Colin Kennedy's Thoughts on Fintech Now & Moving Forward


If you take a look at any major investment publication, you’ll see that 2020 was a great Fintech fundraising year. Despite the pandemic, the VC community is excited for all of the new innovation in this space.

Colin Kennedy, who just joined Ramp as Chief Business Officer, stops by in this episode to discuss how this accelerated momentum in Fintech has changed the space and whether it is here to stay moving forward.

Some topics we discuss:

-What direction is FinTech heading in the near future?

-Accelerated trends in Fintech due to the pandemic

-CFO and Head of Finance engagement with FinTech

-Fintech consolidation and breadth of new product offerings

This discussion with Colin Kennedy was taken from our show Startup Success. If you want to hear more episodes like this one, check us out on Apple Podcasts.

If you don’t use Apple Podcasts, you can find every episode here.

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Welcome to start up success, thepodcast for startup founders and investors here you'll find stories ofsuccess from others in the trenches as they work to scale some of the fastestgrowing startups in the world stories that will help you in your own journeystart up. Success starts now welcome to start up success to daySteve Lord head of Berkly Pin Tech Practice is here with Colin Kennedy,who is the chief business officer of ramp. He just joined from Stripe, and Iknow this is going to be a terrific conversation, so welcome to you bothand Steve. I'm going to hand it over to you all right, great thanks, Kate andYow Jane calling thanks for being here. This is super exciting for us to havefolks of your caliber and your position in the FINTAC industry, so welcome andthanks for joining us. It is great to be here. Thank you for having USlooking forward to the discussion awesome. You know we don't always havefolks calling with your breath of or your span of observation across thewhole industry having been sort of on the banking side and on the operatorside and on the big corporate side, all the way down to the start up side. So Iwas just wondering like when you look across those different vantage points.Are there any you know? Are there two or three key things that that sort ofleapt out of you let out to you about ramp and about what they're? Buildingas it relates to where you think fin tech is heading and obviously AndreChina in to please yeah? Absolutely I mean there. There were many things thatleft out, so I say first and foremost cannot emphasize enough the critical tyof the founding team and the early founding team, and that the importanceof that so I had the men benefit and privilege of working for strike for acouple of years and getting to see just a world class founding in seniorleadership, team and there's a lot. That's somewhat familiar at ramp andvery specifically, F is engineering products and users. Customers, firstand as much as that, cliche is thrown...

...out there and all confess I don't oftentrust it. When I hear it, unless I see it's put into action to see the extentto which that's in the DNA of the company- and I say from knowing bothcream and ARICA CO founders for about seven years now, seeing how they didthat with their last company Parabas and really looking very directly atfeedback a lot of our investors- God as they were diligent, diligis us andseeing what are our customers saying about ramp? And it's very much comesback to themes around the extent to which were really focusing on whatmatters to the most and continue to iterate. So T that was one area I thinkother ones that that came out are really. Secondly, a focus on long termvalue and long term relationships we're in a really fortunate space and that weare able to deliver to users to our customers, really immediate savings,immediate benefits that they do value. It's a privilege that to do that, it'salso great to have this infrastructure in place from this engineering team. Atthat we have at ramp that lets us broaden our offerings and offer it moreand more to customers over time. So those those two things are probably tolike. I longer horizon right to be able to earn the right to show where givingyou immediate benefit. As we promised you have you see that you feel thatbeoples see that we're developing more really quickly. I mean there's no othercompany out there that I have seen that has brought so much in terms of futureand functionality sets and benefits to users so quickly and also companies ofa lot of different sizes. I give the team a lot of credit, and it just givessome credibility with customers who see yes, whether it's a one passwordintegration that we announced a few weeks ago, whether it is the abilityfor us to have the cards use internationally, whether it's theability to initially virtually provision a card, an additional havinga physical card. Those types of things are: are things a lot of companies arenot offering and that our users definitely appreciate, and it's kind offun to be able to provide great thanks when you look at Fintac in general andobviously ramp. I is part of this. You know we hear a lot about how we'regoing to disrupt the legacy. Guys right-...

