Three ways to support fintech founders
Get used to disruption
It’s not the first time the finance sector has faced a tech explosion. “Banks were the very first fintechs. We used to have bank books, the banks did more to take us to the digital age than almost anyone. They had to build those digital systems from scratch — before Google or any of the easy digital frameworks existed — and I admire them for it.”
Know when to push back
“There’s always one in the company who’s adamant about a really spicy topic.
A great board member can bring up those topics and allow debate from both sides. At the end of the day, when the decision is made to commit, the people who disagree need to sit back and let it go. I know it can be hard to back a call you didn’t want to make.”
Boards can provide the framework, but should allow fintech leaders to take risks
“The worst thing is to remove all the risk from a company. You’ll be left with a beta company, like all the others in the industry. An industry is a whole group of companies doing the same thing — that’s not innovation.”
Fred Schebesta is celebrated in some entrepreneurial circles for his mould-breaking approach to achieving success. He is co-founder of independent comparison website Finder (finder.com.au), which now serves more than two million people every month, helping them make decisions about thousands of products ranging from credit cards and home loans to streaming services. Finder earns income through display advertising and promotional content. While it does make some money from referral fees, this only happens after the customer makes a choice.
The 2019 Australian Financial Review Young Rich lister admits that, in his youth, his disruptive approach frequently got him into trouble. He says he was a difficult student to teach because if he didn’t care about what was taught, he didn’t put his mind to the work. But if he felt passionate about a subject (business) or an activity (tennis and chess) he could also be contrarily competitive, often to his parents’ bemusement.
“My parents are both doctors,” he says. “They’re extraordinarily intelligent, capable and high-achieving individuals. When you’re a kid and you want to challenge what’s out there, it’s hard when your parents are so smart and creative. Over a long period of trying to intellectually jazz with my parents, I developed this idea I could win by doing things differently. So, I’d move the conversation off the beaten path and only then was I on equal footing to compete and win.”
It’s a mindset exemplified in Apple’s “Think Different” advertising campaign of 1997 (Schebesta’s penultimate year of high school), in which the tech company lauds “...the crazy ones, the misfits, the rebels, the troublemakers... because the ones who are crazy enough to think they can change the world are the ones who do”.
It can come across as a provocative mentality, acknowledges Schebesta, but it worked for him and many other entrepreneurs who have successfully taken on well-established industries and won.
“We have a cultural problem in Australia where people are pulled down, like lobsters are in a tank, whenever someone takes risks,” he says. “Worse, when someone is successful and climbs out. I don’t understand that culture. It’s just not conducive to innovation.”
“You’re not really committed if you’re not prepared to burn out chasing success.”- Fred Schebesta
Cultivating an entrepreneurial attitude
Graduating from high school with “an average” HSC result, Schebesta’s academic performance during his first year at Macquarie University in Sydney wasn’t much better. He was more excited about what was happening on the internet in 1999 than what he was meant to be learning by attending lectures.
While most of his peers enjoyed the typical student life of parties interrupted by study and cramming, Schebesta stayed up late most nights in his dorm room teaching himself web design and online business strategy. He switched course from actuarial studies and computer science to study for a Bachelor of Finance and began making money on the side building websites.
The dot-com boom hadn’t yet captured his peers’ imaginations, but Schebesta found a fellow traveller in Frank Restuccia, an old school friend from Sydney Grammar. Restuccia quit his job as an investment accountant at BNP Paribas so the pair could launch a digital marketing agency, Freestyle Media, in 2002.
In 2006, they put all the digital smarts their clients rated into building Finder.
“The big difference between Finder and many comparison sites is that it’s run by independent experts with more than a decade’s experience,” says Schebesta. “We’re not owned by an insurance company or bank. It’s got to be independent so people can make better choices. Our first leadership principle is to be obsessed about what the customer wants. So we curate their experience from the finish (making the choice) to the start (finding information).”
Rebuilding the business
Schebesta believes founders are more obsessed with customers than their corporate competitors because they want to build a legacy. Founders aren’t looking for the next bonus, they’re driven to keep on winning with their big ideas. “Chart founder-run businesses on the ASX versus those run by corporate professionals,” he says. “Which businesses win because they care about their customers more?”
Still, Schebesta had to relearn the lesson in 2016, when the business had grown to a point that he’d effectively replaced himself in every role. And Finder was eyeing off opportunities in the US.
“When a company outgrows you, most founders go sit on the beach or find something else,” he says. “But it was a dark time for me until I realised my calling — I’m great at going from zero to one.”
So when Schebesta joined the team in the US, it wasn’t to recreate the Australian company. He told them they had to think like a brand-new startup again. “We had to put a lot of energy into understanding the new customer, zooming in on how we could help them better. I always yearn for those opportunities.”
In April 2021, Finder further extended its reach by acquiring Singapore- based financial services and data platform GoBear, which, like Finder, aims to improve people’s financial literacy and help them choose better deals.
Coming up, Finder intends to offer a one-swipe cryptocurrency trading feature, which Schebesta hopes will encourage more people to get into a market he’s been enthusiastically investing in for several years.
“It was a dark time for me until I realised my calling — I’m great at going from zero to one.” Fred Schebesta
Removing the friction in fintech
True to its mission, in March 2020, Finder launched a mobile app designed to make it easier for customers to act on their choices. It includes a one-click feature to help people switch products for a better deal, which Schebesta says solves a problem customers had with bank websites.
“We’d see people wanting to switch and when they left Finder, about 50–70 per cent would drop off before completion because it was too hard to do it with the banks on mobile,” he says. “So we removed that friction.”
While Schebesta welcomed the new credit reporting laws, which he says will help customers access better deals (Finder now offers a free service so people can check their rating), he’d like to see better government support for fast-growth tech companies. He says the labour laws make it risky for businesses to test new talent. At the other end of the spectrum, when employees succeed and receive shares as a reward, he believes the taxes are “insane”.
“Founders who want to sell part of their own shares are also hit with extreme reporting,” he adds. “Everyone is scared to do anything with all this disclosure in Australia, so they move their companies offshore. Our laws aren’t set up for innovative entrepreneurs to want to base themselves in Australia.
Sometimes, his obsession with innovation, particularly with what the customer wants, causes Schebesta to live a “lion’s lifestyle”. Although, acknowledging executives should be mindful of their personal wellbeing, his own work ethic embraces intensity to the point of exhaustion.
“You’re not really committed if you’re not prepared to burn out chasing success,” he says. “It’s a tactic for me. But the reason so many great things happen around me, even when I’m exhausted, is because great people choose to support and work with me. I set an extremely ambitious vision and ruthlessly high standards, but I also give people a lot of autonomy. A lot of people find purpose by winning.”