How to stay focused and driven while running a fintech enterprise?

Stephen

Good morning and welcome to the Devico Breakfast Bar! This morning, we have Nicolas Treppides from Moneygate, who's the Founderof Moneygate. Nicolas, first of all, tell us a little bit about Moneygate and what your business does.

Nicolas

So first of all, good morning, and thank you for having me! My name is Nicolas Treppides. I'm an entrepreneur. Moneygate is an electronic money institution that was founded a couple of years ago. Last year, we secured a license from the Central Bank of Cyprus in order to have a license that can serve across the European Union. Our model is we call it an alternative to the traditional banking. Basically, we are mainly dealing with corporate clients who need good technology, have many payments, many receipts every month, and want to run their business through digital.

Stephen

Okay. Thank you very much. And so the whole FinTech and the banking world, it's a very fast-moving environment. I mean, how would you describe that current situation, the opportunities in the FinTech space?

Nicolas

Yeah, I mean, you know, in recent years, there was a lot of skepticism for big companies, even banking institutions who shift from the traditional business and on the way they were used to do things. But, we've seen a great evolution. And you see a lot of FinTech companies that evolved the last 5 to 10 years and the valuations that they currently have.It's obvious that the market started understanding and appreciating the fact that technology is now here to stay. And, I know that there's always the debate whether technology has replaced the human factors.

It did in a way, but it did totally in a good way, if you're asking me, because it has optimized a lot of processes that would require in the past a team of 5 or 7 people to undertake a task. And now it's done by 1 person that sometimes is overlooking the procedures and the systems are run perfectly. When you think about it, the end result always has a benefit to a consumer because the cost eventually reduces to 0, because the cost of technology gets amortized. Whereas with the human factors, every year, we need to pay more, and more, and more in order to maintain. I think that technology really evolved, especially in the FintTech.

Stephen

Okay. We are going to talk a bit more about your business and some of the challenges you've had, but I'm going to wind it back a bit and let people understand a bit more about you. So you said you're an entrepreneur in the FinTech space, but could you tell us a bit about your journey of maybe different things you've been involved in that have taken you to where you are today?

Nicolas

I've done a few projects until now. I started from my family business with my dad as an accountant. When I joined after I finished my university studies in the UK, in the University of Manchester, we decided to try something different than accounting, by utilizing all the facilities and we entered into the corporate space. That was back in 99, so I had a bit of luck because that was the time that the internet started evolve, and as a young entrepreneur, I found this fascinating. So we started developing a few interesting corporate solutions. This eventually gave me visibility and attracted my interest in gaming. There was a lot of interest around gaming, so I decided to start my own business back in 2003. I ran for a few years box.com, but also retail and some gaming businesses that did quite well.

Later I decided to exit and diversify. I founded a company that was in the FinTech space. It was a brokerage company online. That was, again, run successfully until 2017. So it was about six years. Then I decided that I want to take the real estate more professionally, so I started investing in the real estate projects and operating them in Greece. And finally, I decided to start my new baby, my new love, which is called Moneygate. And basically, what I think is one common characteristic between my business is that I usually like to create a business than I like to operate myself. I like to bring value, and if timing and valuations arrive, I like to exit. Another characteristic is I believe a lot in focus, You need to focus if you really want to achieve. So, I'm always trying to deal actively with just one project. That's my short story.

Stephen

That actually is really interesting. I liked your phrase, 'my baby' when you talked about Moneygate. I mean, it's the passion in your voice. Share with us a bit about your passion. What is it that gets you out of bed in the morning each day?

Nicolas

Well, that's a very interesting question. Two things: my kids and family and my Moneygate. Now, always before I go to bed, I'm trying to think as little as possible enough to have a peaceful sleep, which doesn't always happen. But, otherwise, I just make a short note of tasks for next morning. So when I wake up in the morning, I refresh my memory with those tasks and I have my daily schedule with the priorities on who I should be calling, what should be done within the business, what we need to do with the team, and just schedule the day. 50% of the time, the day never finishes as planned but next day I started with the same way.

Stephen

It's good to hear. We often get our guests to share with us some kind of funny story or experience that they've had throughout their working life. You've had exposure to many different experiences. I wonder if you look back, you could share with us an experience that was either funny or a bizarre experience that you look back and had some learning from it.

Nicolas

I could say something funny, but there wasn't much to learn about it. And that was relatively recent with Moneygate. I mean, it's relevant in the sense that with Moneygate and with any digital bank, you know, you deal with clients and you always need to check who your clients are and you always need to be very, very careful in order to assess the correctness of all the documents, et cetera. But I remember that one of the first applications that we received randomly for Moneygate was from Elvis Presley. So, I mean, we found it funny here. I mean, we knew that it was not something genuine, but yeah, I thought that was funny.

