Category: Partners

The Museum of American Finance is Coming to Boston

Posted on by Jim Smith

We had many distinguished, accomplished, fascinating speakers at Boston Fintech Week in September, but perhaps none attracted as much attention as Alexander Hamilton.

What’s that, you say?

One of our most popular participants was Alexander Hamilton, the “ten dollar founding father,” the first U.S. secretary of the treasury, and a leading proponent of a central banking system for the United States.

Through a collaboration between the Fidelity Center for Applied Technology (FCAT®) and the Museum of American Finance (MoAF), attendees of Boston Fintech Week had the opportunity to engage in conversation with Alexander Hamilton and ask him questions about U.S. financial history, his life, current events, and fintech.

A conversation between Sarah Biller, Co-Founder of Fintech Sandbox, and an intelligent avatar of Alexander Hamilton during Boston Fintech Week. 

This intelligent avatar of Hamilton is powered by generative AI. It’s much more than just a visual representation – it’s a subject matter expert capable of engaging in bi-directional conversation about U.S. financial history and current events. It demonstrates how AI can be used to create immersive and informative experiences.

AI Hamilton will be a permanent part at the Museum of American Finance, an affiliate of the Smithsonian Institution, when it opens in Boston’s Seaport District in 2026. The museum’s mission is to illuminate U.S. financial history and to make financial education accessible to all. The museum will also make space available for use by the community for public program.

David Cowen is the CEO & President of MoAF.

Q.  David, what kind of reaction did attendees have to Alexander Hamilton during Boston Fintech Week?

A.  Fintech Week attendees were amazed by their interactions with AI Alexander Hamilton. They asked him questions on a wide variety of topics related to finance, economics and history, and he provided thoughtful responses to each question. He even gave some insightful opinions on current topics, such as tariffs and taxes, and he replied in whatever language the question was asked. The most surprising moment came when an attendee asked him a question in Swahili, and he answered the question appropriately with perfect diction!

Q.  What can you tell us about your collaboration with FCAT?

A.  Our Museum has a strong relationship with the Fidelity Center for Applied Technology (FCAT) and a shared vision for moving forward. Our collective goal is nothing short of reimagining the field of financial literacy, given the incredible progress of technology and AI learning in the past few years. We are currently working with FCAT and their vendors to provide an incredible interactive visitor experience at our new exhibit headquarters on Commonwealth Pier in the Boston Seaport, where we will reach visitors in innovative ways on the topic of personal finance.

Q.  How was this intelligent avatar trained?

A.  The Alexander Hamilton avatar was trained through a proprietary model using a Large Language Model (LLM).

Q.  Why has the Museum of American Finance chosen to relocate to Boston?

A.  Our Museum had been looking for a new exhibit headquarters for the past few years, and we were very excited to learn about the opportunity available on the newly developed Commonwealth Pier. This location is an excellent fit for our Museum, as Boston and Massachusetts were the leading center of American financial innovation for two centuries, from the mid-1600s to the mid-1800s. Our plan is to build on that tradition at the Boston Seaport.

Q.  How will MoAF help visitors with the own financial lives?

A.  We have a 36-year track record of creating engaging, state-of-the-art exhibits, and we are dedicated to educating the public on finance and financial history through our financial literacy programs and public events. Our mission is to improve understanding of the influence of financial institutions and capital markets on the US and global economies, and on individuals’ lives. An affiliate of the Smithsonian Institution, we seek to empower individuals of all backgrounds to strive toward financial independence, while encouraging curiosity and discovery.

In Boston, all of our exhibits and programming will be offered free of charge— eliminating barriers to enter and learn. This includes a high-tech, interactive Personal Finance gallery, where visitors will explore topics such as budgeting, spending, saving and compounding. This will equip visitors with the tools and strategies to achieve and maintain healthy financial lives.

