Building a Fintech: 7 Key Lessons from Successful Founders

Paolo Dotta

26 February 2021

Roughly a year ago, I started reaching out to fintech founders to ask them about their startup journeys, and discover how they overcame the common hurdles of building a fintech. 

My goal in doing this was to bring valuable insights to our community of entrepreneurs. After all, one of the best ways to avoid pitfalls is to learn from those who’ve experienced them first hand. 

Fast-forward to today, and I’ve had conversations with all kinds of fintech founders, from ones who took their businesses all the way to unicorn status, to others who managed to achieve a successful exit before they even had a chance to launch!

They all offer a unique perspective on building a fintech startup, with their own insights on the hurdles founders face.

From those conversations, I’ve compiled seven key lessons any entrepreneur should have at the top of their mind when building a new fintech project.


1. Beware “Low Pain, Low-Frequency” Problems

Yaron Samid is a multi-exit fintech founder whose companies have been acquired by the likes of Microsoft and Cisco, to name but two.

Yaron is a regular lecturer at Stanford and Columbia business schools. He is the founder of TechAviv, one of the largest founder clubs in the world.

But before that, he founded BillGuard, an “anti-virus for your bills” that became one of the most popular fintech startups in the world. 

He told me about a lesson he learnt the hard way when building his product: 

Altar - What is Saying

When you’re launching a product you have to assess: 

How big of a “pain-point” is the problem?

How easy is the solution they currently have at addressing that pain-point and is that “good enough”?

In the case of bank fraud, our vertical, the consumer has zero liability. They pick up the phone, call the bank and say: “Look I have this big charge here I don’t recognise, it’s not mine please remove it.” 

The bank replies: “Ok no problem.” and they remove it. The bank does all the work.

So we had Low Pain + Easy Solution

On top of that here was one more deadly sin: low frequency. 

99% of the transactions on your credit card are absolutely fine. Someone rarely has fraud on their credit card. 

Even if there are hidden charges or mistakes, once you find them and get them fixed they don’t reoccur. The problem is solved.  

We were left with: 

  • Low Pain
  • Low Frequency
  • Easy Solution 

If you analyse it that way you would’ve never started that fintech company; you would’ve been dead on arrival. 

That’s the kind of teaching I do now for other companies; it’s a very important lesson: 

You have to carefully address: how big is the pain, how frequently does it occur and what are the existing solutions for addressing that pain.

Yaron Samid, Founder, TechAviv & BillGuard

2. Solve a Problem You Know Something About 

Alex Tonelli is a serial entrepreneur who, as a young entrepreneur, attempted to get a loan for his early ventures, a chain of fitness centres.

After experiencing the hurdles first-hand, he built a unicorn fintech startup that makes small business lending both easy and affordable for business owners. 

More than this, he is a partner of Endurance Companies where he leads a venture lab focused on building mission-driven companies in both healthcare and fintech. 

All of this to say, solving the right problem is something he knows a thing or two about as he shared with me in this interview

Altar - What is Saying

I can’t emphasise enough for new entrepreneurs the concept of starting halfway down the field

You ought to be careful when it comes to the products and the problems you dive into. Having authenticity to a problem is paramount.

People can get stuck into this religion of Lean Startup and convince themselves they can learn about any problem. I think that makes sense in the context of a large data set, but entrepreneurs only get a couple of chances at this. 

A lot of the startup literature is written from a Venture Capitalist’s (VC) perspective. It’s important to note that this is often misaligned with an entrepreneur’s perspective. 

In other words, a VC is happy to back 30 companies with lower chances of success so long as they have big potential outcomes. It’s an expected value calculation. An entrepreneur ought to be maximizing the chance of success. Personal authenticity to a problem is the best way I know to do this. 

Having said that, you shouldn’t blindly charge forward without having validated your assumptions. 

I’ve heard 20 authentic pitches for a “night club app” from a 22-year-old who has a very authentic problem – but didn’t validate the market size or the usefulness of the app to various other stakeholders.

Simply put, it’s not that you can’t solve a problem you know less about – but it’s going to be a lot tougher. 

Alex Tonelli, Co-Founder & Partner, Endurance Companies
Daniel, CEO of Altar, Product and Software development company specialising in building MVPs, full custom software development projects & creating UX/UI that is both functional and beautiful
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3. Don’t Underestimate the Importance of Your Product

Christian Nothacker built his fintech startup, PrestaCap, after spotting a gap in the market. 

While working as an early employee of another fintech, mobile payments company SumUp, he noticed that small business owners were facing major inefficiencies when it came to the financing process offered by traditional banks. 

So he built something better, and digitalised the process for business owners. 

Here’s one key lesson he shared with me in a recent conversation

Altar - What is Saying

You can have a great sales team, great marketing, great conversion, etc. But if your product is no good your clients will eventually go somewhere else. 

