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FINEXTRA: What is Anthemis’ core business – are you guys a traditional VC fund or more of an advisory firm?
NAUIOKAS: I think we are right in the middle of both. So our core business is, and has been since its inception, one part advisory – where we take a role of senior advisor to a whole host of financial services organisations and institutions that are looking to digitise the future of their business. Separate to that we have an investments business that is a portfolio and managements business for entrepreneurs and startups and early stage companies in this space that are looking to solve the problems that financial institutions are recognising are opportunities.
FINEXTRA: What is your personal vison for the future of financial services?
NAUIOKAS: To think about the future I think a bit about the past. Sean [Park] and I built our careers in Wall Street firms on the back of financial technology. We weren’t just contrarians or new minded thinkers we were kind of ‘crazy people’. Half the time we would come and people would hold up their hands and say ‘here they come again these people who are going to convince us why ‘the future is now and everything is broken!’.
FINEXTRA: But you were crazy people who came from established banks.
NAUIOKAS: Thanks right, inside the status quo so to speak. Our jobs were to be the disrupter, to be the contrarian to be the new ideas. I think what happens is you eventually become an evangelist and other people start to listen to you and talk with you and then there are others that believe in you and then people start to listen. And the trend now, and certainly in the last couple of years – that has been significantly different.
The reason why we are seeing so many folks say they are jumping into this space as investors is the market is really beginning to understand and appreciate this opportunity in a way that they never had before.
And so now, all those crazy contrarian thinkers are actually becoming influencers, it is a wonderfully wonderful place to be in as a professional, but also for Anthemis because we have been committed to this for so long and we have a track record both on the advisory and the investment side. But the real difference when you see a trend like this is – if the participants in the market that need to be the change agents are also seeing a need for change. Then you know something going to happen.
From our perspective, it is a fantastic collaborative time. Big bank institutions are ringing us up on a regular basis talking about ways we’re going to collaborate, ways they can involve themselves with some of our portfolio companies and just ways they can think about the future. That is a very different picture than say five years ago.
FINEXTRA: Was being a contrarian in a traditional bank an uncomfortable place to be?
NAUIOKAS: For me it was never uncomfortable, I have never been a business-as-usual manager. I think ‘square peg/square hole’ wouldn’t have worked for me in any environment. I think that I have had a lot of success in the roles that I have had simply because I was willing to speak my mind and come up with new ideas and visionary thoughts that other people may not have been looking at.
That said, you know, the Athemis dream and the idea of going out on one’s own really typically comes at a time when you sort of see an opportunity that you feel is too big to pass up and if you stay inside you may not be able to take advantage of it as much as you could if you went on the outside. For me, it’s about being part of an environment that will reward value and appreciate the skill sets that I bring to the table as oppose to a structure that limits your own growth.
And I think being a senior woman in FinTech during the 90s and 00s – the opportunity to start my own thing made a lot of more sense to me than going up the chain of command, so to speak.
FINEXTRA: So what brought you back to Anthemis?
NAUIOKAS: It was a bit of serendipity and a bit of a too much of a good opportunity to pass up. Sean and I started what is now Anthemis in 2009. When Nadeem [Shaikh] come on to start the advisory business and grow the platform, it allowed me to follow my own dream and start a media company in the states, which I have been doing for the last few years. When I moved back to London, my intention was to take a bit of a sabbatical year – a thinking year – less doing more thinking.
As luck would have it Sean and Nadeem and I got together in the fall and they presented me some of the opportunities that were extremely hot for the picking – both on the investment side and the advisory side. To be fair I had been a part of the group up until that point – I had been an investor, been on the investment committee, I’d been part of the advisory unit – but it wasn’t until I sat down with Sean and Nadeem and saw the stars in their eyes and all the wonderful stuff that is happening in this world.
Part of it was, as you said, this massive interest in FinTech right now. We’re cool now. If I had a dime for every time I ran into someone on the street who was an ex-colleague, who says ‘oh now I’m doing angel investment in FinTech’ and we have a laugh on what their definition of what FinTech is. And I stand there and think: ‘if I am really going to do anything in FinTech, I only have one horse I’m going to back’ and Anthemis was the obviously choice.
It’s exciting, it’s an exciting time. What with what the team has built is phenomenal. The platform is fantastic. The demand is through the roof. It is always a great place to be. You’re right, they are listening now, and they are paying attention. It is a great time to be part of those conversations.
FINEXTRA: What drives you personally?
NAUIOKAS: I’m motivated by doing good work. I’m motivated by being appreciated for the work that I’m doing. And I think I am motivated by helping people execute their vison at pace.