Q.  What can people learn from an exhibition of paper currency?

A.  We know that finance can be intimidating, so the topic of our first exhibit gallery will be something everyone knows well—money. Most Americans don’t realize that for a good part of our history, banks issued the currency, or that it was backed by gold and silver. These historical notes are often beautiful in design, and we let them speak for themselves as artwork. Multiple in-depth touch screens will allow visitors to interact with the notes and learn more about them. We will also display high denomination notes—like the $500 and $1,000 bills—which are no longer in circulation.

Q.  Which historical financial documents are in the MoAF collection? You brought one very interesting and important document to Boston Fintech Week.

A.  As part of our mission to preserve the history of finance in the United States, we actively collect important documents and artifacts related to the capital markets, money, banking and free enterprise. Our archive houses thousands of documents, currencies, photographs, periodicals and certificates, including the nation’s premier collection of 18th century US financial documents. We also collect artifacts relating to the financial markets—ranging from vintage stock tickers to Wall Street memorabilia.

The document you mention from Fintech Week was George Washington’s Treasury bonds, and there is a direct line from those bonds to today’s national debt!

Q.  The United States will celebrate its 250th birthday in 2026. What does the Museum have planned?

A.  We are planning to open in Boston in time for the nation’s 250th birthday celebration and the Tall Ships coming into Boston Harbor. One of our featured exhibits will be “A Financial Revolution,” on the origins of the financial markets, which were conceived and created by Alexander Hamilton and his contemporaries around the time of the nation’s founding. Plans are currently in development for our opening events. Information on the Boston project is available at www.moaf.org/Boston and will be updated as we get closer to the opening.

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The Fintech 5 with Kristen Castell — Managing Director of the Center for Accelerating Financial Equity (CAFE)

Posted on by Jim Smith

The Fintech 5 is a series of blog posts consisting of questions and answers designed to help you get to know the people in the Fintech Sandbox community.

Kristen Castell is the Managing Director of Delaware-based CAFE, a non-profit org with a flagship fintech accelerator program dedicated to improving financial outcomes for low- to moderate-income individuals. In this role, she has built an ecosystem of fintech founders, banks, investors, academia, industry leaders and a program to support the growth of extraordinary fintech companies.

CAFE is one of our Accelerator Partners and several Data Access Residents have participated in this accelerator program.

Kristen has a background as an executive at large financial services firms like JPMorgan and BlackRock, and also as a fintech entrepreneur. She is also a board member and advisor for many non-profit organizations and for-profit fintech companies, including the MicroDreams Foundation (microfinance) and Blended (co-parenting expenses fintech).

Kristen Castell Managing Director Center for Accelerating Financial Equity (CAFE)
Kristen Castell

#1. Kristen, tell us about your mission at CAFE.

We launched CAFE two years ago with a big vision and mission to be the “center for excellence” for the US in helping to grow mission-driven technologies that improve LMI (low-to-moderate income) people’s lives. Financial wellness is declining across the country for so many people – and by supporting even one company with new innovations in this area we can have a multiplier effect to help thousands and millions of people’s lives. I’m passionate about social impact and how we can bring all the players in the financial industry together, which is good for business, and also has a positive impact to make the system work better for all. CAFE was launched out of the Fintech Innovation Hub in Delaware and works across the US through offering our programs and working with the large community of partners we are building.

#2. What does the CAFE accelerator program offer and who is it designed for?

When CAFE launched, we created a unique accelerator program to help mission-driven fintech companies that have a product in market, some early financial institution customers, and are ready to scale. Our two month program is held twice a year for two months to support six companies at a time. This is an equity-free program that introduces the founders to relationships with investors, financial institution customers, academia, regulators and other industry leaders which is invaluable to their growth. Our next program has opened applications now (until Aug 15th) at www.ftcafe.org/apply and we also plan to launch additional programs and partnerships this Fall 2025.

#3. You moderated a panel for us at Boston Fintech Week in 2024 called “Why I’m Optimistic: What is on the horizon for technology & innovation in financial services.” How would you answer that question today?

