Podcast January 25, 2022

Why Banking as a Service Isn’t Right For Everyone

Banking as a service has been a hot topic for a while, but just because it’s popular doesn’t mean it’s the right path for everyone.

A brand needs to consider its DNA and where they can bring the most value to the customer.

Just ask Yuval Brisker, Co-Founder, CEO & President at Alviere, who explains how they’ve differentiated themselves by being hyper selective of their customers.

Join us as we discuss:

  • Yuval’s background and what Alviere does
  • Shying away from the hot topic of banking as a service
  • Targeting particular customers to differentiate from other platforms

Want to find out if banking as a service is right for you? Let’s explore more.

”The real cathedrals of today are being built in technology, not in architecture.” — Yuval Brisker

How we got here

Yuval says he’s a serial entrepreneur.

After starting his career as an architect, Yuval realized that today’s cathedrals are being built in technology, not architecture. Soon after, he found himself working in software development. Today, Yuval has spent 20 years in the tech industry.

He can’t write a line of code, but he has amazing partners, collaborators, colleagues, and employees who bring ideas to life.

In 2003, Yuval launched his first software company, an early SaaS enterprise focused on field service management The key premise behind it was to build software that could predict when a technician would actually arrive at a customer’s home — thus avoiding that four-hour window where people have to wait and watch.

The project caught fire on a global scale, and eventually, Oracle acquired the product.

This experience proved to be good training for a payments innovation project. What if, Yuval wondered, you could build a payment app that could focus on privacy?

What people don’t care about

Everyone says privacy is important, right? Turns out that’s not the case.

People didn’t download Yuval’s app.

That experience taught Yuval how complicated the financial services industry can be — regulators, banks, processors, fraud risks, and all the other components that make up the financial services ecosystem.

Soon, however, the project hit a wall.

The truth is, people, like to talk about privacy. They don’t actually like to be bothered with it.

Yuval needed to try something else.

“Embedded finance at this point, two years in, has become quite broad.” — Yuval Brisker

Banking as a service

Banking as a service is a broad concept that includes many different components.

Yuval doesn’t believe many of the other companies in the industry represent competition. They’re not doing the same thing he’s doing. It’s all so different.

“I think it’s important for us to clearly differentiate and define what it is that we’re offering in the market that’s different,” Yuval says.

He also fears commoditization in everything. The minute somebody says, ‘You’re a commodity,’ you’re a commodity — and you don’t want to go there.

Be specific about who you are and what you do.

In Yuval’s case, “specific” was also “huge,” “nascent,” and “relatively early.”

According to him, that gives us a lot of opportunities to own a term.

“You could only be the best if you clearly find out who your best customers are.”  — Yuval Brisker

Finding your sweet spot

Two years into the project, Yuval says embedded finance has become quite broad. From a market positioning targeting point of view, you have purely technological embedded finance companies. On the other hand, you have large-scale, enterprise-focused embedded finance solutions and platforms like Alviere.

Is there a difference?

Yuval says there is. “We’re focused on something that is in our core wheelhouse and in our DNA as a company and as a team,” Yuval says.

You bring your own DNA to the table. It’s not just technology. It’s about the customer. You need to figure out who’s the best customer for you.

Defining your brand DNA

By defining what’s best for you, you’re defining how you can bring the most value to other people. That’s key.

Yuval’s company is enterprise-focused, not zoomed in on everyday consumers. Alviere’s embedded finance solution is probably not for the startup Fintech, therefore the company may need a solution, but it’s not in Alviere’s DNA to provide it.

Alviere works best when it works with large companies.

Providing more than just a financial service

There’s a difference between banking as a service and this whole embedded finance play.

You’re not going into companies whose main line of business is something totally different. You have to provide a service.

Beyond the technology, you need to think about all the different aspects that go into it.

Where Alviere is going next

When Yuval talks about the future, two key points stand out:

  1. Success is never a given
  2. People are everything

Success springs from hard work, lots of thinking, premeditated activity, grit, and perseverance. Never giving up is key.

People are everything — customers, team members, everyone.

Banks, however, never seemed to really like people.

Thus, the vision for embedded finance is to bring customer relationships to people who actually know how to deal with customers. And that’s really exciting.

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