Q&A, Scaling Enterprise FinTech

Scaling Enterprise FinTech: with Artur Banach of Movens Venture Capital

This interview is part of Scaling Enterprise FinTech | The Handbook, launched in Mar. 2021 in partnership with SixThirty Ventures and Finovate Europe. The Handbook includes proprietary research on ca. 65 Enterprise FinTech scaleups in Europe, Q&As with 16 founders on their journey to scale, as well as insights from 10 leading investors and financial institutions. Whether you are a founder with an idea, an early stage startup looking for inspiration and learnings, or an investor or financial institution looking to understand the difficult but rewarding journey to building a world-class Enterprise FinTech firm – download the Handbook here http://www.fintechforum.de/sef/

1.​ A year since the first lockdowns- is this is a good time to be building or scaling an Enterprise FinTech (/ InsurTech) firm in Europe?

In the first stage of the fight against COVID-19, the most pressing problem was dealing with the current uncertainty. Many fintech companies, like the rest of the financial system, have even begun to overreact to the crisis. Many of them, including insurtech and proptech companies, have implemented cost-saving measures, including staff reductions. Since many of them rely on transactions and volume for revenue, a priority strategy has been to make sure that as much as possible is variable and fixed expenses are minimized.

In Europe and the fintech sector remains one of the most important areas of innovation across the continent, particularly in large countries such as the UK, Germany and France. It can be seen that the above trends are generally positive for fintech innovators. Total VC investment in 2020 in fintech companies was slightly higher than in 2019, with scaleups rather than early-stage startups being the source of growth. Against this background, Polish fintech scalups and startups still have a lot of catching up to do, but I’m sure that in a few years from a group of companies such as Verestro, Nethone, Creamfinance, CashDirector, Fenige.com, Autenti, Symmetrical.ai or Uncapped will grow into important players in Europe.

2. ​What’s working and what’s not in B2B / Enterprise sales in the current environment?

Overall, B2B sales in the COVID-19 era are more difficult than before. However, we are also seeing more and more businesses have invested additionally in sales and marketing and are building a customer base outside their home market. The current situation favors openness to new suppliers, especially if they solve the problem clearly better than the current market leaders. From the Movens VC portfolio, two great examples are Vue StoreFront and Talkie.ai, which are rapidly expanding sales in the demanding US market.

 

3.​ In terms of investment focus: what’s in and what’s out for you? 

Disruption coming from AI/ML (process automation) , open banking services, hyper-personalisation and big data are at the top of our priorities.

 

4. ​What does it take to get to Series A today?

More and more evidence shows that the size of financing rounds at least doubled in the last two years. If you have >300% growth YTY and ARR EUR1-3M, you can expect a round’s size from EUR3M-EUR12M to accelerate your development.

5. ​What should startups expect or plan for in the coming months?

The reaction of markets and investors to COVID-19 shows that technology companies are seen as some of the best assets in the market (and rightly so). So overall, we are optimistic. Especially if you’re after an A round or can bootstrap, the coming years should be perfect for you.

Artur Banach

Partner @Movens VC, Warsaw-based, an early-stage fund investing in tech companies with global potential. Former entrepreneur and experienced investor (3 exits from tech companies with >10x ROI).