This was one of my favorite panel discussions that I’ve led at any conference because of the spirit of the question being “optimistic” and focused on some of the exciting new innovations in the industry and things going right instead of all our concerns (also valid). In my role at CAFE, I get to work with so many people across the financial services industry in a variety of roles that care about our mission of technology + humanity and how we can build innovations that help people’s lives. I see how the fintech founders I work with are collaborative and support each other rather than competitive. It makes me optimistic that there are so many people that “care” and now using technology to create real solutions to problems and building a future that works better for people.

#4. If you could change one thing about the fintech ecosystem, what would it be?

The belief that making money and being focused on helping people is mutually exclusive. In fact, I believe the best way for a fintech or financial services organization to be successful is to focus on the long-term value for their people (employees, customers, suppliers, etc.) and then how that is financial material to long-term profitability. While CAFE is a nonprofit org, we are not a “charity” – when we work with large banks and other organizations we speak to the business contacts that are interested in the technology companies we work with because they could be additive to their business is servicing customers in new ways or obtaining new customers. We also work with the foundations and impact-focused groups that want a scalable way to have a positive impact on LMI people’s lives.

#5. What is the best career or life advice you have received?

“Ask for it.” When I worked at BlackRock, I volunteered as a leader of the Women’s Network and we created a program for employees (especially just starting their careers) on how important it is to ask for opportunities and how to do it. In corporate (and really in every aspect of life), it is important to share about what you are interested in and ask for what you want – so that way the other party has better clarity and can help you get there. It’s these little bold moves and asks that make a difference.

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Leading with a Data-First Mindset in Fintech: The Currency of Success in the Age of AI

Posted on by Jim Smith

By Darton Rose, Principal, Data Solutions, Wolf & Company

Darton Rose, Principal, Data Solutions at Wolf & Co.

Success depends on making the most of one of our most valuable assets: data. However, as we navigate the age of artificial intelligence (AI), data has become more than just an asset – it’s the currency of this new age, driving innovation, growth, and competitive advantage. Whether for fintech startups or established companies, embracing a data-first mindset is no longer optional – it’s essential for maintaining your competitive edge.

How Data Became the New Currency Within the Fintech Industry

In my view, fintech thrives on personalization, speed, and trust. Whether it’s seamless payment systems or AI-driven investment advice, every product or service relies on a deep understanding of customer behaviors, needs, and preferences. As a data science expert, I’ve seen firsthand how AI has amplified this dependence, enabling advanced analytics, predictive modeling, and automation.

These technologies have the potential to unlock new revenue streams, streamline operations, and deliver hyper-personalized customer experiences. But I firmly believe that this can only happen if the underlying data is accurate, accessible, and actionable. Without that foundation, even the most advanced technologies can’t deliver their full potential.

From my perspective, companies that invest in robust data strategies aren’t just responding to market trends – they’re future-proofing their business. Data empowers us as leaders to anticipate customer needs, spot market opportunities, and make decisions based on real insights. In today’s competitive landscape, those who fail to prioritize data risk falling behind their competitors who are more agile, informed, and prepared to adapt.

Invest in Customer Data for Significant Returns

In my experience, understanding every aspect of customer data is essential for driving growth and building loyalty in fintech. Yet, I’ve seen many organizations of all sizes struggle with fragmented data systems and siloed teams, leaving valuable insights untapped.

This is where data mapping becomes a game-changer. By identifying, categorizing, and linking all customer data points across the organization, data mapping creates a comprehensive, 360-degree view of the customer journey. Below are three use cases of how I see managers and executives using data today.

Optimize Customer Segmentation

When we organize data into meaningful segments, we gain a clearer understanding of customer behaviors and can tailor offerings more effectively. For instance, I’ve seen how a fintech startup offering personal loans can use segmentation to identify customers who would benefit most from premium credit products. This approach allows for targeted marketing campaigns that not only resonate with the right audience but also drive higher conversion rates.

The same data-first principles apply beyond core financial products, including digital services such as IPTV, where real-time analytics, user behavior data, and performance monitoring are essential to delivering reliable, personalized streaming experiences at scale.

