Show Notes

They say that slow and steady wins the race, but how many tech startups succeed with a patient approach? Cash management startup Neo is a shining example of slow and steady winning the race. While waiting two years for regulatory clearance, Neo built a huge customer base before they could even sell. Now they are poised to reap the rewards.

CEO Laurent Descout and Chief Product Officer Emmanuel Anton, joined startup coach Roland Siebelink on this week’s episode of the Silicon Valley Momentum Podcast. They discussed how Neo used those two years to its advantage and shared other insights into the young company’s keys to success.

• How Neo gained insight into the pain points of its core customers.
• The formula for keeping all four co-founders on the same page.
• The right time to do away with generic roles and give team members clear roles.
• The importance of listening to potential clients to create the right product.
• Why trust within a founding team is an essential part of success.

*Sharing below the full transcript of Roland’s conversation with Neo Founders Laurent Descout and Emmanuel Anton*

Transcript

Roland Siebelink:Hello, and welcome to the Silicon Valley momentum podcast. My name is Roland Siebelink and I'm a scale-up coach and adviser. And today, I have two awesome founders with me coming to us live from Barcelona, Spain, it's Laurent and Emmanuel, the CEO and chief product officer of Neo. Hello guys. Thank you for joining us.

Laurent Descout:Thank you for having us tonight.

Roland Siebelink:Excellent. Laurent, tell us, just for people who, if possible, have never heard of Neo before, what do you do and for which target group do you solve what problem?

Laurent Descout:Mostly we are what is now called in Europe a challenger bank. We mostly work for corporations across Europe, helping them operate worldwide, opening a multi-currency account that they can use to be paid from their clients, that they can use to pay the suppliers, and having a layer of advisory so that they can manage the foreign exchange exposure at the best.

Roland Siebelink:Okay. You're saying the client group is really corporations. How do you differentiate between maybe size or industry? Do you have a clear target group in mind?

Laurent Descout:We only work for corporate clients. We don't deal with individuals. We are a pure B2B service. We have some verticals that we have more preference or a natural fit with. But any corporate that is working globally is normally in the need of the services we provide. If either you find difficulties in opening a multi-currency bank account or you think your bank is charging way too much for your international transfer, for ethics risk, this is definitely the type of client who can come to us. In practice, what we see is we have clients in the software industry. A very young startup but also scaling up. We have fintechs as clients. And we also have a lot of clients in the asset management industry.

Roland Siebelink:Emmanuel, to get you in the conversation, obviously, `this is something that has been offered by traditional banks and other players as well. How does Neo differentiate itself from those traditional players and from other challenger banks in this field?

Emmanuel Anton:First, we're faster. It's really quick to open an account with us. We completely integrated the chain and we produce our IVANS ourselves so we can equip our clients in a really short period. We have, I would say, great support. We're digital like most of the competition and more digital than the banks, of course. But I think one of our major assets is our support. Our clients love that because we are there. We are replying. We are assisting them every step of the way. Plus, the platform we have developed is a one-stop shop and they have all the functionalities. We give them all the information they need without any limit in time. They can tweak what they see on screen, so they don't necessarily have to export. I think the tool we provide is also very complete, an advanced one.

Roland Siebelink:Excellent. Can I also introduce to the listeners the fourth person on this podcast is Carlos Founaud, who is our local scale-up startup coach based in Spain. Zaragoza to be precise. Carlos, you had a question for Emmanuel or Laurent as well.

Carlos Founaud:I got a question. I'm very surprised you're working mostly with the new economy. I thought you were going to be working with the traditional large corporations. And I wondered, how do you make the first approach to these CEOs or these CFOs? How did you get to them?

