Ceridic from Finexkap talks about different aspects of B2B transactions and how APIs are empowering the fintech sector and financial software arena.
Cedric Teissier is co-founder and CEO of Finexkap, a working capital financing service based in France and with operations in Western Europe. Since launching in 2015, over 2,500 companies have become clients of the service. Prior to that, Cédric was co-founder and MD of Palico, the global leader among marketplaces for private equity funds and investors with offices in France, the UK, and the USA, and more than 15,000 active users in over 70 countries. In an earlier life, he was a private equity attorney with Debevoise & Plimpton LLC in New York, and a placement agent for private equity funds. Cédric is widely recognized as a leader of the French Fintech ecosystem.
1. Tell us about your role in Finexkap?
I am co-founder & co-CEO of Finexkap. Technically, Finexkap comprises three entities: Finexkap, the parent company, which is primarily dedicated to IT development and data science and where we build the working capital financing solutions to be offered to our clients; Finexkap AM, a wholly-owned subsidiary of Finexkap which is licensed as an alternative investment fund manager by the French Financial Markets Authority and which actually sells the working capital solutions created by Finexkap; and Finexkap investment fund, a special purpose vehicle financed by professional investors (insurance companies, asset managers, pension funds, etc.) and whose purpose is to provide working capital to our clients. Within the group, I am mostly in charge of the corporate development, investor relations, financing and refinancing. My co-founder Arthur de Catheu, co-CEO alongside me, is mostly running the product, sales and marketing efforts of the group.
2. Can you tell us about your journey into this market?
Not a natural one, honestly. Both Arthur and myself were working in private equity for a number of years when we started our fintech journey in 2009 by co-founding Palico, a marketplace for private equity investment funds and investors allowing primary and secondary investments to be disintermediated. Quite a revelation for us in terms of entrepreneurship, building a company from scratch, piloting the strategy, adapting to a fast-growth environment. But also too much private equity, honestly, so we decided to transition out of the management of the company in 2012 so as to build something which felt more concrete to us. And as an entrepreneur, you quickly learn that cash is everything, so we decided that we would build innovative solutions for very small businesses looking for working capital financing.
3. How do you think technology is changing the financial sector?
Everything and everywhere. Obviously given our journey within the fintech space for the past 12 years, we’re excessively bullish on this industry as we believe that we’ve not even seen a tiny bit of the revolution that the digital age will bring to financial services. Not only technology has brought new financial products (lending, asset management, compliance & regulatory, payment solutions, etc.), but it has also massively changed the environment surrounding the distribution of financial services through a disintermediation of the bank-client relationships thanks to open banking and direct-to-consumers digital solutions. At the end of the day, incumbents are being transitioned into core-banking solution providers, while fintech companies seize the client relationships.
Eventually, the winning solution will most certainly arise from the collaboration of fintech companies and traditional financial services companies, which we now see as a growing trend through strategic partnerships, investments and M&A.
4. Can you explain how does your cash creation solution help businesses?
Our DNA arises from the acknowledgment that B2B transactions are now being stored online on electronic networks. As we’ve all witnessed the birth of the Amazons & Alibabas of the world which have massively changed the way as we, consumers, purchase goods and services, the same trend is happening in the B2B world, but as always in the B2B sector, it is less visible. B2B marketplaces, B2B e-commerce websites, e-invoicing software, accounting software, etc. are now cloud-based environments in which B2B transactions are entered into or located, and our ambition is to build an IT architecture that can tap into those locations so as to transform B2B transactions into working capital financing. Our solutions are transparent, if not invisible, and accessible in a few clicks without any commitment in terms of duration or volume, no personal guarantee, no paperwork, no meeting, and with a pay-as-you-go pricing policy. Since launching the financing operations in 2015, we have provided 50,000 + financings to 3,000 + clients.
5.How does your APIs empower financial firms?
