Ep. 141 - Plug In, Not Rip Out: Why Fintechs Don’t Need to Rebuild the Rails, with Moorwand

Liam Gray (0:05)

Hello and welcome. My name is Liam Gray, co-host of The Payments Shed Podcast, live from Fintech Meetup Europe in Lisbon. Today, I am joined by Luc Gueriane, CEO of Moorwand. Luc, welcome to the show.

Luc Gueriane (0:15)

Thank you very much, Liam.

Liam Gray (0:16)

It's great to have you here. So before we dive into it all, can you give a quick intro of Moorwand and yourself?

Luc Gueriane (0:22)

I'll try and keep it short, but yeah, Moorwand, I never know what the easiest term to describe it as is. Let's say we're an abler of fintechs, we're a new money institution, we have various card scheme memberships, we have various banking relationships, we are pretty agnostic in terms of other parts of the ecosystem that make up payments, and we support the fintech, the agent, the distributor, the whatever you want to call it, who is building out a sort of specific solution for their customer base based on their vision, and we sort of underpin a lot of the infrastructure that they'd be better off not spending time and effort and energy and money on, to focus on the bit that they really add value and have something unique. So, Enabler, Fintech agent support provider, yeah.

Liam Gray (1:19)

Perfect. And let's talk a little bit more about the Enabler part of it. And a lot of Fintechs move into the space, they feel like they need to build absolutely everything from scratch, the whole entire payment stack. Can you tell me a little bit more why they don't need to do that? Why sustainable Fintech actually doesn't need to replace that stack or build it themselves?

Luc Gueriane (1:39)

Well, I mean, it's part of my answer, I want to say. Sadly, some of them do.

And sadly, I don't think there's anyone out there that could sort of fully anticipate the bit that will be painful, that would have been the user case or the reason why they would have had to, yeah?

I'd also sort of say that no Fintech does because nobody builds a new bank clearing system, nobody builds it. So there's always going to be somewhere in the value chain that they will not bother doing. It's sort of unlike a rail company would not sort of rebuild sort of rail tracks and you wouldn't build a new airport if you're launching an airline. So the sort of bits that would inevitably be leaning on existing infrastructure, it's just the bits that are needed, the bits that are worthy of doing yourself, the bits that investors who aren't from the industry would force them almost because it feels like that vertical integration adds value to the valuation for the exit. And the sad thing is to say, to unravel each part of the ecosystem that makes up a solution, which bits are compatible with others, which bits are going to be locked in and when is it going to become a bit of a house of cards where that bit breaks and you're left with a whole solution instead of destroyed. So, I haven't answered your question, but hopefully, some of that waffle made sense to say, some of it is naivety, some of it is out of necessity to marry up. How are you going to achieve what you want to achieve with the right partners is pretty much impossible.

Liam Gray (3:23)

That does make sense to me and let's talk about those bits that make sense to focus on. So, what are they? If you couldn't pick out one or two, what are the parts that Fintechs should really focus on and not waste their time building? They should probably be working with a Moorwand in this world to build.

Luc Gueriane (3:44)

Each Fintech is probably going to have a proportion of the whole value chain that is going to be relevant to them, that's going to be specific and unique, that's going to drive that decision. So let's say a company that is really quite niche who is going to be sort of targeting a very specific customer group who needs to find the partners who are going to be supporting them in arguing the business case for, and it can be as innocuous as, I love the storyline of Sibstar where it's a product essentially much like a teen or a youth product, but it's for people with dementia where you have the complexities of who is a carer, who is exploiting, who is a, and who gives that person rights over somebody else's money. It's complex and I don't think any bank or any card scheme has anticipated in the rules that around that. So you need the partner who is going to lobby champion at the right level with the people who need to be able to support it. So from that point of view, that's probably an area.