Laurent Descout:We have been working in treasury functions across team members for a while. Either on the market, on the hedging functions, or I was myself a financial advisor to corporations for a long time. What we've seen is we find out that many companies either have a very hard time opening an account. The opening of an account has become Europe - and I think it's probably due to the fact that regulations just keep increasing and that banks have less and less appetite or will to be very punchy in terms of getting new clients. We see a lot of clients coming to us and finding us on their own just because they have a very hard time opening a simple bank account. On top of that, what you're looking for, it's not a simple bank account. It's an account that works perfectly with 30 currencies that can accept them, that can pay them, that gives you all that you need so that you can perform your reporting. It's even harder and harder. Mostly, what we try to find when we search for clients are companies where we can easily screen the geographies where they're operating. And that gives us a very good insight on what are their needs. Are they exporting to South America? Do they have subsidiaries in Southeast Asia? Are they themselves a subsidiary of a Swiss-based company? All this gives us some insight that there is a currency need. And then after, it's very much a matter of finding them in the right places. That may be LinkedIn, social press, or social media. And it's making the right pitch. Do you have hard times opening accounts? Are you satisfied with your international operations? Do you think you pay way too much for your international transfers or even for your exchange? Every client who may say yes to this, is normally interested in hearing what we have to say.

Roland Siebelink:Can I just interrupt you, Laurent, and say that that is just a great example for the founders that listen to this podcast of really identifying the pain points in the mind of the customer, from the perspective of the customer, and getting right to the point. What value am I providing? What difference am I making? That's an awesome job.

Laurent Descout:This is critical. I'm not saying what we've done may work for everyone. But what we've done during the first two years of Neo - let's say that in the FinTech space, you have one natural disadvantage. You need to have the right regulation in place to start operating. In our case, we had to go through national bank approval for payments. We had to go through national market authorization for the FX dealing. That takes two years. You can't go quicker or slower, which is very often the case, but it's going to take you two years. The way we approach it, knowing it from the start - meanwhile, we have this application going on. We're going to go on a roadshow and talk to as many CFOs and treasurers that we can with a simple approach. We have nothing to sell to you today. We want to know what is the international bank account that you want? What is it supposed to be? What is it supposed to do? And we've done that during two years. What happened during two years? We built very close contacts. More with a generalist approach. And during two years, we built the lead base. And now what we've done, from the very first day we had the license running, we call back all those people and we say, "Look, since the last time we talked eight months ago, we built an MVP, now we have the license, are you willing to try it?" That's what we've done. And honestly, we are still living on this. But what's been very interesting on that journey is that it brings you also modesty. Honestly, we've seen pain points that we did not imagine. And we discovered that some very little things have a massive impact for clients. Things that, for us, on a powerpoint, would have been nice to have was suddenly a must-have. Things that for us was a must-have, was suddenly nice to have or an absolutely not needed feature. And then, you look into that and you say, "Wow, lucky I had all these talks and I talk to all these companies from machinery, from services companies, from importers of a table of chairs, shipping companies, renewable energy." Everyone with this different set up, with this different type of accounting, everyone from one person CFO to departments with 30 people at the treasury. And you start seeing the pain points. Like "I want to spend less," or "I want to do things more efficiently. I'm afraid of fraud. We have problems with reporting. We want to automate that. We want to work remotely." All those things, we put them together. And when you have the chance of adding a bit of time to organize this slowly, and many times too slow, but it starts shaping your product, shaping your approach.

Roland Siebelink:How have you divided up responsibilities between the co-founders? That's a question I often get from founders. How should we split up the jobs between us?

Emmanuel Anton:Laurent does everything and we do nothing.

Roland Siebelink:Excellent. I think we've got the title for our podcast episode. That's amazing.

Emmanuel Anton:I think our founding team is very well balanced because we have Laurent that has experience across assets, across competencies. He can speak about compliance. He understands the financials. He understands the product. He knows the regulation. He's the one putting everything together. And then we have Ian, our co-founder, who is in charge of the IT that I work very close with, as I'm in charge of the product. And then we have Nuria, who is more in charge of all the regulatory and also financial aspects. That little team works well because Laurent is making sure that everybody is speaking to each other and things are smooth. And when there is a decision to make, he is the one to put us in the right direction.

Roland Siebelink:Excellent. Okay. Laurent, back to you. How do you manage such a complex business with just 30 people and four co-founders? What is the most complex and how do you, as a team, wrap your head around the complexities that you deal with?

