What Fintech Entrepreneurs Can Learn From Big Tech Companies
You may have heard of a number of successful “big tech” execs leaving behind great jobs at companies like Apple and Google to develop a new passion project in fintech. The trajectory from big tech to fintech is becoming increasingly common. What makes for a successful transition and what can big tech folks take with them in their new ventures?
I chose this path, too. After co-creating what eventually became Google Analytics and spending nearly 10 years launching and growing new products as a Googler, I ventured out with a new business partner, Brew Johnson, and created PeerStreet, a platform for investing in debt. My exact path was uncertain, but I was lucky to have a very bright co-founder and an incredibly talented team at PeerStreet with a shared vision. The first two years held innumerable challenges, but also opportunities for growth. The journey forward hasn’t been written and we still have much to learn, but if I take a moment to reflect, there were a number of essential elements to making this a successful transition.
This is a lesson I learned repeatedly at Google. What you are trying to do as a company, and often as a team within a company, matters. It’s not simply having a mission, but having a mission that galvanizes others to action. Tech firms such as Google, Apple and Amazon are viewed as disruptors despite being enormous organizations. In part, that’s because they actually do disrupt major industries. But, it’s also because they continually project a vision that their employees, stakeholders and customers are drawn to. Having a strong mission when starting your business, even if you cannot immediately articulate it, is essential. It separates good ideas from great ideas and will help you recruit top-quality talent -- talent that feel as responsible for your vision as you do.
Leverage the "tech method."
A huge lesson I learned from my career is the benefit of building a platform that empowers an ecosystem. Think about Android, AirBnB or Amazon. If your business model is designed to benefit other participants in the ecosystem, rather than competing with them, it can have far-reaching impacts that turn an industry in your favor. If you can create a system that connects buyers, sellers, service-providers, etc., you have the ability to change how that industry functions.
At PeerStreet, we built a two-sided marketplace for private lenders and investors, providing proprietary tools for analytics and data that benefit the lenders, borrowers and ultimately, the housing communities where the loans are made. For you, it will be something else, but the more ways you can offer and compound benefits for others, the more powerful and long lasting your product or service has the opportunity to be.
Use your network.
Leverage your network in a way that also allows them to participate in your cause. The successful big tech to fintech pioneers do not view the companies they have left as something in the past, but rather an ongoing support group. And perhaps this is somewhat unique in the tech world, but enlightened companies have really embraced this employee movement. For example, there is the Xoogler community, a group of alumni and current Googlers who work together on startups, which even receives some support by Google. There is a huge appetite for new ideas and projects so don’t be afraid to ask for help, and use your network to help you at every step of the endeavor -- from advice, to investor introductions, to recruitment.
That goes for new parts of your network, too. I’ve written about how helpful Andreessen Horowitz has already been as an investor. That continued the other day when Matt Spence, former Deputy Assistant Secretary of Defense and Special Assistant to the President (he briefed President Barack Obama three times a week and was actually in the situation room when they got Osama Bin Laden -- seriously, just look at his resume), invited us to a small event with LA Mayor Eric Garcetti. Spence interviewed him on stage and very naturally weaved PeerStreet into the conversation. It elevated our presence in a room full of great companies and distinguished people. It doesn’t happen every day, but if you can get that kind of help, take it.
Because we’re creating something new, just about everything we’re doing requires looking at problems in a new light -- from our technology to how we use data and more. But, it's the marketing that can be especially tricky in a highly regulated space. How can you market a product you can’t talk about? We’ve learned to get creative. We do lots of things, but one amusing yet somehow successful example is taking pictures of people wearing our PeerStreet hats. Sounds kind of silly, I know, but it has really taken off. Oftentimes, the first thing people say when they visit our office is “Let’s take the hat pic!” It has generated some buzz, kept us top of mind and shows how thinking creatively can impact your business.
What started as a small idea with branded hats has garnered us a lot of attention, enough so that people come to our website to learn what we do and create an account to try it out. This feeds into my previous points about having a mission and leveraging your network. If people feel like you’re doing something important, they want to be a part of it. Encourage that!
When I left Google to co-found PeerStreet, I had a strong background in the tech industry, but very little professional experience in real estate, finance or law (especially the very nuanced areas required to flourish in this space). Instead of shying away from the knowledge gap, I’ve found that it has served me well. Let me explain: If you enter a new industry with fresh eyes, not only can you learn what you don’t know, but you can create completely new ways of doing things in the space. My co-founder is extremely experienced, and together we’re constantly exploring iterations and new ways to transform the real estate industry. There is never going to be a single playbook to building a successful startup, so the best thing you can do is put yourself in a position to keep learning. You’ll stay more engaged and be more open to changing how the industry works.
In many ways, the big tech to fintech movement is just another evolution in the tech industry spreading to all other industries, from healthcare to transportation to entertainment and beyond. The opportunity for technology to disrupt existing processes and systems is huge, and we’ll continue to see big tech firms act as incubators for entrepreneurs trained in technological problem solving and creative ideation, who then leave to effect change elsewhere.