Unlock Upselling Opportunities

I believe data mapping is also a powerful way to uncover patterns that reveal upselling opportunities. For example, clients using basic financial management tools might display behavior that signals they’re ready for more advanced investment products. With these insights, fintech companies can create personalized experiences that not only meet customer needs but also drive meaningful revenue growth.

Strengthen Compliance & Risk Management

In a heavily regulated industry, I’ve found that data mapping plays a crucial role in helping fintechs stay compliant. It ensures transparency and consistency in how data is collected, stored, and used. By taking a proactive approach to regulatory requirements, fintechs can not only avoid costly penalties but also build trust with both customers and regulators – a trust that’s vital in today’s business environment.

Data-First Leadership Turns Vision into Reality

Adopting a data-first mindset begins with leadership. At Wolf, where we work closely with fintech innovators, we’ve prioritized data strategy for decision-making. Therefore, as a data expert driving this transformation, I believe there are four key strategies that growth-focused fintechs should implement today.

1.      Build a Culture of Data-Driven Decision-Making

Fostering a culture where data drives every decision starts with empowering employees to use data effectively in their roles. This means investing in the right training and tools to build data literacy, ensuring that insights are not only accessible but actionable for everyone across the organization.

2.      Invest in Scalable Data Infrastructure

I always emphasize the importance of building systems that can handle growing volumes of data securely and efficiently. In my experience, a modern data stack with robust analytics capabilities isn’t just a nice-to-have – it’s the foundation for scaling AI and advanced machine learning initiatives effectively.

3.      Collaborate Across Teams

I’ve seen firsthand how data silos can stifle innovation. Breaking down these barriers and fostering collaboration between data scientists, product teams, and customer-facing departments is essential to fully harnessing the power of your data. When everyone works together, the opportunities for growth and transformation are limitless.

4.      Leverage AI for Continuous Improvement

In my experience, AI tools have transformed how organizations operate by enabling real-time monitoring of key performance indicators, automating routine tasks, and uncovering actionable insights with incredible speed. When paired with a strong data foundation, AI allows fintechs to shift their focus to delivering value where it truly matters most.

Win the Fintech Race by Investing in Data

In the age of AI, I’ve come to believe that data isn’t just a tool for decision-making – it’s the very foundation of innovation and the key to drive growth. I’ve seen our fintech clients who adopt a data-first mindset are not only better equipped to deliver personalized experiences and optimize operations, but also to stay ahead of the competition.

By embracing strategies like data mapping and customer segmentation, fintech companies like yours can transform data into a powerful engine for growth. The future belongs to organizations that view data not as a byproduct of their operations, but as their most critical asset – a currency that, when managed effectively, creates endless opportunities.

At Wolf Data Solutions, we partner with fintech companies to harness the full power of their data, driving strategic decisions and delivering measurable outcomes. If you’re ready to lead with a data-first mindset, I’d love to start the conversation.

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This guest post is provided by our friends at Wolf & Company, which provides industry-focused innovative public accounting, risk management, and consulting services to companies of all sizes. We are grateful to them for sharing their expertise. To learn more about Wolf & Company, please visit https://www.wolfandco.com/.

H1 2024 Wrap-Up Part 2

Posted on by Jim Smith

New Sponsors and Data Partners

Part 1 of our review of the first six months of 2024 covered the 19 startups we accepted for our Data Access Residency. And we hosted our 10th Demo Day in April, one of our two signature annual events. But we were also busy on other important fronts.

New Sponsors

We are very excited that two new sponsors joined the prestigious organizations contributing to our mission. Their generous support enables us to provide free access to data, services, a collaborative community, and a support system for early-stage fintech entrepreneurs. We are thrilled to have them working with us to further innovate in fintech. They are:

  • Global Atlantic, a leading insurance company meeting the retirement and life insurance needs of individuals and institutions. The Global Atlantic Foundation, which showcases its commitment to serving the community, and is a core part of the company’s culture and identity, provided a generous grant.
  • MCS Group, a relationship-focused consulting firm based in Boston. MCS specializes in working with fintech companies to create bespoke talent/hiring solutions for their IT teams, assisting companies ranging from startups to Fortune 500.