Stephen

That's a great story. Thank you. Thank you. Okay, let's start thinking about Moneygate and understand a little bit more around some of the opportunities, but some of the challenges you're facing. We sometimes talk about this of what's in your inbox right now that may be causing challenges. Could you share with us some of those core challenges for you and your organization at the moment, particularly in the context of the current economic environment, right?

Nicolas

It's a fact that there is a strange economic environment right now. And there is a lot of discussion around fake tech companies and how this is affected. This is more relevant for companies where they are looking for valuations, multiples, et cetera. And, you know, it became tougher. Interest rates are high. So the investors have the expectations of higher tax. They want to see profitability rather than revenue. They want to see solid companies with technology. Moneygate is not at this stage yet. We are only one year into the market and we don't feel ready. Timing is not right for us to go out there and raise money. And we, you know, the company self-funded for the time being.

But regarding challenges for Moneygate, I think that it's very easy to see that there are many companies out there with a very similar business model, like the one of Moneygate. And we do recognize that this is not the challenge yet, but I am aware of that the way that we have developed this business, it would be a nice, successful business, nice to have, but it's very, very important for us to eventually know that the company is coming more stable in terms of the operations, in terms of technology, stability, et cetera, to eventually find niche markets or niche products so that we can penetrate specific markets, specific industries, specific companies. So, this is the biggest challenge that Moneygate would be facing in the next 6 to 12 months. We already started having some ideas. So, I feel confident that we will get to the end of it.

Stephen

Okay, and what would you say are the kind of core business capabilities you feel you need to give you that confidence?

Nicolas

I think it's all about identifying the demand of the specific product and being able to develop it technologically, of course, and being able to implement it. So, it's all about coming with the idea and bringing it to the markets.

Stephen

Okay. And as far as internal processes, and systems, and resources, and people, for example, how important is it for you to leverage those to help you achieve your goals?

Nicolas

Yeah, that's a very interesting question. I think what our biggest challenge in terms of internal procedures of human resources, it will be key to try and grow the company with as little additions as possible. We are a FinTech company, and as such, we hope and expect that the company will be run for systems with the support of people. And we don't want to become a company with too many employees, et cetera. Regarding handling this internally, it depends on the skills of your people. I do think that Moneygate today has a very good team. As regards to systems, and technology, and feedback, we are in a very good shape. Of course, it’s technology keeps evolving, keeps changing, but our systems are in place in order to be able to scale up and meet up those requirements as the market dictates.

Stephen

Okay. Do you have a head of product development or IT in your organization reporting to you?

Nicolas

Yes, of course. I have a small IT department and the head of IT reports directly to me. We have daily sessions of about an hour and a half to two hours every day. I think this is very helpful because it keeps me in the loop, but at the same time, I provide them with my feedback of what I see out there in the market. And this way we are synced between, you know, Founder, co-CEO, et cetera.

Stephen

And that relationship that you have with your product development or your IT team, I mean, specifically around your expectations and the KPIs that you would expect from them to show that they're doing what they should be doing for you. Could you share with us what they are in your mind?

Nicolas

Right now, everything is project-specific. Therefore, we are not selling software to others. So, we don't need to have all those KPIs in place. It's more like a deliverables. So, it's time and the end result. As I said, a lot of the systems are already in place. Some of them have been developed in-house, some we took off the shelf, some we asked others to develop. So, we are basically managing this equation. This is what our IT is.

Stephen

Okay. I think there are always two important variables: time and cost, and how we do that to best effect. I wondered if you could talk to us about how you came across iT outsourcing as a concept and maybe how your IT leadership team have used that or introduced it to you.

Nicolas

Yeah. So, especially in FinTech, with a business model of Moneygate, I find it's very costly and very risky if you decide to develop everything in-house, for example, the core banking software. You know, there's only a few big players there, and you see most of the banks using them and some other FinTech companies. It's obvious that those systems are too complex. They require many years of development and advancement. So, this product, we decided to, let's say, take off the shelve. Regarding outsourcing, it's always a challenge because, you know, it's always a debate as well if it makes sense to outsource or do everything in-house.

I think at the end of the day, it's not a question whether we should outsource, it's a question with who we should outsource. And, we did have some bad experiences as well, because you do face two problems with companies offering outsourcing. The main one is that sometimes they don't understand the product that you want to develop or you want to have. So they've seen or they've done something similar, but there is no good understanding. Eventually, once you decide to go live, you're going to have issues. And this is one of the issues. The second issue is that sometimes companies being eager to sidewalk clients and to sell more.

