Switzerland

The big bucks are with business, not with IT

November 10, 2020

What are the main pitfalls when trying to start collaborating with banks? What should be considered when targeting incumbents? How can startups contact potential customers or business partners? F10 senior advisor and banking expert Marc Lussy provided the entrepreneurs in the F10 ecosystem with tips on how to approach banks in Switzerland.

Collaboration has become more important than ever before as agile startups addressing the needs of the clients of tomorrow are entering markets that had been the exclusive realm of traditional banks, insurance companies, and financial institutions for decades. This means that incumbents must figure out how they can reinvent their products and create completely new offers to address consumer needs quickly. Switching providers can often be done with one mouse click and only companies that focus on customer experience will survive in the long run.

During an online session for the entrepreneurs in the F10 ecosystem, F10 senior advisor and banking expert Marc Lussy provided the startups with tips on how to approach big banks to start meaningful collaboration.

Marc has more than 20 years of experience in banking and has worked as a trader and in wealth management. He became an independent advisor on digitization eight years ago, has been a partner at the WealthTech company IBO for five years and a senior advisor and mentor at F10 for four years. Marc describes himself as “FinTech aficionado from day one”. He has recognized the value of collaboration between traditional banks and innovative startups.

Where to start

As a first step when looking to collaborate with Swiss banks, Marc recommends entrepreneurs to conduct thorough research on the banking landscape in Switzerland and its members.

“Get to know the Swiss banking ecosystem to target banks who might benefit from your solution exclusively. Make sure their offer matches your product or service.”

Is your solution addressing the challenges that the banking sector is currently facing? Does it have the potential to improve customer experience? How can your startup help the bank increase its market share in the long run?

“As a rule of thumb, big banks tend to be most interested in RegTech; medium-sized banks and private banks in WealthTech and retail banks should be approached with solutions in the payment or credit sector. For core banking solutions, you might consider working with Avaloq, Finova, Temenos, or Olympic”, Marc explains.

“You need to solve the puzzle and explain how your solution helps the bank or financial institution to innovate and stay competitive.”

According to the former banker, solutions that enable cost savings are usually the easiest to sell to big banks. He recommends also looking into partnerships with associations and open banking platforms such as Swisscom or Inventx.

When is the best moment to contact banks for collaborations?

“Budgets are often tight by the end of the fiscal year and you should not approach banks in autumn”, Marc says. Be aware of the threat of information drain during interactions with potential customers or partners: “The typical banker is not an entrepreneur. Some will just want first-hand updates on new ventures and solutions for their personal benefit”, the banking expert warns. “Therefore, you should not only deliver information when meeting up with bankers but try to get insights into people and processes.” Never leave meetings without having received at least one piece of information that is valuable for your startup.

Try to find out who is responsible for proof of concept and technology partnerships at the bank or department.

“Contact people with decision-making power. The big bucks are usually with business, not with IT.” In times of social distancing and with most industry events or pitching contests cancelled, decision-makers at banks are flooded with even more emails and pitch decks than before the outbreak of the pandemic. Marc recommends to “create an ice-breaker that makes your startup stand out of the crowd.” This can be achieved by referring to the latest public speech or interview of the top manager you are addressing, asking smart questions, or paying honest compliments in the opening sentences of your email. Marc recalls how he was able to get the attention of the CEO of one of the biggest Swiss banks: “In my first email to him, I confessed that I had long been sceptical of his strategy and was now positively surprised by the latest decisions and success.” Nevertheless, the banking and collaboration expert emphasizes that this provocative approach might not always work – depending on the personality and mood of the person you are contacting, on your messaging and on the way your startup presents itself in public. Authenticity is key when communicating with your target audience: stay true to yourself!

F10 believes that the fastest route to innovation lies in early collaboration between startups, incumbents, and investors. Dedicated mentors such as Marc Lussy share their industry insights and experience with the startups in our programs.

Are you ready to enhance your network and join the global F10 ecosystem? We are now scouting for the best FinTech, RegTech, InsurTech andDeepTech startups for the F10 Incubation Program in Switzerland, Singapore, and Spain. Teams accepted into the program will receive individual coaching on go-to market, product development, and fundraising, have the opportunity to connect with the F10 investor network, gain access to test data from major banks as well as insurance companies and benefit from free office space in the heart of Zurich, Singapore, or Barcelona for the duration of the program.

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