...and I know for her- ended up doing avery good job of doing that, but I mean, if I had a dollar for every fin, TexCEO, that told me he was going to Dis Intermediate Master Card. You know, doyou see, I mean, obviously you do for ramp, but do you see the fin tech worldkind of moving in a direction where it could be a little more aspirationalthan it is going to end up being able to fulfil? I mean I guess it's a longway of saying: Do you find the fin tech industry and all of the focus and allof the V C capital providing? You know the triumph of hope over experience alittle bit there yeah, I think the biggest mistake, and, what's always ared flag for me, is when companies, especially companies like us, areeither talking about valuation or talking about Discernin mediation ortalk about something else. That, I think, is much more of a trophy and adistraction. If the focus is really not on, are you building something thatcompanies are using right now in a meaningful way? Do you see a high uptick? An use? You see your growth rates really strong in terms of O, how you'regrowing in the segment do you have really strong n PS scores if you're,focusing especially at our stage on things other than that, I think it's amassive distraction. disinterred ation in different cases certainly happensand we can talk academically around we where it occurs, but the core missionof the company has to be about what steps can we take? What can we do toadd more value to users and that in many cases for ramp, it involves a verypartner, centric approach, so I'd say our model is in part of why I cametethers a lot. Certainly, an immense amount of the team has built internalline, and we've talked a little bit about the savings controls around theability to have these controls are pretty finite levels, analysis andtrends that that C fos at companies of hundreds of people and thousands ofpeople who use ramp really benefit from it and love. It's great to see all thatand to deliver that it's also a stand stage where we can do that in somecases through using partners. So I...

...reference one password before, which isa country that we respect. We've done a partnership with then integration isjust about reducing correction. There are a lot more partnerships. That, oris it part about reducing friction, there's a lot more partnerships that wecan do with others, and it's one of the best things about being in Fantec rightnow is that if you are really able to focus on growing the overall pie foryou and your customers, you're going to have a much better neger term and longterm relationship versus thinking, you need to try to take somebody out of theecosystem. Yeah Yeah, I think a lot of times. They say that when they'retrying to raise money and then they get it and they realize, Oh God now I gotto build it. You know and to your point, if you just stick, stick to yourknitting, build a thing that people like and give them more value than theythink you're paying for they're going to they're going to build the businessfor you in a way right, and there are some great porters out there too, likeon the on, if I think of different banks that that we work with and manother ones, we may work with in the future. We're not a bank, and we don'thave a plan right now to become a bank that makes us dependent upon incrediblyvaluable banking partners. They give a great service and figure out how tomore effectively partner with them. So if you're, a customer of Rams and bankacts you're getting a better experience, ideally yeah and that's, I think,that's the key. The founding team focusing on the experience right andnot focusing on the accent or the valuation or you know a lot of theearly crypto guys were all talking about how they were going to put. Youknow, enter fortune five hundred companies name here and put him out ofbusiness. Well, maybe not so much right. I'd like to tread it a little bit to us.If we could on so we're watching fin tech row. I think I think it was eitheron one of the data. CEBINE are one of those guys that track the SC industry,I think, has come out said two thousand and twenty was the best Fintac Fundraising year. In spite of the pandemic, there was a ton of V C interest in it'sin the space, some great accents, O Unicorns, and all that when I look backand I'm curious what you think about, I was going to say this premise and I'dlove you to guys to tell me what you think about this idea. It seems likefin tech sort of started out with the idea that we were going to cleave offpieces of traditional business banking.

