FinTech Accelerator program gaining support from business and community leaders

by Andrew Moreau ([email protected]) 214 views 

Editor’s note: This is the final of four stories about the VC FinTech Accelerator program at the Little Rock-based Venture Center. Link here for the first story in the series, link here for the second, and link here for the third story.
Little Rock area business and civic leaders in recent years have sought new ways to lure businesses from around the country and globe to the region. It’s a roll-up-your-sleeves effort that has asked key business and community leaders to pitch in and lend their experience and skills to spur economic growth.

And the Financial Technology (FinTech) Accelerator program run by the Venture Center of Little Rock is the key rallying point for the effort. The Accelerator program is “completely focused on business development,” said Lee Watson, president & CEO of the Venture Center. “We help businesses execute so that they remain successful.”

Support from the Central Arkansas leadership community continues to grow as the 10 businesses in the Accelerator program near the end of the 12-week development process. The startups have roots across the globe, with offices ranging from India to Chicago, New York, Atlanta and North Little Rock.

Fidelity Information Services (FIS) made a major commitment early in the process to support the Accelerator program, buying into its commitment to identify startups with the greatest potential to deliver a viable and innovative product that could create business efficiencies. FIS, which has a large presence in Little Rock dating back to the start of Systematics in the late 1960s, has dedicated resources and leading executives to mentor the entrepreneurs in the FinTech Accelerator.

“It helps for us to get involved early in an energetic and dynamic process that could benefit our company, our customers and our employees,” said Chris Cline, senior vice president at FIS and a member of the Venture Center’s board of directors. “One of our corporate precepts is to be entrepreneurial driven and willing to take risks. With the Accelerator program, we’re getting a first-hand glance at companies working on FinTech solutions.”

In addition to FIS, the 10 companies in the Accelerator program benefit from relationships that have been developed with Little Rock-based Stephens Inc. and local banking executives. There also are contributions from a well-established entrepreneurial community in Little Rock that includes executives who led Arkansas Systems, Systematics and Alltel Information Services.

Those executives and bankers are part of a mentoring program that includes 56 business leaders in diverse industries such as manufacturing, software development, marketing and law among others. The mentors participate in a half-day program and commit at least four hours a month to coaching the Accelerator entrepreneurs. Many of the mentors dedicate more time.

“We have developed a world-class mentoring program to support these startups,” Watson said. “We were not focused on the number of mentors we attracted. We were focused on the quality of the mentors and we’ve been able to attract some of the best minds in Arkansas.”

More than half a dozen local banks have visited the Venture Center to meet with the entrepreneurs to lend advice on how the startups can meet the business needs of banks. The startups also have developed national relationships with potential investors. A recent speakers program was co-sponsored by the Chicago Mercantile Exchange, which is the world’s leading and most diverse derivatives marketplace offering futures and options products for risk management. FIS alone provides global access to 53 percent of the world’s banking technology.

Yogesh Pandit, founder and CEO of Hexanika, one of the Accelerator startups, praises the Venture Center leadership for their support and the access they have provided to FIS and to bankers who could use his product, which simplifies regulator compliance for banks.

“With FIS we have the best possible partnership in place,” said Pandit, who is one of several companies considering relocating to Little Rock. Hexanika is now based in New York City. “The support in Little Rock has been simply amazing. We want to make sure this partnership (with the Accelerator program) works well. The people who use FinTech are right here in Little Rock.”

Jim Koettig, founder and CEO of Public Funds Investment Tracking and Reporting (PFITR), has connected with state officials and met personally with Arkansas Treasurer Dennis Milligan about the potential use of PFITR’s product. PFITR has developed a program that allows public entities to track and price bonds to improve investment opportunities.

“It’s amazing to be in a meeting with the team here and have them send a text or an email and the next day you’re meeting with the state treasurer,” Koettig said. “There’s not only tremendous access to decision makers and to FIS, but in Arkansas there’s a warmth and a depth to the people that’s very attractive.”

Koettig also said he is considering a move to Little Rock from the company’s base in St. Louis.

Access and exposure to key players who could do business with the startups or invest in the companies has been key to the success of the FinTech Accelerator.

“One great thing about this program is it gives FIS and other businesses the opportunity to experiment with potential partners. Imagine how much it would cost FIS to invest in these kinds of technologies to determine if they would work. Here, they can find out what works and what doesn’t and align their resources accordingly,” said Gary Dowdy, managing director of the FinTech Accelerator.

The ability to drive across town to work with the entrepreneurs and help shape and mold their businesses is a definite advantage to FIS, Cline said.

“We have the opportunity to get more insight into these products and also to bring them to our customers,” Cline said. “There’s extreme interest in partnering with these companies. The FinTech community is enthusiastic and energetic and we’re always looking for innovations that could lead to our long-term success.”

Community bankers are equally interested, setting up meetings to coach the startups on how to pitch to banks and to help shape their products. Pete Yuan, president of the Arkansas region for Iberia Bank, helped set up a meeting between the entrepreneurs and local bankers.

“They were looking for some ways to get some doors open to the banking community,” Yuen said. “It was a platform for them to talk about their service offerings.”

Shelly Loftin, chief marketing officer for Bear State Bank, also has visited with some of the startups to talk about potential partnerships. Bear State, an FIS customer, is always looking for services that will differentiate them in the marketplace.

“We talk about what we look for in the community banking space and how they can polish their pitches to appeal to bankers,” Loftin said, noting the startups are flexible enough to build a business based on banking needs.

“Since they’re so small and looking for opportunities, they have the flexibility to change to meet a market need,” she said. “That’s what appeals to us. It’s more of a win-win than the traditional big-box vendor can provide. With them, it’s either take our product or don’t.”

Little Rock could be the center of the next generation of success in the financial technology industry, reminiscent of the explosion that began in the late ‘60s and led to entrepreneurial efforts and the thousands of jobs created by companies like Systematics and Arkansas Systems.

“This was a good opportunity for FIS to bring FinTech back home to where it all started with Systematics in 1968,” Cline said.