Most fintech executives see themselves as competitors to large financial institutions, but not Max Eliscu, CEO of Viewpost, an Orlando, Florida-based startup (and a RocketSpace alum) that offers companies a platform to send and receive invoices and payments.
“A lot of fintech companies are beating up banks, but that is inconsistent with my experience," Eliscu says. “I think people running these companies are very smart and see that they can improve the customer experience."
Eliscu's company has just scored a major victory by adding Bank of America, the second largest bank in the U.S. in terms of assets, to its roster of banks that are connecting customers to its platform, which also includes U.S. Bankcorp and Fifth Third Bank.
Eliscu says Viewpost's partnership deal with B of A goes further than with the other banks, since B of A's 2.3 million small business customers will now be able to access Viewpost's network directly from their bank account online without having to sign up separately.
Viewpoint Poised to Disrupt B2B Invoicing
According to Eliscu, the process of sending invoices to customers and receiving payments is still done mostly by hand, a situation that made it ripe for digital intervention. Unlike Paypal, which mainly allows businesses to collect from consumer customers, Viewpost's network is B2B. Instead of charging a percentage of each transaction, as Paypal and Square do, Viewpost charges a flat 50 cent fee per transaction. Eliscu says the company was first conceived back in 2011 and started receiving its first customers in 2015.
Viewpoint may be a new entrant in the market, but Eliscu is no stranger to the industry. He set up an online invoice financing company, LSQ Funding in 1996, when he was only 25 years old. Invoice financing involves lending to companies using outstanding invoices as collateral for the loan amount so that companies can improve cash flow.
The invoice financing company gave him the opportunity to work with many of the same banks involved with Viewpost, which has received about $100 million in angel investments in three rounds. “We have a history of being able to understand what's needed and how to work with large financial institutions," Eliscu says.
How Viewpoint Snagged the Partnership
How did a company with only 97 employees go about reaching a partnership with a bank that has 150,000? “The process starts with finding an advocate, a sponsor in the bank who is trying to solve a problem," Eliscu says. “Advocacy occurs because someone in the bank sees the intersection between the goals they have and how your product or capabilities can help them accomplish those goals."
Eliscu and his team had to meet in person with many different B of A senior executives over the course of a year in order to clinch the deal. “We focused on the areas of the bank where we thought there would be the most immediate benefit and then found people in those areas of the bank and asked them if they agreed with us," Eliscu recalls. “We began the process of sharing with them how our solution could uniquely assist them in accomplishing that goal or achieving that strategy."
One initial decision made by Viewpoint helped swing B of A's approval: The company put a heavy emphasis on security and compliance so that financial institutions would feel comfortable with customers linking their bank accounts to the Viewpost network. This focus resulted in the company's second hire, Christopher Pierson, a cybersecurity expert who had been chief privacy officer for the Royal Bank of Scotland's U.S. banking operations.
Staking Out an Independent Position
Many fintech companies worry about large institutions seeing the benefit of their creation and just taking the idea for themselves. Eliscu says Viewpost doesn't share that concern. “If you want to create a network, it really has to be agnostic of who you bank with. Not everyone is going to bank with a single entity," he says. To maintain its independence, Viewpost did not solicit investments from major banks.
Other startups can follow Viewpoint's example of solving problems for bigger players in their industry. “If you can find inefficiencies in a market, whether that is a function of technology or process or regulation, then there is an opportunity for some period of time to create growth opportunities by doing away with those inefficiencies," Eliscu says. “It's what makes everyone better."