What’s Next for FinTech Leaders? - Part One

Our research findings indicate a greater need for more sustainable skillsets and investments. Some prominent recent events in the FinTech industry further point towards this, where in addition to VCs, the industry is being backed by traditional finance and tech giants. 

To name a few, the UK FinTech investment fund (backed by Mastercard, Barclays and the London Stock Exchange Group) was launched in August 2023, with up to £1 billion ($1.27 billion) in capital to help growth-stage FinTechs; Apple Card Savings (fronting for Goldman Sachs Bank USA) announced in May 2023, attracted nearly $1 billion in deposits and opened approximately 240,000 accounts within its first week, elevating them to the status of a neo bank. Singapore FinTech’s attracted the highest level of venture capital investment from 2019 to 2022, at US$34 billion.

Such developments and figures are impressive, indicating potentially the blurring of boundaries between the transformation of traditional finance and FinTech. However, successfully leading in a FinTech environment is not without its challenges.

The challenges facing FinTech leaders

FinTech leaders across UK, US and Singapore provided a deeper insight into key issues affecting the global landscape. The key challenges mentioned include: 

• Consolidation - a FinTech company’s survival is predicated on being fit and well-funded.
• Regulation - an expressed need for identifying fraudsters and a better path to banking licences and clear regulatory standards for new tech organisations.
• AI adoption and integration - polarising views were received as to its effects on business operations.
• Strong executive leadership - a mix of skillsets is needed, comprising traditional finance, technology, commercial and risk & compliance. These skillsets will need to be developed for different phases of growth in the short to medium term.

Below are a few of the notable insights shared by the leaders:

“Among the biggest challenge facing an operating executive today is to drive sustained growth from both existing and new market segments. This means constantly evolving the organisation to stay competitive with a combination of new and existing solutions.”

Consultant & Advisor, self-employed.

“Execs are not focussed on good business fundamentals - and when money dries up, things are not as good. There are lots of poorly run businesses that focus on tech rather than profit.”

COO, Card Solutions company.

“[In line with the stage of the business] the leaders need to change from the builders of the business to those who can take it to the next level.”

Exec CEO/Chair, Crypto company.

When asked to rank the top drivers of success for their organisation, not surprisingly, a strong executive leadership team that can grow and run the organisation for the next 12 months was consistently ranked amongst the top three drivers by these leaders. While curiously, only one leader ranked a strong Board and advisors as a driver for success. Other drivers such as funding, clear vision and strategy, right technology infrastructure and a strong customer base were ranked differently based on the maturity of the business and the current phase of growth.

At Odgers Berndtson, we have seen this through our work with clients and candidates as we provide our market mapping, succession planning, search, interim, assessment and leadership advisory solutions to their people challenges. A key response to the acceleration and breadth of change is the need to form trusted relationships, both inside and outside organisations.

From a leadership perspective, this highlights the importance of being able to grow and maintain authentic high-trust relationships. Such relationships need to be developed to a new ‘fraud-proof’ standard to enable confident communication internally and externally. This requires a mindset shift and a change of approach; it is no longer OK to rely on face-value or ‘gut instinct’ alone. Instead, organisations need to evolve to build and maintain resilient trusted relationship-led business.

Our continued discussions have unearthed further themes from across the industry, including the potential hinderance of newer technologies within financial services, how mistakes of previous eras such as dotcom and fixed income derivatives can be avoided, how collaborative cultures must be fostered and the importance of continuous learning at the leadership level to support development, through coaching and mentoring throughout the business. 

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This article was authored in partnership with Richard Plaistowe, Principal in the Financial Services Practice at Odgers Interim. 

Part 2 of this article, due to be published in early 2024, will explore these ongoing developments with FinTech leaders.

Follow the links below to discover more about our expertise or to contact your local Odgers Berndtson office, or share your thoughts with our authors.