, thirdly … the team. It is clear that for us the team is the most crucial element in our selection process. We select startups with a good and balanced team, with people from different fields working in synergy. The ideas and technologies used are also very important.

3) Looking at the FinTech startup ecosystem, what are the key challenges you’ve seen?

Many startups do not have a value proposition that is recognizable in the market. Often the ideas they pursue aren’t aligned with the needs of the market. Funding is another challenge that startups in this sector grapple with – they often don’t know how to raise adequate funds to move from idea to a market-ready product or service.

4) In the current international, economic context, what should a startup do to stand out?

For a startup, it is very important to know how to propose concrete technologies and solutions that can solve the problems of their potential customers or partners, like the big banks and financial institutions. It is essential to introduce yourself by clearly explaining what you do and what impact your business will have on end customers and on the financial and operational efficiency of the prospect partner and their end clients.

Essentially, a startup must be able to clearly explain the key benefits their product/solution offers, and what makes them unique compared to competitors. To be able to collaborate with banks and other key players in the financial sector they must also be able to demonstrate how they’ll be able to positively impact their respective businesses.

5) What are the top 3 tips you have for startups that are about to join SBC’s programs?

Be clear on the following:

– what is the problem you’re trying to solve?

– why is your product/solution what the market needs?

– what value do you bring to the market?

During the program, each startup will have the opportunity to better articulate their value proposition and learn how to explain why they are unique. Only 2% of startups who apply become part of the program. These are the ones that have the most balanced and motivated team and the clearest ideas on how to put themselves forward on the market.

Startupbootcamp according to Soisy

Let’s hear what Andrea Sandro has to say. He is the Product Development and Founder of Soisy together with Pietro Cesati and Marco Anzelmo. This startup is a peer to peer lending platform where everyone can take out a loan in order to purchase products in physical or online shops and has recently tied up a record crowdfunding campaign with another member of our community: 200Crowd.

1) How would you describe the Startupbootcamp experience to a startup that is interested in taking part in the next edition?

Startupbootcamp is a vortex that drains so much of your energy and at the same time infuses you with the same amount. It is a charge of pure adrenaline diluted in 3 very intense months. It is a huge network of people that we imagine as a great river, where you have the opportunity to capture the “fish” you want. In such abundance, the challenge is to balance the divergent phase with the convergent phase. It is necessary to really understand what you need. If you have a problem, however, you are sure that somewhere in that river will help you find the ideal solution.

2) What would you recommend to a startup in order to maximize the advantages of participating in the acceleration program?

Keep in mind what you are looking for and why you are participating in the program. Goals that are too general to be able to “grow” or “accelerate” are likely to generate unpleasant surprises. Once you have been selected you need to focus your resources on identifying the most promising opportunities you can find amongst the many that arise during the three months as they are all interesting but at the same time also distracting.

3) What should be expected and what should not be expected from the acceleration program?

What to expect: lots of networking, an excellent training on pitch and presence on stage, high-quality workshops and access to a network of corporate partners.

Don’t expect all your problems to be solved within those 3 months – during the accelerator, you will be laying down the foundations for growth, and as a company, you have to then spend the next months exploring this further

4) Has this experience changed your plans for the coming years?

We now better understand where it makes more sense to focus our resources. It was also an opportunity to validate, review and refine some of the internal processes of discovery and product design.

5) Can you list 3 things that you are bringing home after the acceleration program?

A network of high-value contacts, contacts for future investment rounds or partnerships, more awareness about our product and how to develop it.

Startupbootcamp according to Swascan

For Swascan these also have been three intense and fruitful months. Co-Founder Pierguido Iezzi tells us about them. Swascan is the first CyberSecurity platform in Cloud, SaaS & AMP, Pay for Use that helps companies identify, analyze and solve the vulnerabilities related to websites, web apps, networks and source code.

1) How would you describe the Startupbootcamp experience to a startup that is interested in participating in the next edition?

The program was very intense. It allowed us to look at our CyberSecurity Testing platform from every point of view, understand strengths and weaknesses, understand how to value the former and intervene on the latter. This has contributed to both the personal and business growth of the team.

2) What would you recommend to a startup in order to maximize the advantages in participating in the acceleration program?

To receive a maximum return in terms of expertise it is important to have your goals and priorities clear in mind. Do you want to carry out a first pilot project of your solution? Do you want to check if the target you are addressing is correct? Swascan’s solutions, for example, have been addressed to both a Large Account and an SME audience. Do you want to understand if the commercial strategy is correct and if there can be complementary channels? Do you have to structure a financial model that guarantees sustainability?

3) What should be expected and what should not be expected from the acceleration program?

It is an excellent moment of self-analysis and comparison with professionals who provide an external point of view to the project. Models and structures are provided that can be applied to the components of the business. One should not expect indications to be given or decisions are taken on behalf of the entrepreneur. SBC provides the tools and the vision to do it. For Swascan, expectations were met: we were able to convey our identity as a dynamic platform of Security Testing through a qualified and highly specialized network.

4) Has this experience changed your plans for the coming years?

Startupbootcamp has given us the opportunity to access some international contacts interested in the solution, now we are following these up by defining the subsequent commercial strategies. We are also talking with some investment funds interested in the rounds we are going to open to ensure an even faster international growth.

5) Can you list 3 things that you have brought home with you after the acceleration program?

Training: thanks to SBC we managed to get an overview of our IT security platform adding key elements for correct positioning.

Networking: getting in touch with decision makers and prominent people of the CyberSecurity sector has allowed us to widen our horizons and customize the offering to include the needs of larger accounts.

International vision: operating with an international perspective, Swascan offers its services through qualified partners all over the world and aims to expand its network more and more.

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