They empower everything, as they’re the backbone of our DNA. We have multiple sets of APIs for all our product range: Cash Market (APIs dedicated to B2B marketplaces through which we can connect to marketplace operators and payment service providers so as to allow sellers to be paid immediately and extend payment terms to end purchasers), Cash Connect (APIs dedicated to B2B software providers so as to provide a native working capital financing solution directly embedded within such B2B software environments), and Finexpay (‘buy now, pay later’ APIs allowing merchants to offer up to 90 days’ additional payment terms to their customers). Our APIs now provide 90% + of our origination.
6. What makes your platform a perfect fit for brokers?
Although we have a dedicated extranet for brokers so that they can open client accounts for their customers and monitor their deal flow and commissioning, brokers do not represent a strategic acquisition channel for Finexkap.
7. What advice would like to give to the Start Ups?
There are so many, but I guess one has to try, test and learn rather than relying on advice. Advice only represent someone’s own experience, and each situation has its own specifics.
But key characteristics of founders’ success are most certainly resilience and determination, capacity to pivot and question oneself, understanding the importance of a team and the company’s culture, and the perpetual focus on the clients’ needs and pain points.
8. What work related hack do you follow to enjoy maximum productivity?
Answering emails and messages as quickly as I can if they require less than 5 minutes’ worth of my time. Execution is key, and capacity to keep the ball moving at all times is an essential component of the execution. For any items that require more than 5 minutes’ worth of work, I leave them in my inbox, Slack or other messaging tool, and I seek to keep less than 30 open tasks, at all times, in such environments.
9. How do you prepare for an AI-centric world?
By building an AI-centric company of course. AI is key to our development at Finexkap, we’ve built a dedicated data science team to automate processes and underwriting decision, but also to create a company-wide intelligence system where our employees and clients can benefit from the significant improvement that AI and machine learning can provide. This is one of the strategic pillars of our organization.
10. What are the major developments you are planning, in recent times?
We currently have four strategic developments at Finexkap. First of all, we seek to partner with banks so that they can distribute our working capital financing platform on a white-label basis to their clients through their wide range of branches and local presence. Our second strategic development is to keep connecting our solutions to EU-wide B2B marketplaces thanks to our unique positioning in this space through Cash Market, which has no direct competition and generate a significant inbound. Our third strategic development is to keep distributing Finexpay, our ‘buy now, pay later’ solution for B2B transactions, whether directly in store or through digital checkouts, as all the ‘buy now, pay later’ solutions remain B2C centric. And at last, our fourth strategic pillar is to keep using machine learning and AI so as to build a data-centric and data-driven organization, which is something that incumbents currently face difficulty to build.
11. Can you tell us about your team and how it supports you?
Our team is everything. As we often tell them, their individual success and failure is what makes us what we are. We have a strong company value about accepting that we have the right to fail, but that we need to learn from our failures. Given that we have different entities to manage, our team is significantly diverse, comprising IT developers, data science engineers, asset management experts, portfolio managers, etc. So that all business units remain central to our operations, we manage the product development collectively so that each team can participate in the determination of the roadmap. Any person joining Finexkap needs to be willing to be involved in our products.
12. Which Book are you reading these days?
Not as many books as I would like, unfortunately. Having young kinds (home-schooled on top of that through Covid-19!) and Finexkap take the most of my time. But I would recommend ‘The Hard Thing About Hard Things’ by Marc Andreessen to any entrepreneur. It’s a rough journey, so you have to be prepared to go through rough (and exceptionally rough) times.
13. We have heard that you have a very joyful work culture, we won’t mind having a look at some of the pictures?
Our company culture is the combination of pressure (because startups need to go fast and cannot lose time), and team spirit. Without the team, a startup is worth nothing but a simple idea.
14. Can you give us a glance of the applications you use on your phone?
So many, and too many. Twitter, Linkedin, Evernote, Google Calendar, Google Maps, and Deliverro would probably make the cut for the most used 😉