Gaining insights into the realities of building a Fintech start-up isn’t easy – there’s so much hype in this space that we can lose sight of the daily realities of building a business in a challenging and competitive environment. I spoke to Chandrima Das, Founder and former CEO of Bento, a Singapore-based B2B2C and B2C digital wealth management solutions provider that was acquired by Grab in 2020.
The value proposition
The key to launching successfully is finding an idea that will attract both clients and investors. I asked Chandrima how she had arrived at Bento’s value proposition and she said the payments world has leveraged technology to become more efficient: core banking is being shaken up by smart, nimble players, but wealth management still has to respond to the opportunities offered by new technologies. This is their niche.
“The incumbents in B2C roles like Betterment in the US, Nutmeg in the UK, or Stashaway here in Singapore, all come into wealth management with the rhetoric that they can do it better for cheaper – but while consumers will try out these offerings, they won’t commit serious money.” Bento has evolved into an enterprise SaaS provider, providing digital wealth solutions that integrate with whatever systems or front end the banks may have – an approach in line with how the larger market is developing.
“The problem every bank and wealth manager has is the high cost of innovation. We can provide the solution that will empower their RMs to handle four to five times more clients than they can right now.”
Challenges and answers
I wanted to explore the many challenges to establishing a business in the region. Some relate to regulation and others to banks’ particular requirements. For example, it’s interesting to note that while many offerings are cloud-based, some jurisdictions don’t permit financial solutions to be cloud-hosted – meaning Fintechs must find on-premises or partly on-cloud solutions to satisfy local requirements.
There’s also the issue of banks’ complicated procurement processes. While management may be sold on the solution Bento offers, getting signed up as a supplier with the bank is challenging. “You can either build a product or be a champion enterprise sales team, and we are a product company,” says Chandrima.
Banks also need convincing that it is OK to share client data with a Fintech partner. Bento’s answer is to anonymise client data by automatically hashing client-identifying information – something they are very careful to highlight when in discussions with banks.
Finding the right mix of talent remains one of the most challenging parts of building a Fintech business. Bento decided it wanted Singapore-based developers. Hiring quality developers can take time – Bento wanted its core development to be complete in three years.
Patience and faith in the vision
To Chandrima, the key is for start-up Fintechs to have patience: “You have to raise capital and develop your solution simultaneously. In B2B enterprise sales you’re stilling to banks and financial institutions which takes time – six to 14 months.” Under this pressure, many Fintechs pivot away from their vision in the effort to make sales to banks or institutions: “If you choose to be a product company, stick to it,” says Chandrima.
