Budapest-based startup SEON makes software that detects fraud by analysing customers’ social media footprints — a useful addition to the conventional fraud detection arsenal.
It sells its services to online gambling companies, cryptocurrency companies, online retailers and travel agents and has proved particularly popular with challenger banks racing to sign up new customers.
“It takes about 50% longer to close a deal with a big bank than with other clients.”
But Jimmy Fong, the company’s chief commercial officer, says that one type of company is notably missing from their list of clients: big banks. This is because winning them as clients is such an achingly long process it sometimes feels hardly worth trying.
“It takes about 50% longer to close a deal with a big bank than with other clients,” he tells Sifted. “We looked at all our accounts and calculated it. As a team we intuitively knew this but it was still quite shocking to see it confirmed. The pitch to banks is easy. But then 95% of the slowdown comes from the procurement process.”
He adds: “Only about 20% of our customer base are in the financial services sector. We deliberately don’t target them because of the timeframes — as a two-and-a-half-year-old startup, we can’t afford such long procurement cycles. When we do work with financial services we tend to target challenger banks rather than the incumbents.”
A new solution
There may be an answer to this problem though. Now a London-based startup is testing out a solution which might help startups like SEON get through the bank procurement process more easily.
Techpassport is a platform created by Layla White, a former procurement manager at HSBC, which is aiming to do some of the heavy lifting for startups that want to work with big banks. The angel-backed team helps startups get their compliance documents and legal paperwork in order before they engage with big banks, to make the onboarding process faster.
White, who worked in financial services procurement for a decade, says she started the company after seeing hundreds of small startups struggle to meet all the compliance and security requirements set by banks.
“Startups are often blown away by what is required when they sign a contract with a bank.”
“Startups are often blown away by what is required when they sign a contract with a bank,” she says. “But the banks can only do so much to help. At HSBC around two-thirds of my time was spent helping set up zero-value contracts and pilots with startups. It wasn’t sustainable.”
Alex Barkley, a former head of fintech procurement at a large bank, told Sifted earlier this year that there was a lot of frustration on the bank’s side when startups came to them unprepared.
White felt a middle-man was needed to help both sides.
“We help startups get their…