Small Startup, Big Bank

Financial institutions are actively looking for the latest and greatest technologies to support their digital transformation strategies. However, the partnership process is challenging for startups as they need to navigate through bureaucratic approval structures and legacy technology systems. For early-stage startups, this process is time-consuming and requires extensive resources with no guarantee of acquiring a paying customer in the end. From my experience working with banking innovation teams, here are a few things early-stage startups should consider while entering the banking sales cycle to increase their chances of success.

1) Make it easy for a bank to envision your startup solving a real problem.

Understanding a bank’s offerings and assets under management is just the initial step in determining whether your solution is a fit for the firm. The key is to ensure your solution aligns with the overall innovation strategy and your value is clearly expressed. Before the initial call, request for details on their use case so you can tailor the conversation accordingly. Come prepared with a sales pitch deck and/or a demo. Demos are a great way to showcase your product in motion. I would suggest creating one that is less than 10 minutes long to manage time in the initial conversation then showing a more detailed demo in follow-up conversations. If you partnered with a similar firm before, then be sure to state the value you created. If this is your first customer, then share the potential value (quantified when possible) based on your initial tests and consider offering product flexibility within the parameters of your current capabilities.

2) Ensure your runway and team can handle an intensive customer onboarding process

When preparing for the onboarding process consider the amount of time and resources needed to adequately support a large customer. Forecast expenses with a buffer for additional time and resources, anticipating that the customer may not make a purchase. This approach will allow you to assess your financial stability and reduce concerns about running out of funds before delivering the product. Additionally, gain a deep understanding of the legacy system to ensure implementation requires minimal work from the client. If your technology is not at its optimal level, ensure you have sufficient staff to provide robust customer support. Offering on-demand assistance can significantly contribute to your success.

3) Start with a small project then expand to the broader organization

You can decrease the time needed to showcase value by launching a pilot with a small team. This offers low risk with less barriers and the opportunity to get introduced to the bank’s infrastructure. Throughout the process, request for feedback so that improvements can be made immediately where possible. Even if you're starting small, it's essential to have a robust technical architecture that can scale to support a large enterprise and eventually replace a legacy multi-service solution. A successful pilot could quickly lead to expansion.

4) Be Transparent

Be honest as to where you are in your product development and if there are any issues. Allowing your customer to manage expectations would ease an already difficult process and may encourage someone on their team to become your champion.

-Kiswana