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?
Despite all the difficulties that 2020 has brought for entrepreneurs, some sectors have also benefited. We see Enterprise FinTech benefiting from an increased need for digitalization and for efficient operations in banking and insurance. As an example from the financial sector, Raiffeisen Bank International saw double-digit growth in its mobile banking users over the first half of 2020 (see here). This also creates many opportunities, which seem to have fueled investor appetite in 2020.
2. What’s working and what’s not in B2B / Enterprise sales in the current environment?
For startups especially cold-lead B2B sales have changed completely due to travel restrictions and tight cost budgets. Almost 90 percent of sales have moved to a videoconferencing. While some skepticism remains, more than half believe this is equally or more effective than sales models used before COVID-19. (acc. to McKinsey) Hence, it will be necessary to adapt the sales strategy and train the sales force accordingly. Well-structured and result-oriented corporate-startup programs, such as the RBI’s Elevator Lab, can be used as a bridge for B2B start-ups to directly contact new corporate customers.
3. In terms of investment focus: what’s in and what’s out for you?
At Elevator Ventures we are currently seeing exciting activity in the following areas:
- Beyond Banking & embedded finance solutions to further digitize value-chains across industries.
- Asset tokenization of real-world assets will enable new markets by decreasing barriers and frictions to information exchange and trade.
- Payment solutions, that are able to win e- & m-commerce merchants, via value added services and not mere fee competition.
4. What does it take to get to Series A today?
In general VCs are becoming more vigilant about the robustness of business models and the flexibility in turning from high growth marketing expenses to a profitable core business and be able to adjust runway to external funding environment. Therefore, it is important for founders to prove that they are able to steer their organization proactively and establish a crisis-proof business. At Elevator Ventures, we are relying on 15 distinct investment criteria, that are centered around sustainability, but also traction, growth potential and the experience of the team.
5. What should startups expect or plan for in the coming months?
Startups can expect that changed customer behavior in many areas is here to stay. In addition, the trends mentioned before are currently opening new business opportunities. We learned that having investors on board who can realistically assess the risks and opportunities in a FinTech’s particular business and geography was even more important over the last year. Elevator Ventures can build on deep industry insights and regional developments relevant for FinTechs in Central and Eastern Europe.
Maximilian Schausberger, Managing Director at Elevator Ventures
Maximilian Schausberger is Managing Director of Elevator Ventures, the Corporate Venture Capital entity of Raiffeisen Bank International. Elevator Ventures’ primary focus is on early stage and growth investments in fintechs and related enabling technologies in Central and Eastern Europe. RBI Group’s expertise, network and corporate strength helps Elevator Ventures’ portfolio companies to expand across this dynamic region and beyond. Maximilian has been a fintech fan from day one and is a frequent speaker at international fintech conferences. Forbes listed him on 30 Under 30 in the investment category.