Thought Leaders in Financial Technology: NorthOne CEO Eytan Bensoussan (Part 2)

Sramana Mitra: First, what is your background?

Eytan Bensoussan: What I did prior to this was helpful, but they were adjacent. I studied Mathematics and Biochemistry. In the iterations of my career, I did a law and MBA program. Not connected to this thing, but they were iterative pieces. Then I spent six years at McKinsey, which gave me an eye-opening view. I was seeing what was happening in Europe and seeing the way that FinTech was emerging in the early 2010s. I combined that with this understanding of the problem from my childhood, I quit my job, and went to go work on it. I got started on NorthOne.

Sramana Mitra: When did you start NorthOne?

Eytan Bensoussan: The idea came to me sometime around 2013. That was the first time that this little thing started. It came to the point of obsessing over time. That’s when I knew that I had something. We started it in 2016. It was just me on a couch. It took a long time. I interviewed about a hundred possible customers before I even started. I interviewed a hundred business owners to immerse ourselves in the problems that they live in today.

I launched in 2019. It’s a timing thing. There was very little Banking-as-a-Service that allow FinTechs to power up in their markets. You needed to look for the diamonds in the rough of who could support a FinTech build on an existing bank. We’re not a chartered bank. We work with a partner behind the scenes that help us provide a lot of these financial services.

Sramana Mitra: That is one of my questions. To launch a bank, you need to be a certified financial institution.

Eytan Bensoussan: A lot of FinTech, especially in America, is built on these collaborative relationships where you have regulated institutions that provide a lot of that regulated product. The FinTechs take that and turn it into a utility service that they can bring to a customer base. Our use case is to take it for small businesses and become this back office for them.

Sramana Mitra: Who is your core banking partner?

Eytan Bensoussan: We work with The Bancorp. They’re one of the core banking partners in America. They’re critical and fantastic partners. Much of what we do is through that partnership. Behind every fintech is typically some very important partner.

Sramana Mitra: This is a workflow that I am familiar with. My whole life is about small business. We started One Million by One Million in 2010. I ran many startups. This is a very common scenario that you would encounter in a small business.

There is a bank account where all of the transactions are happening. There is a QuickBooks system. There is a bookkeeper who brings on all that data. Then maybe once a quarter, there’s an actual accountant who reconciles all that. At the end of the year, this accountant closes the book and does the tax filing. This is the life of a small business banking scenario.

Then there is all this other stuff like credit cards and debit cards. Potentially, there is credit. There is a whole range of FinTech companies that have come into that credit space like OnDeck. In a very small number of cases, there’s equity financing that requires a different workflow. The FinTech that plays in this space wants to integrate with the accounting software. Intuit provides that integration.

You want all of that to happen at the bank level. You want the small businesses to be your customers. You want to compete with Intuit. You don’t need Intuit in your workflow. You don’t need a bookkeeper because all the bookkeeping is happening automatically. I presume you’re integrating with other FinTechs that are going to provide the credit.

Eytan Bensoussan: Close. We work with all those tools. We integrate into QuickBooks. The idea is not to replace a tool that has a team of hundreds of people working on it all day long. We make a real-time connection with QuickBooks. You need a bookkeeper to do less and maybe different things. Part of what we try to do is make sure that that bookkeeper is working on the high-value unique things that only someone who lives in this business could know.

We’re automating things like having someone to download all your transactions and then upload them again. Part of what we bring to that is more than just the bank data. You’re bringing context. You’re bringing geolocation data. You can collate the receipts of invoices and push all those into the end-state account.

At the end of the month, they have a bank transaction. They got to bring it into QuickBooks. They’ve got to look at who spent this money, where they spent it, and where the invoice is. We try to bring all that busy work right to that last instance. Collecting the information, packaging it together, and getting it ready for closing is something we’re automating.

This segment is part 2 in the series : Thought Leaders in Financial Technology: NorthOne CEO Eytan Bensoussan
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