1. Who are you?
My name is Erik Bogaerts. I have over 20 years of experience in information technology and the banking industry and managed quite a few large scale and complex banking IT implementation projects at various locations across Asia and Europe.
Today as the founder of Naqoda, I focus mostly on strategy and software development.
2. Which services do you sell and who are your competitors?
Naqoda provides a software solution to help banks facing more and more complex regulations in terms of withholding tax. Currently we focus on German Abgeltungssteuer, probably the most complex set of rules in Europe today. Going forward we are looking to extend the solution to include other countries such as Austria and France and also to cover the European Savings Directive. The added value of such a unified solution is quite clear to banks operating across a variety of jurisdictions as well as to our core banking partners who can address the withholding tax issue with one simple interface to our software rather than to have to interface to different systems in different countries.
This takes us to our competition and although we have local competitors in Germany, we haven’t seen anyone offering a cross-jurisdiction solution.
3. How did you get your start-up idea and how did you finance your start-up?
In talking to start-up banks in Germany I found out that there is a lack of solutions on the market and that the available solutions are cost prohibitive for a start-up bank. So I decided to start building a simpler solution, focusing only on the products required by the bank and gradually add functionality. This resulted in the Naqoda Tax Engine, a low cost, focused and easy to implement solution.
The company is financed by own capital and is profitable but we have started looking at attracting angel and VC investments to support our next growth stage.
4. What were the biggest challenges in starting?
To me the challenge is not so much in starting but in keeping going due to all the ups and downs you encounter on the way in building a company. You need to be quite stubborn and have thick skin.
5. What areas within FinTech do you personally find most interesting and why?
I would say, the regulatory areas are the most interesting. It’s incredible to see how much banks are spending in regulatory compliance. This spend in turn puts a brake on innovation at banks. I think that if Naqoda can make it simpler for banks to comply with regulatory requirements then we, in turn, can also free the way to more innovation at those banks.
6. What opportunities do you see for FinTech start-ups in the DACH region, and how can we help to accelerate it?
I think there is still a lot of work to do in terms of standardisation. For example, over the years I’ve seen hundreds of Personal Finance Management solutions but have never ever been able to use one to satisfaction as banks don’t have open and standardised API’s to really support such solutions.
Also, where you could help is in playing a role in simplifying the complex sales process when selling to banks. It is just so inefficient and costly on both the bank’s and the vendor’s side. The lack of transparency makes it particularly difficult for new entrants to compete. I think initiatives such as Bank ITX are a step in the right direction but still need a lot of work and a lot of evangelism to convince banks and vendors.
7. What tip would you like to give FinTech entrepreneurs?
Keep trying different things and when something works, focus.