We sat down with Marc Baumgartner, CEO, Pangea, at FinTECHTalents 2019, where he talks about how to use market intelligence and Pangea resources to grow, scale and break into new markets.
Watch the video now:
How does Pangea support the ‘Go to Market’ strategy for FinTechs?
For us, there’s two things. There’s a strategy then there’s the execution. On the strategy side, I think that’s pretty straight forward for most companies. Most FinTech companies know their strategy, they know their target market, they know the target audience, they know who to go into – getting in is the challenge.
So the big issue there is access, right? How do you get access? People do very well with access from their core markets. What we see is, in their core markets, their core country or their ecosystem, they scale from zero to X reasonably fast and recently well.
Pangea comes in when you want to scale past that. What we do is we basically draft behind that. Companies that have product, market fit – we draft behind that and let them scale globally. We have offices and entities all over the world and we take our ecosystem and draft into that.
You’re a European FinTech and you want to scale into the US – we’ve got multiple people, partnerships…to tech partners etc…. The reason for that is going direct is very, very difficult, because you don’t know who, you don’t know how and you don’t know the mechanism to do that and you don’t have enough time to get it wrong. Pangea is a mechanism basically circumvent that and go direct and do it with a partner behind.
Because you already have the expertise there, are the sales and marketing easy?
The ethos is a very difficult thing to do. In concept it is very easy but in practice it’s very difficult. It’s a very difficult thing to do to scale a business. Our perspective is anything you can do to de-risk that exercise is hugely valuable. We de-risk it because we have the multiple channels that support it.
Then our clients take our people in a house. It’s a Build/Operate/Transfer model. Once we do that you can de-risk the front end, scale and get people from 0 to X. Then take it in-house and live happily ever after. It’s not that people aren’t good at sales; it is very hard to crack a market.
If there’s any expertise in cracking new markets, new verticals, to support behind that it’s great. In the world exists, between tens of thousands of people, to give you a perspective on it or strategy on it, a playbook etc… Pangea’s view is that it’s helpful but not truly helpful. You need people who can actually do the execution, that have the partnerships, that have the relationships with banks, that have the sort of relationships the people you want to bring in-house and work with you. That’s our perspective.
How do FinTech companies work together via your platform?
We have very specific lanes around the sort of areas that we work. Unlike every consulting company – so McKinsey works with JPMorgan and Goldmans, so putting sort of IP barriers there has been no problems been solved for a long time so we’re very thoughtful around that into theory. But what we do is we, basically, put a draft behind all the people saying: ‘okay in payments we work with these companies, but in core banking we work with these companies. You guys, there’s a natural correlation, AML and KYC these companies, there’s a natural draft between all of those companies’. It gives us a perspective.
Because one of the hardest things to do is, not only do you know where to go, but in a specific account, let’s say it’s HSBC. Who exactly at HSBC has the budgets? What’s the history of: Does this pilot program pay off or do they do 40 of those and execute on two? Pangea has a view on that, because we’ve got 10 companies in any given day working with HSBC. We have a very specific, very real perspective on how to sell the HSBC, who to sell to, who the coaches are, who the sponsors are and how to actually break that account.
That there is a huge value for our partners. We let people work with us saying: ‘if you want that information, we have that. If you don’t then we’re just a channel for you to go direct. Either way we’ve got a ton of IP that sits in Pangea, in terms of what’s actually live in the market, who’s making decisions, how they make decisions, why they make decisions etc… We’ve got a fair amount of perspective on that.