At the turn of 2020, no one could have predicted a pandemic that would send shockwaves across the global economy. In a particularly challenging year for start-ups, fintech companies have borne the brunt. Revolut, for example, went through a $500 million capital raise two months before coronavirus hit.
Few people understand these challenges as well as Ian Pope. As founder of Pope Marshall, Ian offers a talent advisory service for the neobank space and fintech markets. With 22 years’ experience in headhunting, he has spent the last 12 years working with “neobanks”.
“We work on-site while neobanks are undergoing their approval process, otherwise known as the ‘authorisation with restrictions’ stage. They want to remain hidden while they go through the regulatory process.
“Pope Marshall guides them through this. Once they get to the mobilisation stage, we find them an internal person to start training from within. They soon realise that it’s more commercially viable to employ a larger team. At this point, we help out with a thorough, considered recruitment process.”
The barriers to fintech recruitment
Like most start-ups, human resource is one of the biggest barriers to fintech recruitment. “The issue with start-ups is that there are so many things going on at once. They have no time to write a job description. We go beyond just doing a word match – we educate ourselves on the company culture, and interrogate the spec to a high degree.”
But when it comes to launching a new fintech service, what is more important – the people or the product?
“It depends entirely on whether or not they’re in a regulated environment. If they’re not regulated, there are more barriers with timelines, investment, and the market they’re in. If they’re building a widget, they’ll only have one investor – they need to build an MVP and take it to market.”
For regulated companies, however, the right team is essential. Ian notes that timelines are essential once again – but the best staff need to be present from the beginning. “You need to consider having the right people from a risk, finance and tech perspective. In those first six months, you need to have the right figurehead for the business.”
Do fintechs overlook the recruitment process?
One thing that fintech start-ups may miss is the money-saving potential of good recruitment. “Let’s say you need a CTO. You can find someone at a chief architect level and pair them with an independent non-executive. This works just as well and can save you up to £100k on salaries.”
Ian also says start-ups should be commercially-minded. “Historically, most of these companies have focused on customer care and ‘pretty’ products. But they also need to focus on the commercial side. You can’t change the world and then make money – it needs to be the other way around.”
Of course, he concedes that many successful start-ups are a case of right place, right time. “The crucial difference is that commercially-minded people know how to spot an opportunity.”
Diversity and culture: how we can attract the top talent
With Pope Marshall’s reputation for meticulous hiring, Ian is a keen advocate of behavioural tests.
“Businesses often miss vital signs early on in the interview process. To find the real top-tier talent, they need to use a combination of behavioural and technical competency tests.” He cites examples from companies such as Good&Co, who have ‘gamified’ their behavioural assessments based on input from a former Google psychologist.
“These are so much more involved. They talk about learning and development needs, work ethic, and ethos. This is so important because one bad hire could lead to untold toxicity. This could push you back six months – which is six months your competitors have to get ahead.”
Is diversity a non-issue in the tech space?
What is refreshing with fintech recruitment, says Ian, is that it’s so progressive. “Fintechs are so forward-thinking, diversity doesn’t even come up in conversation. They really do take everybody on their own merits. They recognise the benefits of a diverse and inclusive management structure.”
Of course, as a relatively nascent industry, there are dangers of a limited candidate pool. Ian notes in particular that there are fewer female applicants for risk assessment roles. “It’s challenging, but I’ve seen first-hand the benefits of hiring with diversity in mind. I recall going to visit one very traditional, and one very inclusive, neobank in the same day. Only after that did I realise the impact.”
Practising what you preach
Inclusive hiring practices may be one facet of company culture, but Ian advises that business values must be authentic. “I think culture is more important for those with larger aspirations – for example, if you’re building a Bitcoin platform and want to sell to investment banks.
“But you need to practise what you preach. There are socially aware platforms like bunq, whose USP is that they care about the world. They’re living and breathing those values – they’re paperless, and are committed to planting trees.”
Bringing it home
A notable shift in company culture is the unforeseen rise in remote working, which Ian says can only be a good thing for fintech recruitment.
“Working from anywhere gives you access to a bigger pool of talent. Coronavirus has moved us towards a flexible working environment far quicker than we could have anticipated. There’s no reason why all the full-stack developers should be in London.”
Moreover, these mobile working developments are making recruitment a more even playing field. “Recruitment has changed from a proprietary database of information – for example, one agency might have had the monopoly on ERP. Today, everybody has access to that talent: it’s called LinkedIn.”
Flexible working could also signal the end of long-term working contracts, as start-ups look to hire temporary contractors to aid growth. “The talent managers deploy an onsite agency model, develop the project, and move on to the next one.”
Tech as a recruitment asset
As more of us adjust to a working from home culture, Ian notes an upward trend in digital behavioural assessments. “Let’s say you need a project manager. You could ask them to record a four-minute dialogue about Agile – then they could describe what they do outside of work, which will determine if they’re a good cultural fit.”
Despite this, there appears to be coup against video interviewing – perhaps in response to the dreaded ‘Zoom fatigue’.
“I thought video interviewing would be picked up quicker. There are tech platforms like Odro and Hinterview, which record the process and self-delete for data protection. These could save so much time and money in travel.”
He speculates that interviewers may feel as though there’s a lost “human connection” with video interviews. “85 per cent of human communication is done via body language, but the benefits of video outweigh these minor drawbacks. How many times do we think ‘nice guy’ at the end of an interview, without any conclusive data?”
Why the right senior teams matter
Ian notes that we need to upskill senior executives to detect behavioural cues and become better assessors. While tech is a valuable asset, there’s no end to the value of the right team.
“Everyone should have independent non-executives, but they need to be right for the role, not just a beauty parade for regulators.”
The world of work may be changing, but we still need to focus on the fundamentals – recognising human talent and spotting opportunities.
“You need to choose people who will add value to your business, which is why it’s best to have a diverse range of ages and backgrounds. Non-executives have less experience, but executives might be waiting to retire. It’s all about finding the right balance of those hard-fought battle scars and new ideas.”
This interview with Ian Pope, written on behalf of Netsells, looks at the future of recruitment for fintech and neobanks.
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