Humble origins may make you a better start-up or fintech founder
If you want to start your own fintech, there are a number of distinguishing factors that might set you apart. At the LSE Alternative Investment Conference yesterday, Erik Serrano Berntsen, CEO of investment firm Stable, spoke to students about the traits and demographics that produce the best founders in financial services.
Background matters, but not how you might think.
Despite finance's "cliquey" connotations, humble backgrounds can produce great founders. Berntsen notes that 44% of US unicorn founders are not-US born, and that investment firms are more profitable on average when their founders come from lower income backgrounds. He notes that these people "just need to be better" than those that "have an uncle at Goldman Sachs to get you an internship." People founding far from their place of birth meanwhile "build businesses that deviate from consensus, they’re outsiders.
This doesn't mean having that Goldman uncle immediately spells doom. For example, Berntsen notes that a third of US presidents lost a parent by the age of 20. Adversity will always make you a better leader.
The best founders are kind and have attention to detail
Background isn't everything, you've got to be a good people person. Berntsen says the best founders are "great at hiring the right group of people," rather than intrinsically great investing or product. Especially early on, you need "someone there in the trenches with you helping you build the business.
You need to excel at hiring in "firm-ending" areas like risk, tax and audit, which could spell "game over" for you. Founders need an eye for "someone with great attention to detail who doesn’t think [those are] boring.
Ultimately, you need to be kind. Berntsen says, "I’d rather back an 8/10 investor who’s an 8/10 human" than a 10 investor and a 6 human. "I think the outcomes will be much better."
Risky ≠ Attractive
Investing and startups are often seen as risk-heavy industries, but demonstrating your temperament can be an advantage. Berntsen says, "don't shoot for triples, go for two points." Your failures will always be more visible than your successes, and "the best way to make money is to not lose money."
Eagerness can be a bad thing, especially if you want to parade an unfinished product. Berntsen says "The bar to look at something you’ve already looked at is higher than looking at something new
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