Laurent Descout:For me, probably the most complex part of things is really putting the right person all together and making this work. Even though you have a clear view - and I think from the very start, we all know what we want to build, and there's just no debate on that. We are all aligned with this. The thing is, how do you make that vision happen and how years after years you go on building your business in that direction? I think it all goes around having a super-motivated team, knowing that everyone is here for a very clear function. For example, it's not so much on the founders, but when we hire new positions, we pay a lot of attention on having a super-precise job specification, I think from experience, if we look at what has not worked so well in some occasions is when you have this broad scope of "This is your position, but it's not exactly super detailed." That's why you get people lost and they lose sight of what is their day-to-day job. And at the end, everyone is expecting someone to fulfill a clear set of tasks. We spend a lot of time really making sure that everyone has a clear understanding of why he is here with us. Everyone can bring some ideas on all the topics. But we try to avoid adding people being generic. Everyone is here for a clear mission. Of course, everyone has a good understanding of what part he's playing, so that everyone feels that all the team is working together and working together at the same pace. It's useless to have someone who's a superstar but is going alone and no one can follow the reason. We always try - and the more and more we recruit - to tell people, "Okay, this is what we're hiring you for. And that's what you need to deliver." If we hire someone in the compliance field, it's for a very specific mission. It's not for a general task like you need to make things right. No, you need to come to do this. That's extremely important. Extremely important. And the less people you are at start, the more important it is. Of course, you have moments when you need more generic people who are able to be flexible. And flexibility is key. But once you pass 10 people, you need to have clear duties, clear roles, and clear missions.

Roland Siebelink:Yes, that's a big breaking point. I think that makes a difference. What has been your experience -Emmanuel, you can chime in as well - when you did pass the 10 people? What started changing and how could you establish more clarity in, as you say, telling everyone exactly why they are there and what their expectations are for their role?

Emmanuel Anton:One thing that will fit nicely with your question and complete what Laurent was saying, we've been very lucky at Neo because we only had to start recruiting people - external people, let's say - after a while. We came with a founding team but also, we had in mind people that we had met in our previous lives that we wanted to work with. It took us a little bit of time. Only the four of us - five of us, let's say - to get things going. And then we brought into the project, people we had worked with in the past. It's like bringing friends and family.

Roland Siebelink:Very good. Let's talk a little bit about some of the key accomplishments that Neo has shown so far. What are some of the results you guys are most proud of? And if you're willing to share, maybe there are also a few challenges that you guys are still fighting with and maybe some people could offer help with that? What would you like to share?

Laurent Descout:In terms of achievement outside of building a team and living a fantastic journey and experience, I think what we're super proud of is we managed to build from scratch, in our tech jargon, what is a banking system. Not only did we put a nice front end or a nice design to solutions that others did before and we just refreshed it. No, no, no. From scratch, we built a full banking system that even banks are coming to knock at the door to see if they can use it. And the other thing we're super proud of is we serve today a bit more than 150 corporate clients across Europe. All our clients are super happy. They all have things that they don't like or things that haven't worked well and so on. But they always tell us, "You know what, guys, you help us. You pick up the phone, you're you're for us. And what you build and the way you support it, it helps us on a daily basis. This is fantastic. When you get that from your client, this I love. This I think is what we're super proud of. The challenge is, I would say as a founder and CEO, is the Neo I have today is the Neo I thought I would have already two or three years ago. There's this gap between things that are in your head for five years, and still they are not done. What I thought was a two-year journey, maybe took 10 years. Handling that gap between what you want to have and what you think the market is needing, and seeing it arriving really on the table and many people using it, takes always so much time. That's the frustration, I think, of the founder.

Roland Siebelink:Somebody said that as humans, we always overestimate how much we can do in two years, but we really underestimate how much we can do in 10 years.

Carlos Founaud:By the way, how are you finding Neo? How are you finding yourselves, let's say in three years time?

Laurent Descout:I always say that things go fast, and at the end, things don't go fast. If I look back three years ago, most of the FinTech scene was as it is now. In one sense, we always have this feeling that - and sometimes it's not only related to what we build; it can be the pandemic. All those things which were not imaginable a year ago, suddenly they materialize. I think we are used to living in a world that gives the impression that it's changing extremely quickly. What will be Neo in three years? I can only tell you that those are the features we are designing now because between the moment we designed them, we put them in production and it gets real, and then it's adopted by the clients, it's three years. In three years time, the Neo account will not only be a super nice and efficient bank account, it will be interconnected. Connected to the clients or the banks. Connected to the client's accounting system. This is for sure Neo in three years. What will be Neo in 10 years? I definitely think Neo in 10 years will be like a small JP Morgan operating across the globe.