Go and see companies like Moneygate, create beautiful presentations, show you exactly what they would deliver, but then again it has to do with understanding of the product and they cannot value. So, this can be a bad decision to outsource. However, I do, I do believe in outsourcing and I think that everybody should be doing what they do best.We are not a software development company. And my angle is coming as an entrepreneur with the FinTech angle. So, I wanted as much ready product as possible in order to be able to distribute. But it's very, very important to make the right decision as to what to choose as a partner.

Stephen

Yeah, I would agree. I'd be interested in how you then internally work your kind of governance or frameworks to manage that relationship with your outsource partner so that we don't suffer from the risks that you've just explained.

Nicolas

Again, you know, when you outsource, you know, first of all, there is a contract in place. And this is again, very important that you took them to agree most of the terms contractually from the beginning even if this relationship will not eventually coming to marriage. So, sometimes it's even better to risk signing that contract instead of signing a bad contract because it will chase you for many months and maybe years, it will defocus you, and your legal team, and your tech team. On an ongoing basis, I think this is where the head of IT comes into place. It's very important, first of all, that the communication and the chemistry between the outsourcing company and your internal IT department is there. It's very important that it's good communications and chemistry, and that is probably monitoring, follow-up, even testings. And I think that if you achieve that, then you can end up with a good outcome.

Stephen

You've mentioned before you have experienced some challenges with outsourcing throughout your time. Obviously without sharing the name of the organization, but are you able to bring to life a particular experience where it didn't work well for you, an IT outsourcing model?

Nicolas

Yes, yes, sure. When we did start, we decided, you know, I was also rushing to bring something out in the markets. I thought that I'm going to have my license faster than I actually did. You know, license always takes a bit of time. So we decided to take a product for the frontend ащк the web banking off-the-shelf. Unfortunately, there wasn't enough attention or enough understanding of what we were expecting to... maybe they didn't understand what we are expecting to receive. Maybe it was also our fault, you know, I didn't want to throw that to other people.

But the matter of fact was that we went live with it and two weeks later we realized that it could not stay because once you go live, you start to see the real demands either with the user management or with frame interfaces, access levels, and so forth. And, we understood that couldn't take us far. And, we did take a dicision to disconnect. And, in parallel, we did a combination of two things: we developed one part ourselves, and then the second part, which was a mobile version of Moneygate, was developed by Devico.

Stephen

Okay. And we'll talk about your relationship with Devico shortly. I just wanted then to spin, we've heard where it hasn't worked for you, but could you talk us through an experience where at the end of that project you thought, 'Well, I'm glad we had an IT outsource partner for that project'?

Nicolas

And that's actually the case with Devico.

Stephen

Okay.

Nicolas

So, I went to them quite, I would say almost accidentally because I met one of the shareholders. And Oleg and I was, we were discussing about my challenges. And then I asked whether Devico would be interested to come and take this project for Moneygate. Oleg told me that he would want to understand a bit more. So we prepared exactly what we were thinking to do, and we also presented him a few features in our web bank. And, I have to say that from the first call that we had with their team, it felt like that department belonged to Moneygate. It was funny because I did the call on a Friday, and on Saturday I flew to go on a holiday for a week with my family. So I thought that I'm gonna rest for a week but already on Thursday one of the members of Devico, the guy who was responsible for the UI UX, was asking for a Zoom call because he was ready to present me with the first images.

I was very excited, of course, to jump on the call, and that was a start of a very beautiful relationship. The product was developed within the deadlines that we agreed orally first and in writing afterwards. So, first of all, on a perfect time, we went on testing – we found zero issues. Usually, you know, it takes a month maybe two identifying different bugs. And, the most important is the feedback that we get out from our client because irrespective what I would feel, if once it hits the market, it doesn't cover good feedback, then your product is not up to standards. But we get very good feedback. It's a product that now we can develop and scale upon. So, I think for Moneygate, for us, I think the example of Devico as a decision to outsource was a tick in the box.

Stephen

Okay, thank you. Here's a question. As a summary, could you give me three words then that would describe to me the benefits of working with Devico for you?

Nicolas

I would say consistency, reliability, and understanding the product.

Stephen

Okay. Thank you. And they're useful words for anybody to measure any IT outsource or relationship with in the future, I guess. One last question. There're lots of people here will be listening and wondering how they enter into a relationship with an IT outsourcer. If there was individuals here, CTOs, CEOs who are about to consider doing that, what advice would you give them?

Nicolas

First, I would say, do what you do best and let others do what they do best for you. It'll be faster and cheaper. But I think the most important is to probably assess the abilities and capabilities of the outsourcing company, of the resources they have and are committing to dedicate, and of course, costs. Costing is always the edge of evidence.

Stephen

Well, Nicolas Treppides from Moneygate. Thank you very much for a really interesting conversation and sharing your thoughts with us.

Nicolas

Thank you. Thank you for having me.

Stephen

Thank you.