Thought Leaders in Financial Technology: NorthOne CEO Eytan Bensoussan (Part 1)

FinTech companies are difficult to get off the ground. This case study is a deep dive into how Eytan managed to get to the seed funding round and marshal capital to go to the next level.

Sramana Mitra: Let’s start by introducing our audience to yourself as well as NorthOne.

Eytan Bensoussan: I am the Co-Founder and CEO of NorthOne. NorthOne is an American small-business-focused neobank. We serve small businesses across the country. In minutes, they can open up a government-insured business checking account. They’re able to move money by all the different money movement means.

At the very core, we offer operational banking. The mission and vision of NorthOne is building a finance department inside of every small business in America. Much of what we build on top of the bank accounts and the banking platform are parts of the back office that many small businesses need to be able to run their businesses.

In many ways, this is the idea of not making it exclusive. It’s an open banking concept. You can plug in tools that you use. The very idea that the bank is an organic piece of your business rather than some black box – this is what NorthOne does. We change the profile of small business ownership. If we do that, excellent social outcomes happen when small businesses succeed.

Sramana Mitra: Tell me a bit about the genesis of this business. What is your background that makes you interested in this?

Eytan Bensoussan: I grew up deep in the small business world. My parents, aunts and uncles, and grandparents came to America with very little. I had a great childhood because of what small businesses offered us. There’s a double-edged sword there. In many ways, the small business ran our family. My father is an engineer. My grandfather was an electrician. These are people who are experts in their domain.

When it came to running the book of the business, they’ve never been trained in it. No one put a finance course in engineering. Maybe recently, if you’re lucky. You could tell the pain and anxiety that they would go through trying to figure out how to close the books and make sure that everything is where it needs to be. I grew up with that. It stayed with me.

My uncle is a dentist. He should be thinking about better ways to improve the dental experience, but a lot of what he had to deal with was the finances of the dental practice. It’s only a privilege that, when you get large enough, you might have a finance department.

This is where NorthOne came to say that we can solve that problem if the bank, instead of just outputting a ledger, all it will give you is an amount, timestamp, and net balance. It’s the lowest common denominator from the source of truth. There’s no metadata. They just dump it. Imagine the average entrepreneur has to look at every transaction. Is it legitimate? Is it too high or too low? Where is the paper trail to make sure that we can close the loop? It’s no wonder why 80% of small businesses fail because of cash flow illiteracy and cash flow mismanagement.

That’s the kernel of the problem we’re solving. A small business should be able to do without that kind of pain. This is not a bad sales process. It’s just simply that the person didn’t have the right accounting education. NorthOne strives to make the relationship between the bank and the small businesses less of a utility but also think about where that data is going to be used in the back office. How can we prepare them to be finished? How can we get it 80% ready for your consumption as opposed to you having to do all the busy work?

This segment is part 1 in the series : Thought Leaders in Financial Technology: NorthOne CEO Eytan Bensoussan
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