Podcast April 29, 2021

How COVID accelerated the Fintech boom

Necessity is the mother of invention. 

We’ve all heard it, but the past year has proven it — we are finding new ways to work, to socialize, to educate, to shop and to pay.

And when it comes to Fintech, crisis is the mother of innovation.

In this episode, Cara speaks with Brady Harris, CEO, and Adam Steenhard, Senior Director of Corporate Strategy, at Dwolla, about how they are helping to revolutionize the payments space and why the pandemic is a boon for Fintech more broadly.

They discuss:

  • Why payments has grown since the advent of COVID
  • The importance of simple integration in Fintech
  • Why partners are more valuable now than ever before

Why the payments space is growing

At the outset of the pandemic, fear and uncertainty abounded. But it wasn’t just the virus — it was everything that came with it.

And financial uncertainty topped the list.

As companies scrambled to find new ways to adapt to the pressures of social distancing and remote work, one thing became abundantly clear: 

Flexibility was life or death.

Payments has grown in pretty compelling ways since the crisis began.” — Brady Harris

Organizations had to rapidly shift overnight and build capacity for remote work, virtual meetings, Zoom, Slack — the list goes on.

And with the need for flexibility in work came a growing awareness of the need for flexibility in payments. 

Consumer behavior has also shifted. When brick-and-mortar legacy institutions shuttered, consumers became increasingly more apt to seek out alternatives in everything from groceries to finance. 

Dwolla is one such alternative. Its design as a readily scalable, API-driven payments company covering traditional finance needs as well as instant and real-time payments, with a focus on ACH, is exactly the simple solution needed in this climate.

It’s no longer an 8 to 5 world — and payments need to adapt to the new normal.

That’s why Fintech’s massive boom has only accelerated in response.

Why simplicity is the biggest consideration

Low and no-code solutions have become a bit of a buzzword. 

But, just like digital transformation, the pandemic has proven them to be important buzzwords when handled right. 

That’s why Dwolla has made a concerted effort to make its product as simple as can be for its customers — especially when it comes to integration. 

“The simplicity associated with integrating with your product has become — if not the leading consideration — one of the biggest considerations.” — Brady Harris

This too was accelerated by the demands of the pandemic. 

The pandemic demonstrated to the company that not all of its customers had the technical expertise or the developers needed to integrate with a more complex financial API. This led to longer times between integration and the value customers would be awarded when they began transacting.

So, they set to work in making the buzzwords into something with real-world value. This is something that they track, called, unsurprisingly, time-to-value. 

And the company’s efforts to simplify this process had impressive results: Dwolla’s time-to-value average went from 155 days to under 40, with many companies reaching that point within 10 days. 

They did this all by reconfiguring their product for simplicity. 

And in tech, that’s a superpower.

Turning competitors into partners

Dwolla’s superpower led the company to better be able to serve its customers, but they realized — just like superpowered comic book characters — they could better help the public with sidekicks. 

More specifically: partners. 

“We continue to embrace partners as part of our journey, rather than the competitors they were at the beginning.” — Adam Steenhard

While Fintech is booming because people are more amenable to innovation out of necessity, there are many companies out there that serve these needs and do it well. 

And rather than trying to be the best at every financial service out there, Dwolla (and many others) believe customers could be better served by partnering with the best. 

In fact, they are currently looking to form alliances with upwards of 20 former competitors. 

There is a lesson here:

Fintechs being siloed from each other is a problem we need to overcome. It helps neither your customer nor your company. Strategically speaking, you can do more for your customers and yourself by forming partnerships.

But an even more important consideration: There is a huge ecosystem out there and room to play together and create cool products within it. 

The Fintech march will carry on unabated regardless, but forming the right partnerships will help you always be at the head of the pack.

To ensure that you never miss an episode of Payments Innovation, subscribe on Apple Podcasts, Spotify, or here and don’t forget to check out our YouTube!

Until next time!

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