Winners and also-rans

I bet you’ve heard that VCs are pumping money into “FinTech” (a short form for Financial Technology). FinTech is a genre of companies who use technology to disrupt the...

Snehal Fulzele 14th October 2015

I bet you’ve heard that VCs are pumping money into “FinTech” (a short form for Financial Technology). FinTech is a genre of companies who use technology to disrupt the financial services markets dominated by traditional large financial institutions. Venture capitalists put whopping $12B into more than 1800 deals in 2014. VCs are smart but they are also driven by market movement. And, today’s market is very pro-FinTech. It’s gotten to the point that companies who are traditionally called ‘specialty finance’ companies are re-branding themselves as “FinTech” companies simply because it gets VC attention.

competitive-advantageThis begs the question – how many of these VC backed FinTechs will survive? Can we predict? At the very least, can we find traits of successful FinTech companies early on?

I believe so.

Famous venture capitalist and entrepreneur, Andy Rachleff, outlines two criteria in order to determine whether a B2C business has a strong product market fit:

  • High Net Promoter Score (NPS)
  • Very low marketing spend

Most FinTechs are B2C and when you put these key success factors in the Financial Services context, you can narrow it down to the following two criteria to determine if a FinTech has a good chance to succeed:

  • Do they deliver a killer User Experience? (which drives NPS)
  • Do they have an extremely low customer acquisition cost? (lowest marketing spend)

At Cloud Lending Solutions, we get this. We get it way too well. From the outset, our mission has been to democratize access to cutting edge, next-gen financial technology and deliver it to small and large financial institutions to provide them an equal opportunity to be FinTech innovators. We have focused our core lending products on enabling excellent user experience and have introduced a new product to drive down the cost of customer acquisition.

We offer a comprehensive suite of financial applications to lending institutions to enable a superior user experience to their customers via a data-driven, analytical, simplified and frictionless approach to lending. We have recently released a whole new version of our CL Originate product that creates a fantastic user experience and increases customer conversion rates.

With such innovations, we believe we are giving any FinTech an opportunity to improve their probability of success and stomp their competition. If this sounds good to you, we’d love to talk!



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