They joined existing sponsors Commonwealth, EY, F-Prime Capital, Fidelity Investments, Goodwin, MassMutual, Morrison Foerster, Rise, created by Barclays, and Slalom in helping startups and entrepreneurs build great products and companies.

New Data Partners

Thus far in 2024 we have welcomed three new data partners and expanded the datasets offered by a whopping seven of our long-time partners.

  • Kaleidoscope provides API access to a wide range of pre-defined and searchable securities datasets that have been extracted and aggregated from registered US and Canadian filings, including public companies, investment companies, funds, investment advisors, and US insiders. Just a few years ago, Kaleidoscope was a startup in our Data Access Residency!
  • ApeVue is a data services provider in the Private Equity / Venture Capital space. They provide the most actionable and timely market data and analytics on private company investments, including Pricing Data, Index and Benchmark Data, and Reference Datasets.
  • ATTOM is a leading curator of land, property, and real estate data, and provides premium property data to power products that improve transparency, innovation, efficiency, and disruption in a data-driven economy. ATTOM multi-sources various datasets for more than 155 million U.S. residential and commercial properties covering 99 percent of the nation’s population.

Existing Data Partners Benzinga, Dow Jones, FactSet, Moody’s, Nasdaq Data Link, Plaid, and S&P also made additional datasets available to our Data Access Residents.

If your company or foundation would like to discuss sponsorship opportunities, please reach out to us here. Fintech Sandbox is a 501(c)(3) organization committed to advancing financial innovation and reducing barriers for early-stage entrepreneurs by supporting the global fintech community.

And if your organization has data, and would like an efficient way to see what innovative fintech entrepreneurs can build with it, please reach out to us here. You’ll be fueling further advances in fintech while building relationships with impactful startups and entrepreneurs.

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The world needs FinTech like never before

Posted on by Jim Smith

A guest blog post from our friends at Rise, created by Barclays.

If you are an early-stage Climate FinTech founder, check out Rise Start-up Academy: Climate FinTech Edition.

Ever wondered how the fintech ecosystem can play a part in tackling climate change? A new report, Climate FinTech: An innovation thesis, from Rise, created by Barclays, highlights how one area of our industry could emerge to drive greater adoption of low-carbon solutions and technology.

That area is what Rise has identified as Climate FinTech. Climate FinTech describes organizations that build products leveraging a combination of climate, finance and technology solutions that support climate change mitigation and adaptation. Climate FinTech products can range from quantifying a carbon footprint to embedding financing within a climate solution. The companies innovating in this space are addressing the significant challenges faced by both consumers and businesses, who find that switching to low-carbon solutions can be painful due to adoption barriers that include upfront costs and technical complexity.

“Reaching at least 50% carbon reductions currently costs about $55,000 for a typical single-family home” — Research performed by the University of California, Berkeley

“US Department of Agriculture agency set aside nearly $3bn to give to farmers who cut emissions, but about $1.9bn spent on practices not doing that” — The Guardian

Climate FinTech can make that switch more affordable and simpler than it is today. Solutions can be grouped into three themes:

  • Carbon management drives understanding and enabling control of emissions. Fintech Example:

Persefoni, based in Arizona, have developed a climate management and accounting platform to support businesses and financial institutions in meeting climate disclosure requirements.

  • Direct mitigation facilitates the absolute reduction of user emissions. Fintech Example:

Banyan, based in California, helps finance sustainable projects such as solar, wind or other renewable energy initiatives by connecting banks, lenders and developers.

  • Climate risk management measures and mitigates exposure to climate risk. Fintech Example:

Agcor, based in California, uses data science and machine learning to support the agricultural economy with risk management and water intelligence.

According to our report, this sector is growing at speed with over $2.9B of investment in 2022 with Carbon Management related companies receiving the vast majority of investment. Direct Mitigation, however, received only 11% of total investment. Our analysis shows that Direct Mitigation could be the key area to unlock significant emissions reduction and commercial gain with the right support and financing compared to the other two themes.

