Published on January 24, 2024

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This time last year seems like forever ago. At that time, we proclaimed that we had been “climbing the FinTech mountain” in 2022. While we got to the top of the mountain that was in front of us, and a lot of progress was made, there were definitely more mountains that needed our attention.

If I were to assign a “theme” to 2023 for Synctera, it would be “building for impact.” 

What I mean by that is, you can certainly spend most of your time as a company in our space building things that you think the market wants, that a bank might find useful, or a FinTech/brand would maybe integrate into their product. That’s a path, for sure. But at the end of the day, would that work be measurable by the impact that it had? Things like saved time, or more money made, or brand new things made possible? 

Sometimes, yes. A lot of times, no. And in some cases, maybe never. Welcome to #startuplife and building something out of nothing. It’s a sport, a game, an exploration, an exposition, but what it isn’t - is known and definitive. You have to experiment. Try things. Fail. Try again. And above all, stay resilient.

There’s a school of thought that this experiment, test, try, fit experience is only for when you’re starting out. I don’t agree. Even at Google or Uber we were trying to find what resonates - we had theories, we had more informed ideas, but ultimately, you had to build it, and see what happens. The more mature you are, perhaps the less crazy the unknowns are, but they stare at you every day. Challenging you to build something that will land with your customers. 

We talk about product market fit as the holy grail of building… I don’t know… I think both the market and the product are constantly evolving and adapting. You can’t just sit there and say “we did it” and think you have a company that lasts forever. That’s why we choose to build for impact.

I’m proud of 2023 and the journey we went on as a team, as an organization, and as a partner of our customers and our sponsor banks. It certainly hasn’t been easy and it’s been fascinating to watch our competition evolve too. 2023 was a crucible type of year. Surviving was a core goal and those that made it through are likely to succeed.

Let’s take a look back, shall we?

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This stuff is hard. Plain and simple.

How and what we build on the surface seems conceptually easy. In our industry the “API” is known, but the implementation is deceptively hard. Balancing both sides of our marketplaces’ needs - and then adding an ever present third-party - the regulators - has made for a remarkable set of challenges.

It turns out that moving money is really quite hard. It’s arguably harder to help the money sit still in a bank account. That’s why people mostly only talk about building these things themselves, but rarely do. When I led the Uber Money team, a lot of people told me that we were crazy for essentially building a bank within the company. In some markets we had no choice - we had to get an eMoney license in Europe, for example. That’s a story for another day, but it was crazy hard, and crazy fun.

Luckily, those learnings led to a big part of why we founded Synctera. We started Synctera to bottle the crazy and make it a solution for everyone else. You don’t have to do the heavy lifting - we did that. Now go get crazy about building fun things for your business. 

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Even more lessons were learned

2023 was a rough year for banking - and for us it was a reminder of why we never wanted to take shortcuts with our platform. It’s all a reminder of how essential it is to follow the money at all times and remember who and what ends up being impacted the most if things we build start failing. 

Here’s three key areas that stand out most to me when reflecting on last year:

• There’s only one way to build a platform like ours, and that’s the right way. Since you can’t have “banking-as-a-service” without a bank, it’s kind of impossible to think of a world where a bank isn’t your most valued and protected asset and a key partner in your pursuit of success. Focusing heavily on risk and compliance when bringing banks and companies together, in the way that we did, might have “slowed us down” in year one or two, but it was the right way to do it. We love to move fast, but we hate to break things.
• It was no secret that we had our eye on Canada from the very beginning. Our co-founder and CTO, Kris Hansen, has mentioned heading up to his native north every day that our platform has been live. For that reason, and many others, it was extremely rewarding to share with the world that we had taken investment in March led by a big six bank, National Bank of Canada, who would serve as our expansion partner in the region. Even more rewarding than that, just seven months later, we announced that our platform was officially live in Canada last December.
• From day one, the founding team knew we wanted Synctera to be diverse. And not just on paper. We needed everyone who touched anything at our company to have unique backgrounds, experiences, and perspectives. When you’re building products at scale, for customers you’ll never speak to directly, it’s essential. Being recognized by Parity.org for our efforts felt like we’re headed in the right direction. I personally believe that it’s a key reason why LinkedIn called us one of their top 50 startups of 2023.

