Venture capital · Fintech

How to Attract interest in a FinTech product?

Michele Tivey COO at FinTech Payments Corp, Director CNP-Solutions

January 13th, 2016

Our product has been profitable since we self-funded our founding in 2011. We have adapted it to scale, and the concept: data science applied to payments transactions is disruptive in that: (1) it has generated over $1B in revenue for both merchants and processors; (2) nobody has our proprietary analytics; (3) nothing like it is being done in a scalable fashion by processors today. So why can't we get past the first phone call?
65% of startups fail due to co-founder conflict, according to Harvard professor Noam Wasserman. To help you avoid conflict, we’ll give you the tools you need to determine the right equity split, including the framework to measure contributions, case studies and more.

Chris Kitze CEO at Safe Cash Payment Technologies, Inc.

January 13th, 2016

You are not talking to the right people.  Payments is a highly specialized business and while there are a few VC's who know about payments, it sounds like your business is already profitable.  Why raise money and get diluted?  Many of the larger payment processors may be interested in investing / distribution / acquiring your tech or company.  VC's need to put a certain amount of money to work or its not worth their time, maybe your business doesn't need enough money.  (that's not a bad thing, just the way VC's run their business)

Cameron Ackbury President US Operations | Investor | Seeking top tier University entry level Sales, Marketing, PR Candidates

January 13th, 2016

It could be one of many things: is it unique, different, competitive, disruptive, white space opportunity, CEO/Executive team with exits, the types of VC's, your financials, your messaging, the technology itself, the space, revenue model (freemium/trial), financial metrics like CAC, etc etc etc.  We help clients get funded and we get this question a lot. 

Shane Ballman I make aircraft maintenance easier to manage

January 13th, 2016

If you're not talking to investors in Atlanta, maybe you should be: 70% of all payments in the US go through Atlanta

Then again, to echo Chris - if you're profitable, why dilute? Can you use your revenues to fund your growth?

Ryan Hemingway Director at EPIC Ventures

January 14th, 2016

 Michele, This is a high level opinion since I don't have all the details about CNP Solutions but I took a look at your website.  It sounds like CNP is a consulting business.  Under Press and News there are several articles that refer to CNP as 

- CNP Solutions, a Weston, Conn.-based consulting firm

- Led by payments consultant CNP-Solutions

-The Connecticut consulting firm

Most VC's invest in software. If the majority of your revenue is generated through consulting activities then it doesn't surprise me VC's are passing.  No VC's that I know me included would ever invest in a service business for all the reasons you would expect (scaling takes much more capital, people are your assets, lower multiples when you exit etc).  If you are selling software or are in the process of becoming a software business you might have better luck spinning the software out into a separate company and looking for capital based on the software without the consulting business.      

   

Michele Tivey COO at FinTech Payments Corp, Director CNP-Solutions

January 14th, 2016

Ryan, oh that is such valuable information, thank you! Yes, CNP Solitions does do consulting but we have developed a proprietary piece of technology, called STARRS, which is separate from the consulting. It is fully automated and scalable, but now that you've uncovered how we appear I agree with you that at the very minimum we need to dos one work on our SEO.SEM. The product has a separate logo, and a separate client base. A second company and website makes so much sense!!! Cannot thank you enough. 

Kelly Kuhn-Wallace Tech startup consultant, founder coach.

January 13th, 2016

That the company has accomplished so much is impressive, but somewhat irrelevant to VC. How will you add massive value to your business (and theirs) is key.

Todor Velev Managing Partner, EEI Network

January 13th, 2016

Michele, if you could send me your pitch deck, i will be able to provide you with a feedback. Otherwise it is going to be too speculative Todor Velev Sent from my mobile

Michele Tivey COO at FinTech Payments Corp, Director CNP-Solutions

January 14th, 2016

Thank you for the feedback! A CEO with exits is one of the things we are Looking for in a cofounder. We are profitable, and self-funded, so profits funding next steps is unreasonable. Truly, a partner -- who is a payments Processor with a good base of clients, (even under 100) to use the technology is ideal. Then, it's a $500M+ package for VCs. We've had positive meetings with Presidents, CEOs, CTOs, of everyone from Tsys to Paymentech, but never went further. Now it seems, we need to pair with a smaller processor or acquirer, make them a ton of money, and then get acquired. A cofounder who knows how to get the big exits I guess?? Maybe that's what we want, not a VC?! Michele Tivey Director, Global Communications CNP-Solutions.com @CNPSolutions Facebook.com/CNP-Solutions (203) 557-9555

Frank Pagano President of Investment Banking at CapitalFix

January 14th, 2016

Please send pitch deck as we have dozens of private equity group players who would structure for a 3-5 year exit.
fpagano@capitalfix.co

Michele Tivey COO at FinTech Payments Corp, Director CNP-Solutions

January 14th, 2016

Thank you for the feedback! A CEO with exits is one of the things we are Looking for in a cofounder. We are profitable, and self-funded, so profits funding next steps is unreasonable. Truly, a partner -- who is a payments Processor with a good base of clients, (even under 100) to use the technology is ideal. Then, it's a $500M+ package for VCs. We've had positive meetings with Presidents, CEOs, CTOs, of everyone from Tsys to Paymentech, but never went further. Now it seems, we need to pair with a smaller processor or acquirer, make them a ton of money, and then get acquired. A cofounder who knows how to get the big exits I guess?? Maybe that's what we want, not a VC?! Michele Tivey Director, Global Communications CNP-Solutions.com @CNPSolutions Facebook.com/CNP-Solutions (203) 557-9555