You know debt management settlement andclearing all of these things and run them using modern technology moreefficiently, cheaper, faster and all that, and so that created this sort ofdisport f. all of these different FINTAC use cases and companies, and allthat and now it seems that there may be a trend over the next couple of yearsto bring all of that kind of back together again that there's almost atrend, beginning of consolidation, where some of these larger firms nowwant to go bolt on those fin techs that have become very good at doing a thingthat the bank, maybe is realizing they're, not so good. At doing so. Iwould love to hear your thoughts on that. It's a it's a work in progress onour end, it's just a theory but curious what you think of that idea. Yeah! It'sa good idea and I'll give the listeners the benefit of hearing less in my voiceand a mined and Andrew Ask askin to jump in and share thoughts aboutsharing initial thoughts. So I think in general it almost gets back to what youare raising. The last question, which is the model itself really will be thatmuch better if you're focused again and what's the value you're bringing tousers your bringing it to customers, I think, what's gone, played largely is,and it's central to what we're doing here at random is realizing, wherewe're going to focus where we can add value which we see is both to employeesto the entire finance function within a company in terms of controls in termsof demonstrable savings, a fundamentally different model whereit's, the first car of the first spend management product focused on savings,were suspending. Those are our easy things to talk about from a marketingperspective, but they're hard to engineer, and they can be hard forcompanies to live by because I haven't seen any other company do it. The focusfor us is thing we can have, because we have a fantastic engineering teambecause we actually are focused on these values and because I mean ramp isa collection of people who have worked for ten tax work for startups workedfor SASS businesses worked for a large financial institutions, there's arespect for all. All of that knowledge...

...that we have as a company, the head ofour risk group was at Goldman sack until six months ago I had worked withit with him till around six months ago. I'd worked with him there. He is he'sone of the best people of no the best person. I've worked with in thatcategory that category of risk management is not something an end userthou think about directly, but when we do it well we're able to deliver thatmuch more value to them. So we really look to find who are the best peopleinternally, that in the ecosystem that we can work with and then how to usedifferent partners along the way just as they're using us there are us notbecoming a bank, as an example is a very deliberate deliberate decision.It's not something we're pursuing right now, nor is it something we have plansdue to two percer pursue, at least in the near term. That's because we seeour team being able to leverage the engineering assets, the technology wecreated in a way that users appreciate a lot much a lot more. If we continueto build out the savings controls, if we continue to build out likely other rails that they can use tomanage to manage other aspects of their payments, if we really can optimizethis experience of corporate spen managements, a lot of us haven't liked.If we can focus there and partner effectively with banks, we think it's abetter experience for users. Andre Talks about with a lot of our partners,regular with a lot of our our users regulation, would love his thoughts onthis yeah yeah. Happy to trim in here I would say that for us at least for myperspective, I look less at at it about consolidation and what is the bestexperience for our customer, so whether that's partnering with someone orconsidering some sort of emaciate, whatever the best product and climentexperience, would be for our customers. I think that's how we look at it andthen get less caught up in broader. You know what the industry is thinkingabout, it's more so, let's deliver the best possible experience or for ourcustomers, and how do you think the legacy incumbent, people that are doingwhat you guys do are thinking of that...

...ecosystem? Do you think, they'rebeginning to understand that consolidating some of this stuff, allunder one roof, is I mean, like stripe, got into a couple of different placesof square started, a bank? I think right square payments. They all startto widen the tent a little bit and get that user like well. Hey, look, we'vegot you know, we've got their payments. Well, maybe we should get there orwe've got their banking. We should get their security straining. They do startlooking a little of field, I'm just curious what you guys think the legacythinks we're going to do. Yeah. I think it varies. A lot company to company, soworking at Stripe is one of the biggest privileges of my career, and it'sreally because no other company have, I seen, reallylive and exhibit the values of focusing on what matters most of customers and acompan that also started revolutionizing and simplifying thepayments experience and the time when it was extremely painful and spent alot of time and continue to put out a lot of new futures to really optimizethat core payments experience they've been extremely thoughtful and extremelyuse, er focus and how they have expanded. I think others others havenot. I think others have taken an approach similar to to what you're,alluding to in terms of perhaps looking more academically a category that cancapture versus the categories that users customers actually want them totale care to yeah. It gets back to almost your last question of theconsolidation of the trends of the industry. Maybe last year was by thedata great year for Fintac in terms of valuations the thing we're reallytrying to push ourselves for as like what does that mean for the people whoare using FANTEC solutions? If you are a medium sized business, a smallbusiness, a large corporation? How was your life better now a year later fromall of this funding, so the onus is on us to translate that investment intosignificant action. tenters. Other interesting question I have for youguys is so so the pandemic is obviously been a forcing function all across theboard right, but obviously in fin tech payments in a couple other places, itis accelerated trends that were already there as it relates specifically towhat you guys are doing individually,...

