Branding for start-ups in Fintech
Fintech start-up brands are an attractive and challenging area of conversation. Who doesn’t like to talk about brands? On the other hand, how well have fintech brands done? Digitization in fintech start-ups is focused on features, functions and clichés. People use features and functions and are sought to be persuaded by clichés. But they use brands.
The space of the brand is complicated. The tech startup world is mostly not comfortable with IT. It tends to look inward, where the technical building happens. Chilled indoor hooks, beanbags and cubicles, Monday morning stand-ups. Start-ups are organized around planning, delivery and hustle. Leads are expensive to serve and can distract teams from coding and whiteboarding. We have rarely, if ever, seen a fintech entrepreneur who is from a brand domain. Brand value is not much talked about in an ecosystem where numbers fly around.
It can help to do a headcount on how many people in a fintech fit the brand. Then one can look at a thorough analysis of branding that is done in-house – not by outsourced marketing teams. That said, you can’t really blame fintechs. It is tradition for the innovation community to build the technical product first and then look at the brand. This is logical – after all, what is a brand without a real product? And how many people are reached? How much will all this cost? The counter-challenge, however, is deciding when branding begins. In the end, you have a tired team that just wants to move forward, with deadlines for releases and reviews.
We love to talk about PayPal and Stripe. However, not much is said about the brand’s prominence and the share of voice that was built up tenaciously over the years. It may be a story for insiders to tell, but it’s arguable that branding was part of product development – as it should be. This is a difficult action to carry out. It also means abandoning some processor orthodoxies (to be fair, they may not have existed when PayPal came along). Stripe has the advantage of being a B2B play, but what it has achieved is significant. When it comes to consumer-facing fintech brands, GCash and MPesa are holding out. These are not start-ups in the normal sense, but category creators. That these remain top of mind after so many years is remarkable. Still, it’s also worth noting that the fintech space in their home country is getting crowded, which will make brand games interesting over the next decade.
But what about new banks and digital banks? You can distinguish between them and other fintech players. They come with a comparative resource advantage and imposed role that the others do not have. It is not unfair to suggest that next generation banks have evolved to be early fintechs. Still, fintechs can learn by observing the new dynamics between them and their customers over time.
As the global economy enters uncharted waters, more attention will be paid to performance. Technical stacks at the back are no longer differentiated. User interfaces are starting to look similar. Fintech start-ups will find it increasingly challenging to grow unless they find core values that customers or consumers can buy into and stick with. This is where branding comes in. It will be the representation and personalization of everything the startup is about. The development of the brand must be part of the product development and deserves equal attention.
Do all fintechs need to have a good branding game? It depends on. If your brand needs to be recognized by the market (consumer or business) that has another choice, your brand assumes great importance. You can also choose to remain in the deep background, and there are many such companies. Their work does not need to be promoted and they are locked into strong contracts. But I feel that a large and growing brand rating will be more than helpful.
Note- The blog above expresses the purely personal opinion of the author and not the companies he is affiliated with in any way. He does not recommend, endorse or advise on the purchase of shares of companies mentioned here and this blog is not intended to solicit clients or provide investment advice of any kind.