We had to stay humble. Grow based on our own mission and keep our heads down - helping those that were navigating turbulent waters to do better and survive too.

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Product, product, product

We’ve tasked ourselves with building elegant, compliant, scalable solutions for functions that are in some cases, quite clunky and outdated. Both our community of banks and customers have a shared interest in innovation - it’s our job to provide them with the rails to do so.

I was Slacking with our co-founder and CPO Dominik Weisserth the other day and told him I was jotting down thoughts for this post. Naturally, I asked him what he was most proud of in 2023 on the product side. His answer was candid, and pretty amazing. He said:

“The biggest thing I’m proud of last year is that we didn’t f**k it up.” (Many of my current and former colleagues will know that “DFIU” is my operating mantra.)

I knew what he meant and gave my usual wink emoji reaction. But then he followed it up with this:

“We had 13 customers live in 2022, now we're at around 30, with quite a few in the pipeline. We kept our promises overall, and we delivered what we said we would. We have a platform that is increasingly scaling. We're still able to react to our customers in an appropriate amount of time to build what truly is missing.

And to me, I think what I'm really proud of is we proved as a company that we can sustain and that we can scale and that the things we build don’t break. We didn't have outages. We were up all year round, no matter what was thrown at us. That's real success. So since you asked me what I'm proud of, it’s exactly that.

We didn't f**k it up.

And winning a huge company like we did, getting them implemented, getting them happy, going through all of the due diligence that they went through. To me, that’s the success that I would say we had this year. In 2024, do I expect that we’ll be a bit more polished? Sure. But I think we did a great job, overall.”

I think we did a great job, too.

One interesting measurement pertaining to product momentum that I look at is “compared to 2022 and prior, what is the percentage of features and updates that were focused on one particular customer’s launch?” That number dropped significantly in 2023, which tells me that we’re headed in the right direction by building the right things. Everyone was benefiting from our roadmap expansion and customers were coming back to the “API Well” to get what’s next.

This is a complex set of things to plan and build, and it takes a lot of drive to know what to build and when. I know the most ambitious PMs and Engineers will always be thinking that they want to build it all by themselves. And for the best teams this is possibly attainable, but nothing beats transactional and operational experience. The API, the Code, and the Product are in some ways the “easiest” part. It’s the random wire that arrives encoded as a bank to bank transfer that can and does go wrong.

Some highlights of impactful things the product team shipped in 2023:

• Fully unleashed our lending capabilities thanks to customers going live with Synctera Smart Cards, which we originally announced in late 2022. All of the work that we did there set us up to facilitate credit transactions via Visa and Mastercard network, support credit account life cycle management, enable features like credit reporting and building with all 3 major Bureaus and earned wage access, which were just some of the things that our customers had an appetite for. We delivered in a big way.
• Strengthened Risk and Compliance by expanding our AML & Fraud compliance tooling to support Canadian programs.
• Simplified bank operations with enhanced reconciliation, automatic account sweeps to balance settlement accounts and end of day account balance reporting.
• Launched additional money movement capabilities to serve the diverse set of end customer needs: EFT came online in Canada, FedWire for high volume urgent transactions, remote deposit capture for business customers who get paid by check, cash deposits and cash orders to track merchant cash transactions, pull from card / push to card for instant money movement, and ATM cash advances using smart cards.
• Refined payment monitoring tools for better oversight, including ACH suspense monitoring, spend controls. 
• Support for international use cases by adding bulk card shipping and additional shipping methods, prepaid cards and area of use controls.