Roland Siebelink:I'm going to close with some questions about advice to other founders. Maybe the same question to both of you. One is how do you keep learning? How do you make sure you get advice where you need it? And two, what's the key thing you would tell to founders who are just starting or are a few years behind you? What's the key learning that you would like to convey to them? Let's start with Emmanuel and then we'll close it with Laurent.

Emmanuel Anton:Perfect. Because I'm going to be way shorter than Laurent on that one. My biggest inspiration and my biggest source of knowledge is Laurent. He's reading a lot of books. He's really on top of all the economic trends, everything that is happening in FinTech and the tech world. Ian is also very curious about everything that is happening on the tech scene, the new languages and stuff. I learn from these people. I'll be very honest, I'm not a bookworm anymore. I read the news, et cetera. But I learn from these people. I try to surround myself with people I'm friends with but that have knowledge that might be useful. I can go to them and ask and they share their knowledge, their time with me. And then I can give it back to Laurent and the rest of the team. And if I had to give advice to people, never think that a project is a sprint. It's a marathon. Be prepared for that. And surround yourself with people you trust and that have the same goal. I really admire people who are going alone in a project. But from what I've seen, none of us would have been able to achieve what we have achieved on our own. It's good to be a united founding team. The team that is too big is not a good idea. But the four people we are is really a good number. And it has been really helpful not to be alone because you have people to speak with, people to rely on. When one is a little bit down, the others are motivating him or her. If you can, don't go alone.

Roland Siebelink:Excellent. That's really good wisdom to share with other founders. And back to Laurent, the source of all wisdom.

Laurent Descout:I think what I would tell to funders or people who may think to become co-founders and so on is first, talk to a lot of people. Talk about your project to as many people as you can. And many times, I look at what was my LinkedIn network before being an entrepreneur. I may have had a hundred contacts, and now I may have 6,000. It's so easy to talk to people now. Use this, that's the most. Then choose who you listen to as well. It's nice to talk to friends or so-called advisors or whatever. Talk to potential clients. Talk to potential clients, listen to what they have to tell you, listen to where the pain is at the end. A business is driven by the market and by the demand. This is what you have to listen to, and you'll be very surprised many times by what you hear. And then build trust with your founding team. Go with people you can trust, people you understand, people you know, people you can rely on. Honestly, they will become your second family. Don't underestimate the times that you will have doubts, the times you need to have someone you can call on Sunday at midnight. When you have that, it's good to go. That's my main advice. Then after you need passion. You need to do something that really motivates you. You can be excellent and you can build an amazing business in everything. I've always thought that there are businesses in which I will never be good because I don't like it or I don't understand it. What I know how to do is help a treasurer who is having a hell of a problem who doesn't know how to deal with it, who has no management who is giving him a budget to improve his performance. I know how to solve this pain point. And I find it interesting. It's me. Don't ask Steve jobs to sell ice cream. He liked to build computers and then to reinvent how we lead the digital age. Others like to send space rockets to Mars. You need to find your thing, and then you need to find the people who are going to help you make it true.

Roland Siebelink:Last question. When people want to hear more about Neo, where should they go and what particularly should they look for and download?

Laurent Descout:Yeah, I think they should definitely take a look at our website, getneo.com. That's mostly where they have a description of the services and the type of product we're launching. And if they have any requests about Neo: [email protected]. Seems to be a generic email, but we answer all of them.

Roland Siebelink:Excellent. Very good. And if any investors still want to be part of this new round last-minute, then I'm happy to provide introductions to Laurent as well.

Laurent Descout:We'll be very happy to talk to any investors, whether it's for this round or sometimes for the next one. Time flies, and the more we know, as I said before, the more you know people and the more you understand what they're looking for, the more likely you're to be there, even if it's for the future.

Roland Siebelink:Perfect. Okay. Thank you so much, Laurent and Emmanuel, the CEO, respectively, and chief product officer for Neo. I was really happy to have you on the podcast. Thanks so much.

Emmanuel Anton:Thank you very much, Roland. Thank you very much, Carlos.

Roland Siebelink talks all things tech startup and bring you interviews with tech cofounders across the world.