Three key communications challenges for a fintech start up
From payments to crowdfunding, wealth management to social trading, waves of fintech disruptors have been taking aim at established financial services industries. According to management consultancy Accenture, investors poured $5.3 billion into the fintech industry in the first quarter of 2016, a 67% increase on the same period in 2015.
While there are no official figures quantifying the exact number of existing fintech start-ups globally, conservative estimates put the number between 5,000 – 6,000. This interactive mind map by business strategist Reuben Levy gives an indication of the shape and areas of disruption happening in the industry.
The financial backing behind these companies, allied with the increasing amount of press attention they’re receiving, means defining these brands’ purpose and communication strategy is becoming more important.
Beyond the initial halo effect of scoring your first piece of TechCrunch coverage and adoration from the media on meaty VC rounds, what are the communication challenges fintechs should consider in a landscape of hardy financial institutions, technology disruptors and “me-too” peers and competitors? Here are three to consider:
- The right time to scale your communications
There will come a time when the multi-talented business development/marketing/operations manager needs external support to scale a communications strategy that matches business growth ambitions. That might be during a push for a funding round, or when customer acquisition and usage becomes the business priority.
Either way, the point at which a company transitions from start-up to fully-fledged business is often the time to re-evaluate the communications approach. If business priorities change, the comms plan needs to change with it. If the target audience evolves, so should the content strategy and channels to reach them. And if the business focus or goal changes as it grows and matures, then the messaging is likely to need altering as well.
- How to stand out from the crowd
The financial services industry faces significant challenges as new players, unencumbered by legacy systems, change the industry. But when the sector is flooded with other disruptors as it is now, one key challenge is separating the wheat from the chaff. For every Lending Club you’ve heard of, there are tens or hundreds more striving for similar attention.
Take CircleUp, Zoomaal and WeFunder as examples – what do they all have in common? All these companies focus on equity crowdfunding. Just as the word crowdfunding has become normalised in the English lexicon, the number of companies in the sector has grown rapidly.
In a crowded marketplace with established players such as Seedrs and Kickstarter, how do companies ensure they are telling a compelling story to avoid falling into the “not-another-crowdfunder” category? Equally for the incumbent disruptors, how do you ensure you maintain meaningful conversations around issues that matter?
- Articulating a point of difference
Companies need a compelling reason, point of difference or point of contention with the industry they are seeking to disrupt. This rings true whether you are a brand new start-up or a mature poster-child for the sector.
Clear articulation for customers on why they should take note about a company they haven’t heard of is one way to build brand awareness. Companies like Transferwise and Atom Bank are two examples of champions who articulate this point of difference well and have stayed true to their brand purpose throughout their communications journey.
What other communication challenges do fintechs face? Tweet @HK_London.