Through our fintech focussed Rise, created by Barclays proposition, we provide Climate FinTechs with the tools to engage, network and experiment with the bank and other top innovators to support growth in this area. We offer:

  • Tailored accelerator programmes and physical workspaces to help Climate FinTechs grow and collaborate with each other.
  • Access to a global FinTech ecosystem made up of cutting-edge start-ups and scale-ups through our physical locations in New York and London, and our virtual community in India.
  • A capability allowing Barclays to engage and experiment with Climate FinTechs, helping to tackle clearly defined business cases using synthetic and public data.

If you are an early-stage Climate FinTech founder solving a problem across our three Climate FinTech thesis areas, check out our 10-week digital Rise Start-up Academy: Climate FinTech Edition. Across the programme, start-ups will fine-tune their product, get to grips with the foundations of pricing, understand how to increase sales and learn how to build out their team. As well as developing a repeatable and scalable business model.

Key Dates

  • Applications opened: 8th Feb
  • Applications close: 4th April
  • Programme starts: 22nd April

For more information and to apply — https://rise.barclays/rise-startup-academy-climatefintech-edition/

The Fintech 5 with Michael Haney — Head of Product Strategy at Galileo Financial Technologies

Posted on by Jim Smith

The Fintech 5 is a series of blog posts consisting of questions and answers designed to help you get to know the people in the Fintech Sandbox community.

Michael Haney heads product strategy for Galileo Financial Technologies. Galileo enables fintechs, banks, and both emerging and established brands to build differentiated financial solutions that deliver exceptional, customer-centric experiences.

Michael has spent his career at the intersection of technology and financial services, frequently driving digital transformation. Last fall, he was on the 2023 Boston Fintech Week stage as a participant in a panel called Laying the Foundation: Digital Infrastructure for Modern Banking.

Michael Haney — Head of Product Strategy at Galileo Financial Technologies
Michael Haney

Question #1: What fintech problem has your attention right now?

The Federal Reserve Bank analysis revealed that most consumers in the Millennial cohort have a high degree of interest in faster payments for both account-to-account (A2A) and consumer-to-business (C2B) scenarios, at 61% and 71% respectively. Two separate studies by Barlow Research Associates and Citizens Bank show that about 52% of businesses also indicate a high degree of interest in faster payments and expect about 22% of their outbound payments to faster payments. As of the third quarter of 2023, 461 financial institutions participate in The Clearing House’s RTP platform, and 331 participate in the Federal Reserve’s FedNow service. Here at Galileo Financial Technologies, we are meeting this growing demand by enhancing our money movement capabilities to support faster payments. Galileo clients of all types, including financial institutions, digital challengers, and even non-financial brands, can leverage this new capability.

#2: What trends in fintech are you most excited about?

(1) The rise of faster payments and its enablement of pay-by-bank services.

(2) The improvement of conversational banking by incorporating generative AI technologies.

(3) Better fraud prevention and detection through broad industry participation in data consortiums.

(4) Increased bank adoption of purchase finance solutions, such as BNPL.

(5) Bank workload migration to the cloud, including core processing.

#3: What are some of the biggest learnings from your career journey in fintech and/or entrepreneurship?

(1) There is no success in this industry without a deep understanding and appreciation for risk management and regulatory compliance.

(2) Surround yourself with colleagues who are smarter than you, complement your skill set, and are at least as equally passionate about the opportunity.

(3) Rebuilding the same capabilities on a modern technology stack is insufficient to succeed; you must offer something new.

(4) There is no straight path to success, but don’t let that detour you from achieving your goals.

(5) Start with a customer pain point or unexploited niche, then grow new offerings quickly and tangentially.

#4: Which fintech companies are you keeping an eye on right now?

