Fintech is one of the fastest growing technology sectors in the world. It’s a sector buzzing with a diverse range of startups, all fuelling rapid disruption and capturing market share from older, more established financial businesses. As investment in fintech startups rises, more companies are joining the race to conquer new product areas, widen their customer base and target international growth.
At the same time, the rapid-fire pace of the industry has seen fintech investments hit $91.5 billion in 2021, nearly double the year before, forcing companies to confront challenging new business scenarios and competition as they grow their fintechs. Alongside more traditional endeavours like improving profitability and minimising costs, this means they must also be ready to comply with stiff industry regulations, have the capability to scale on a global stage and improve transparency for their investors.
In this blog, we explore how to grow fintechs by investing in a unified, cloud-based ERP solution that enables you to tackle the unique challenges of the sector and ensure that you’re equipped to attract investment, scale up rapidly and meet your high-growth business goals.
Global business management with a cloud ERP
Australia has seen the fintech sector grow from a $250 million industry in 2015 to a $4 billion industry in 2021. For any fintech that has established itself in Australia, overseas expansion is the obvious next step to scale up and achieve growth for your business. But before this can happen, it is crucial to have the systems in place that allow seamless operations across international markets.
To help smooth the expansion path, startups need to upgrade their systems, which is most easily achieved through the implementation of a modern, agile cloud-based ERP and financial platform that provides a single source of truth across the entirety of operations. This allows fintech startups to lower the cost of entering new markets, scale easily, bridge communication barriers with a multi-language user interface, and use multiple currencies. And with a platform such as NetSuite’s OneWorld, adding new subsidiaries won’t require the deployment of new systems or investment in consolidation tools either. In many cases, it is as simple as a few clicks.
Automation and control
Regulatory compliance is another key challenge to fintech growth and expansion. Without access to the same resources available to larger financial institutions, many fintech startups use manual processes to adhere to compliance. But at scale, these processes quickly become untenable. NetSuite OneWorld helps simplify regulatory compliance by replacing complex manual processes with automation to streamline financial processes and ensure robust controls are always in place.
Lowering TCO with a unified system
While fintech companies are market disrupters driving agility and superior service to consumers through digital-first and cloud-based models, their own back-offices – particularly during the early stages - often use entry-level software systems such as QuickBooks or Excel spreadsheets. However, these solutions are not built to scale. This leads to finance teams purchasing multiple smaller accounting packages in an effort to handle multi-entity operations which, in turn, leads to manual-intensive attempts at consolidating processes and other avoidable inefficiencies.
Switching to a unified cloud platform like NetSuite provides a single database no matter how many entities are added, which helps reduce the total cost of ownership and provides associated benefits such as automatic updates managed through a multi-tenanted ‘true cloud’ model. Plus, it gives you the ability to add functionality as needed.
Modernised reporting, budgeting and insight
Investors aren’t solely interested in backing a company with exceptional service or a product backed by a slick pitch deck; they will also look favourably on a solid IT infrastructure that is modern, agile and equipped to scale globally as the business expands. With an integrated ERP that generates a single, real-time view of the company’s data, your company will be able to meet compliance and reporting requirements while accurately budgeting and forecasting for future growth. This will allow you to stand up to the heavy scrutiny of any potential investors.
Agile deployment models
One key advantage fintech companies have is agility. To support this, your chosen ERP should offer a risk-proof implementation process designed to significantly reduce time to value for growing fintechs. NetSuite’s SuiteSuccess is a unique engagement methodology based on financial and accounting best practices that includes pre-built reports, dashboards, KPIs, detailed workflows and preconfigured roles, delivering rapid and ready-to-use functionalities to startups.
The final case for cloud ERP
Start-ups need a robust cloud ERP in order to scale andgrow. Fintech startups operate in a sector that is in a constant flux of technological changes and disruptions, and cloud ERP solutions are some of the most important building blocks, particularly given the focus on fast-paced growth, service digitalisation and increasing investor confidence. NetSuite has become a trusted choice for growing fintechs, enabling them to focus on efficiencies and effectively manage their scaling ambitions.
Making an investment before growing pains set in will empower your fintech to engage in funding rounds confidently, knowing that you are ready to deal with increased demand for business transparency and to handle growth without the need to expand back-office costs at the same rate.
The ability to automate processes, expand into new markets, enhance customer relationships and improve visibility all hinge on having a business system that can help you level up your operations. Register for our webinar ‘Cloud ERP for Fintech: Preparing for post-funding growth and scale’ to learn how to leverage modern business systems to grow your fintech company.
Annexa is aleading NetSuite partnerwith extensive experience designing and implementing comprehensive and customised business systems, includingpayroll solutions,financial management, warehouse managementandecommerce solutions.