...but then also wider into the ecosystem.I just like to chat about that for a second. First of all, do you agree withthat premise and we're particularly within FANTEC? Do you think thegreatest acceleration has happened? Sure hundred you want to you want tokick us off. I asked because I know you've seen a lot of this, so I dew'sbeen a ramp par. A lot of people ask you guys is yeah. No, it's a great!It's a well some habits. It's a great question. It's always fun to w toreflect on it. I happen to had I added some thoughts Andrey when you want tokick us off yeah yeah, so I think there's been a lot going on in fin tech,we're seeing, I would say from our end, obviously our focuses on corporate cardand spend management. However, I would to across the board the industry is hot.We're seeing all players in the states are growing very rapidly and we'relooking at. You know: Partnership Opportunities with others, where wethink we can have a better and value ad for the customer right. So if it'sworking with someone, that's tangential to us in some way right, they'regrowing rapidly, they have a great experience, greatproduct great. We wanta partner with them work with them and that's kind of how we look at it rightit's. What is going to be the best experience for the product and whichFintac are doing that and will evaluate those those those partners? And it'slike just to pick you back on that really. There are two two things thatkind of come up. One is there's clearly been, and this was was surely notnecessarily expected, but an increased focused on bottom line savings so fromramp, whose core mission is around demonstrating that savings so to launcha corporate, spend and expense mangin solution and say our mission is reallyto help you save money, that's anithetically to how everybody else.NECO system for decades has approach the space. It's happened at a time whencompanies are appreciating that more and more in what we've seen thefeedback from users is tremendous and saying great. We can actually seedemonstrable savings in these categories and he's incited in a yearwhen that was really important, right people care to the ear more last yearthan ever completely, and it certainly manylearnings along the way I mean the the...

...common place to go to is clearly lessspend on traveling expenses and we're launching a corporate card solutionwhich is traditionally associated with travel in expenses yeah the growth theusage has been tremendous because for us, it's not about coming in and sayingwe're looking to fit into that mold of traveling expense management, it's muchmore, so the broader ecosystem, where companies are spending and what'seasiest for them, so a lot of spen on advertising and other sources. Inaddition to saying an increase in spend recently on travel, an expense which isthe high school we Mahault Fuck. is we really want to help pull companiesthere? We love that, but it's also been an outgrowth to your question of or thefocus on, digital and other spin is also been an outgrowth of what we'veall experienced last twelve months. Have you guys seen the way of CFengages with the product change with the pandemic, with everybody, a e? Doesthat matter? Does it make it easier harder like what's the where's thatyeah come down, so it's would love to get to get tons from other others. Onthis too, I think one thing that's been interesting is we're clearly trackingwere to company. Where do companies go in O R, our products weet? Whatfeatures are used the most, and we saw not necessarily surprisingly, but justa wonderful adoption of C fo's heads of finance looking at the insights weregiving on how their company and their employees are spending and reallyfinding value in the insight, it's incredibly easy to talk about savingsinsights, but very hard to present them in a way where you consistently see afinance had at a medium size, business who's, managing a million things tryingto grow their business. Use these to make different decisions. I don't it'shard to have the causal link, but there was an increase during the pandemic interms of increased focus on what do you thinking with my sit right? We've seenthat to on our end that the the the demand for accurate pis around a wholebunch of stuff it was there before but being able to get to them quickly,accurately and comprehensively, and the pandemic certainly took on a greaterfocus. Thank you both again for coming.

This has been super insightful and andhelpful, and valuable and Katal turn it back to you. Yes, thank you both and thank you Stevefor hosting Andre. Do you want to leave listeners and where they can get intouch with ramp if they want more information about your product, yeahfor sure or for any listeners out, there feel free to reach out to medirectly at Andre at Rampo. That's a nd Rey at Rantom were also happilypartnered, with Berkly, so feel free to reach out to your Brooklyn, rep orCountin, and they can get you in touch with us as well. Great. Thank you. So much you've been listening to start upsuccess to make sure you don't miss out on future episodes subscribe to theshow in your favorite podcast player. Like would you hear tap the number ofstars? You think the show deserves an apple podcast for more tools andresources for your own start up. Success check out Bergland associates.Thank you so much for listening till next time. I.

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