How today’s fintech CEOs steer clear of pitfalls while growing their companies

Writer’s Note: This story is the fourth part of the series, ‘The Journey to Leadership’, spotlighting six fintech CEOs and their individual journeys. In the inaugural installment of the series,  I explored the key lessons these leaders have learned and how their diverse experiences — from triumphs to setbacks — have sharpened their perception of their roles and capabilities. The second installment of the series highlights the ‘what ifs’ in the decisions these fintech CEOs would have reconsidered if they could start over. The third part explored how these fintech CEOs hone their professional skills while overcoming personal obstacles and how personal growth can influence and improve their leadership approach.

This fourth chapter delves into professional practices these CEOs have encountered in their careers that they are determined to leave out of their own organizations.

Serial CEOs and first-time leaders alike have encountered professional practices during their early careers that didn’t sit right with them. These experiences – whether in communication, culture, or technical strategies – have stayed with them throughout their careers, leading them to avoid similar approaches in their own companies consciously. We take a look at these practices and why they didn’t resonate with these leaders.

Avoiding the pitfalls of pricing strategy

Immad Akhund, CEO and co-founder of Mercury, points out a key issue he observes: startups often set prices too low or rely on low pricing as their primary competitive edge.

“It’s one of the big mistakes made in fintech,” said Akhund.

He argues that prioritizing cheap prices means sacrificing control, as competitors can always offer lower prices, and price-sensitive customers are unlikely to stay loyal. This, he believes, leads to a “race to the bottom.” While Mercury aims for growth, Akhund is careful to steer clear of the pricing trap, focusing on balancing pricing with the value proposition to ensure that the firm’s success metrics remain sustainable.

Picking the best mode of communication

Using email to communicate with team members is what Stephany Kirkpatrick, CEO and founder of Orum, has vowed never to implement in her firm.

“We use Slack instead of email for our internal company comms. Email murders focus, productivity, time, transparency, prioritization, and so much more,” she said.

Kirkpatrick is of the opinion that email was designed for a different era, one that contrasts sharply with today’s work environment. Although it could be useful as part of external communication, it falls short of facilitating effective internal communication.

“We’ve created a very clear bifurcation: Email is largely for external communications like with our board, investors, customers, partners, and vendors. Slack is about what needs to be done and communicated internally,” added Kirkpatrick. “This divide has taught us so much.”

Kirkpatrick notes that the selection of an efficient internal communication channel can greatly affect the prioritization of tasks. In the fast-paced world of startups, the sheer volume of information can be overwhelming — far more than what one can tackle in a single day. Emphasizing the importance of prioritization, Kirkpatrick believes that email fails miserably in this regard. In contrast, Slack offers a way to filter communications based on daily priorities, allowing her to focus on what matters most and giving her the flexibility to engage with other parts of the business as needed. 

“When you divide your comms, you can magically prioritize far better,” she said.

This approach also keeps product, commercial, and marketing teams updated on customer activities, company metrics, new product launches, and other important developments, with the opportunity to add their input to the discussion.

“Our culture also encourages people to have conversations in the “open,” a team channel. While there are times that direct messages are appropriate, in many cases, we want folks to be comfortable speaking in a public channel that is transparent for everyone,” Kirkpatrick noted.

What “not” to do in creating a strong company ethos

Michael Rangel, CEO of Novo, came to appreciate the importance of clear communication in influencing internal culture early in his career, long before he founded his current company.

Rangel found the opaque decision-making and closed-door approach at a former job problematic, as it lacked reasoning, communication, or insight into how decisions were made. The lessons from this experience have stayed with him, leading him to consciously avoid similar practices in his own company. He emphasizes the need to outline the rationale behind leadership choices, whether good or bad, to employees to prevent any negative sentiments and reinforce their sense of being valued within the organization. He believes this is closely tied to building the company culture.

“Executives [at one of the places I worked] didn’t really tell employees why certain things were being done,” said Rangel. “At Novo, I’ve always tried to lead with transparency. I welcome questions about everything I do, and I try to communicate as much as possible.”

Rho CEO and co-founder Everett Cook notes that many finance organizations are highly focused on short-term results without first solidifying the company’s core principles and cultural foundation, a practice he believes is detrimental to long-term viability. 

He advocates for prioritizing the development of a strong company culture, processes, and values, which are essential for lasting success before setting new goals for the organization or employees.

Establishing a strong company culture is also at the top of the list for Colin Walsh, CEO and founder of Varo Bank. However, he is also adjusting to contemporary needs by incorporating a flexible and inclusive strategy that encourages collaboration over internal rivalry.

Experienced business leaders often have a wealth of experience in finance, corporate strategy, or operations, but in today’s rapidly evolving world, this alone might not be enough to turn their goals into sustained success. Navigating the new environment calls for a departure from old habits, driving a transition from the old ways to the new.

“I have committed to eliminating outdated models of internal culture practices,” Walsh noted.

To support a more equitable workplace, Walsh has eliminated practices such as enforced talent rankings, exclusionary events like golf outings, and strict hierarchical structures.

“We’ve taken a more inclusive approach to building our business, one that believes in the strength of ideas, not titles, to drive innovation,” noted Walsh.

Looking at these strategies employed by both novice and veteran CEOs shows how today’s fintech leaders are taking steps to connect with their employees on various levels. They are driving a shift toward a more nuanced approach to internal culture and employee relations, with an increasing recognition that soft skills are as critical as hard business skills for improving organizational performance in today’s competitive market.

• The first installment in the series explored: What lessons have fintech CEOs learned while mastering the art of leadership?

• The second installment in the series explored: What different choices would fintech CEOs make in their leadership strategies if they could turn back time?

• The third installment in the series explored: How personal growth and skill development can influence fintech CEOs’ leadership styles?