In the fintech industry, I think there are a lot of startups that don’t have an optimal product. There is, let’s say, quite a lot of room for improvement.

A CPO or dedicated Product Expert can be great when it comes to bridging the business vision and technology. 

It’s very important to know where the product is today and the direction in which it’s heading. If you don’t know these things, it’s extremely difficult to keep your product relevant and up to date.

Christian Nothacker, Founder of PrestaCap, CPO of DEPObank

4. Build to Scale from Day One 

In 2015, Forbes 30 under 30 entrepreneur Ankit Singh founded MyPoolin, a peer-to-peer fintech payments platform that disrupted the Indian fintech market.

Four years later, his fintech was acquired by California based fintech startup Wibmo. 

I sat down with him to hear his story, during which he told me one of the key lessons for him was the importance of building to scale:

Altar - What is Saying

While it’s important to test out your MVP with a few hundred users who will become your “super-consumers”. But you have to build it for scale from the outset. It’s a balanced approach that startups need to take.

And, nowadays, it’s a lot easier because the tools are there. Cheap cloud infrastructure is readily available and so on. 

So, building to get continuous feedback is an activity every startup should do. Especially, if you are building a business for millions and you want to go for funding or an M&A.

Ankit Singh, Forbes 30 Under 30 Entrepreneur and Founder, Mypoolin
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5. Don’t Try to Solve Every Problem Yourself  

Jan-Philipp Kruip founded  FitSense, a B2B health and fitness fintech app that is now being used by some of the biggest multinational insurance companies in the world.

In our conversation, he explained how some of his biggest wins came from his ability to trust. 

And one of the biggest lessons he learnt, was trusting the people he brought on board to help him build his startup:  

Altar - What is Saying

“If it’s very hard for you to trust people you’re going to have a tough time as a startup founder & entrepreneur. 

My basic premise is, I first trust people and they can lose that trust. In a startup environment, you don’t have time to build trust before you have to start delegating to someone.

If you’re someone who has a tough time trusting you need to take that into the hiring process. Ask yourself if you can trust that person from day one and start delegating. 

To put it bluntly: You simply will not have the bandwidth to control every aspect of your startup, you’ll burn out. The sooner you learn to delegate, the better.

Delegating has this wonderful side effect: 

The moment you trust someone they will take ownership of what they’re doing. Before you know it you can step away and watch this machine that you’ve created.

Jan-Philipp Kruip, Startup Mentor & Founder, FitSense

6. Trust is Key to Your Success

Dudley Gould started his entrepreneurial journey like most first-time founders

He had a great fintech idea, with the industry knowledge to turn it into a business vision. But he had no idea how to actually bring it to life. 

Here’s what he learned while trying to find a technical partner: 

Altar - What is Saying

Expect more than a few bumps along the way and prepare to be persistent.

You’ll make mistakes, people around you will make mistakes and everything takes longer than you would expect (this bothers me still today).

Ultimately, the secret to surviving the roller coaster is surrounding yourself with people you can trust. People who believe in your idea as much as you do.

Regardless of whether it’s a technical co-founder, CTO or an agency. Focus on finding the right fit for you and go for it

Dudley Gould, Founder, Audapio (Acquired by Circit)

7. Don’t Hesitate to Ask for Help

Giacomo De Lorenzo not only saw a problem that needed solving with his fintech startup Moneymour, but he also took advantage of every opportunity to reach out to his connections and gather feedback and advice on his fintech product.

This led to such a strong project foundation that it sparked the interest of fintech unicorn Klarna before Giacomo had a chance to launch.

In our conversation, Giacomo shared his incredible journey, including this key insight: 

Altar - What is Saying

Don’t underestimate the importance of being able to ask for people’s help. 

I wouldn’t have imagined I could have so much help from the people I talked to at the early stages of Moneymour, and their fintech advice had a hugely beneficial impact. 

Let me give you an example:

Our startup incubator was extremely helpful. But not all of the startups that were part of that acceleration programme made the right use of them. 

They were not calling them twice a day. Whereas I knew I had that opportunity so I took it, and it was very valuable for us. 

So embrace that ability to ask for help, it’s one of the most valuable resources you have. You’ll be surprised how many people will be happy to help.

Giacomo De Lorenzo, Founder, Moneymour (Acquired by Klarna)

Wrapping Up 

There are a few recurring themes that spring to my attention from these key lessons. 

Firstly, you not only have to solve the right problem, but you also have to be uniquely qualified to solve that problem.

Next, once you’ve found the right problem to solve, it’s paramount that you surround yourself with the right people to help you achieve those goals. 

Finally, don’t hesitate to reach out to people to ask for their help. Take advantage of every opportunity you have to gain feedback and advice.

Good luck & thanks for reading.

Paolo Dotta
Paolo started working in banking in Milan and London. After the financial career, he created a startup and then joined Altar where he mainly deals with business development and fintech projects.

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