I think for me that is one part, taking what Anthemis has built and help taking it to the next level, but also with the entrepreneurs and the startups that we’re funding and supporting and incubating. There is something about meeting someone who has an unbelievable idea, but just can’t quite figure out how to execute it. That is always something that has come very easy to me. And I think in the VC space it is a great skill to have. If you can put a team together, identify an idea and help them build a plan that they can execute at pace than that is a win win for everybody.
FINEXTRA: How do you bring your experiences from outside the banking world into the FinTech space?
NAUIOKAS: I think a few years ago I would have been quick to justify and defend all the different parts of my life and how they all play together. Interestingly enough, in the last 18 months I haven’t had to do that very often and I think it’s because people are appreciating that the trends that are driving financial technology or media technology or consumer behaviour – are all converging now. And if you can look at a product and a service from a customer’s perspective and recognised that the customers have changed. Their appetites for how they consume information has changed. Their appetites for how much interactivity that want to have, with whatever it is that they are doing, has changed. Even their knowledge base has changed. In the financial services world, that mean everything has changed.
But it is not that dissimilar to how people are consuming media and people are consuming any product and service. That is a significant shift and it gives some power back to the consumer in a way that I think has probably always been true, but I don’t think companies have recognised the need to pay attention to that consumer demand.
FINEXTRA: Why do banks seem to have difficultly seeing their products from a customer point of view?
NAUIOKAS: I grew up inside financial services largely as a marketer. Marketing has historically never been a field that people have valued inside of a number crunching, bottom line oriented space. I think that is changing. It’s certainly changing in banks. Some of the biggest success stories inside financial institutions right now is coming out of the retail sector where they are appreciating customer appetites – whether it be with the payments business or insurance – it is just a general understanding that what the customer wants, we need to deliver or they will go elsewhere.
The viewpoint I’ve always had has always been ‘customer centric and customer first’ – it’s end goal and how do we get there.
Historically I think the reason why it hasn’t mattered as much is, quite frankly the same reason I suggested that the structures of some of those organisational weren’t ripe for innovation was that ‘they were just too rigid.’ And there was too much of a focus on the bottom line without a focus on how do you get to that bottom line.
FINEXTRA: Is the idea that ‘the customer will go elsewhere’ not understood in banking?
NAUIOKAS: It is probably one part of a need to appreciate that there is a lot of pressure and a lot of deliverables on the plate of a banking executive right now. Sometimes it is hard to [remember] that at the end of the day we are actually serving customers – whether that is in the institutional markets or the retail markets or the wealth management market. I think the focus on regulatory reform and the focus on this level of due diligence and management has actually been really great for the customer.
I’m not saying that shareholders are not important. Shareholders are corner to any CEOs job from a day to day basis. If you focus on the product and focus on the customer the shareholders will win. Because you will deliver a better service you will deliver a better product and your customers will pay you back in spades. They’ll be purchasing more of your product, they’ll be participating more in your environment and therefore the shareholders will win.
I think what ends up happening sometimes is that there is a need to be so myopically focused on one part of the puzzle that you forget the others. I do think that is changing. I think even just the demand we’ve had from banks and financial institutions who reach out to us to talk about product design and customer acquisition and various forms of customer adoption from a knowledge perspective and that is actually a great thing.
FINEXTRA: What advice would you give a startup?
NAUIOKAS: First and foremost appreciate your own strengths and weaknesses. Surround yourself with a team that balances and compliments you. A typical and dangerous strategy from an entrepreneur’s perspective is when you see someone with a wonderful idea, who thinks they’ve got the plan, and then they surround themselves with everybody that looks just like them.
We’ve all had this conversation, whether it is diversity of ideas, diversity of opinions, and diversity of life experience – there is a lot more collaboration and success that come from a team that has complimentary skill sets and complimentary viewpoints. So I would certainly suggest that they think of their team first.
And be very careful about who you partner with. There is a lot of capital in the markets right now and that is a good thing it means that this is a robust environment for entrepreneurs, it is a robust environment to support ideas. But just because the money is there doesn’t mean you should be taking it.
Entrepreneurs have the ability now to step back for a second and talk about what that partnership means and what this money means and what that money allows them to do in the future, with that partnership. At Anthemis we take a long term view of our companies. One of the reasons why we love early stage and start up investing is we can be in early – we can help formulate ideas we can help and watch the company grow. But we are also capable as executives that have been inside large growth public companies, we know what happens at every stage. We can be their partner all the way through the process. It is easy to think there is some great capital and the strings don’t seem that difficult so I will go ahead and grab it.
Look at the quality of the money and the long term partnership that you are getting into a relationship with.