Still really want to build from scratch? Watch for our guide on that topic soon, you might want to wait until you give it a read before making any hasty decisions ;)

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Scaling all of the things

A quick way to show how we’ve grown and scaled is by sharing a slice of data that we obsess over. It has to do with something close to our heart, reconciliation and compliance. If you work in banking, or with a bank in any way, and are letting people move money, these things aren’t optional. It’s required to be compliant to be successful. And we pride ourselves on having a deep focus on getting it right - or at least as right as possible. (We still have a penny jar, yup, to handle FX rounding daily…)

First, let’s give this some context. Proper reconciliation means avoiding big problems down the road. It’s important to follow the money, and we’re pretty good at it. We grew the “$ Being Reconciled” by more than 50% to $120 BILLION in 2023.

We also work really hard to make reconciliation require as little manual work as possible. The proof of that is the improvement in our auto-reconciliation rate. It clocked in at over 95% for December, 2023 up 18 points from the same period in 2022. So, we’re growing platform traffic AND improving operational efficiency. In terms of human impact, that translates to productivity improving more than 5-fold for the people handling reconciliation.

Paul, a lead engineer on our reconciliation team, just published a handy article on the topic. You should give it a read.

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Great questions make great reporting

A core part of our strategy is equipping our customers to really take charge of, and evolve, their programs and businesses. A key to that? Data. Our banks and customers love Synctera Insights, our analytics platform. 

Last year was a leap forward for Insights, and with some enhancements and new additions, usage jumped. The number of users were up 6x thanks to a lot of new customers going live and more folks at each organization creating their own reports. Speaking of reports, the total number of reports our community created grew 25x last year. 

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Hand in hand

While shipping new products and features is fun and rewarding, we definitely shouldn’t be and can’t be building everything. That’s where our partners come into play. We’re extremely lucky to have some great companies working with us, like Socure, who helped us do watchlist monitoring in Canada.

We’ve brought on a few new partners that we can’t wait to talk about this year. On the risk side, it’s a company that helps out with monitoring marketing materials for our customers to keep them compliant. A big focus for us in 2023 and again in 2024, is bringing international money movement capabilities to our platform, which makes another new partner an indispensable part of our ecosystem.

And of course, we’re nothing without our bank partners and the customers that they take great pride in partnering with and working alongside on a daily basis. In 2023, not only did our number of customers increase (we more than doubled our launches!), but the different use cases and successes some enjoyed were truly inspiring. 

• We added Stearns Bank to our community of banks (and Midland States Bank came online officially).
• Mazlo readied itself for launch, which is a product that’s going to allow nonprofits to get off of the ground in a major way, saying this about their time working with us: “❤️ Heartfelt thanks to our design partners, learning allies, and Synctera, our wonderful technology collaborator, for helping us launch this FinTech innovation.”
• The amazing Firstcard team launched their product to help college students build better credit, which is something we’re thrilled to support. (They’re off to a great start this year, coming off of the Forbes Best Student Credit Cards feature for credit building and now the Benzinga award. Congrats again!)
• EXO Freight launched and they have one of my favorite use cases. They handle the shipping of oddly shaped items for companies like Walmart and Home Depot. Their invoice factoring product is a game changer for the space.
• We’ve also landed some other very big, and very interesting, new customers.

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2024 and beyond

What’s the theme for 2024? More of everything.

But mostly, since we’re bringing on bigger customers with more and more complex use cases, we have to ensure that we continue to be meticulous when it comes to platform performance.
The bigger the challenge, the more impact we can make. This year, we’re pushing the envelope. I’m personally looking forward to it and I know that our team is, too. I hope you follow along, there’s never a dull moment in our world…and we wouldn’t have it any other way. 

We have a lot of exciting things to share in Q1 and Q2 with a lot of progress to come in the latter part of the year that I’m looking forward to sharing with you this time next year.

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Tx

P

Ps. We have some pretty cool things planned for March’s Fintech Meetup in Las Vegas. Join us.