Credit, used responsibly, has the power to enhance our lives greatly. However, traditional credit scoring limits individuals from accessing loans and increasingly impacts the ability to rent homes or gain employment. New credit scoring methods improve inclusivity and help create a more complete picture of existing clients already in the lending system. Emerging players for alternative credit scoring include Nova Credit, Zest AI, Altro and Pagaya.

#5: Hot take! What are your thoughts on AI in the industry?

Artificial Intelligence, or AI, is an umbrella term for several technologies that can work together or independently to increase automation, improve user engagement, or uncover insights. The three forms of AI penetrating the financial services industry the most are Robotic Process Automation (RPA), Machine Learning (ML), and Natural Language Processing (NLP). The application of these technologies is almost limitless, ranging from intelligent digital assistants and alternative credit scoring to personalized marketing offers. Financial institutions will improve productivity, increase efficiency, and shift work to more value-added tasks. These technologies continue to improve over time; for example, neural networks enhance ML, and generative AI enhances NLP. We have only begun to leverage the power of AI, and it will shape our industry for years to come. However, safeguards are required to ensure fairness, maintain resiliency, and improve confidence in the output of these solutions.

Bonus Question!

What’s the best career or life advice you’ve received?

Prioritize your health. Without it, you cannot achieve your professional ambitions, support your family, or enjoy your personal endeavors. Do what it takes to keep your energy levels high, your mood elevated, and your enthusiasm sustained.

If you are a fintech entrepreneur with an early-stage company and you could benefit from free access to data, cloud hosting, and a supportive community, please visit our website to learn more!

A Few Questions about Fundraising with Data Advocate Sarah Lamont

Posted on by Erin

Over the next few months, we’d like to introduce you to some of the sponsors, partners, advocates, and entrepreneurs who make up the unique Fintech Sandbox community, and without whom our small team could not provide fintech startups with access to critical data and resources, entirely for free.

First up is Sarah Lamont, a Data Advocate who helps us evaluate startups that have applied for admission to our Data Access Residency. Her day job is as an investor at Fintech Sandbox sponsor F-Prime Capital.

While most startups apply to Fintech Sandbox before speaking to venture capital firms, raising a seed or Series A is usually high on their list of things to do, so we thought we’d ask Sarah to provide some guidance that might be particularly helpful to first-time entrepreneurs who have not had to raise venture capital before.

sarah-lamont

Sarah, thanks for talking to us today. First off, can you tell us why you volunteer your time as a Data Advocate?

Financial data is expensive! i.e., cost-prohibitive for startups who are caught in the catch-22 of ‘need money for data, need data to build my product, need product to raise money’. So I volunteer time as a Data Advocate to help funnel early-stage companies into the Sandbox and get their product off the ground, and because it gives me the chance to meet entrepreneurs when they’re still in build-mode, outside of the fundraising context.

Can I ask a venture firm to sign an NDA before I send them my pitch deck?

It’s highly recommended to not do this (and doing so is a bit of a yellow flag). Investors may be reviewing hundreds or even thousands of pitch decks per year, and signing an NDA for each would be putting undue stress on their legal teams. Consider lighter weight options for staying in control of who sees your pitch deck e.g., email/password requirements or link expirations.

Who should pitch the company when meeting with a VC? Just the CEO? The whole founding team? Important team members who are non-founders?

There’s no hard and fast rule, but the first meeting should be 1-2 (co-)founders. Investors will want to meet the rest of senior leadership (e.g., product, marketing) at some point during the diligence process, but those meetings can be scheduled separately after a first few conversations.

Say we’re a B2B startup and several firms are already using our software. At what point in the process should I let a potential investor talk to my clients?

You want to be respectful of your customers’ time and ask for minimal favors, but also recognize that voice of the customer is one of the more important data points for early-stage investors. You should save the customer introductions until investors have given you the signal that they’re nearing the end of their diligence process and trending positively towards a term sheet.

How do you place a value on a startup that’s pre-revenue?

It’s a bit more art than science (and becomes more science than art in later stages). Most go the route of considering qualitative factors – like founding team, opportunity size, existence of early pilots – while also weighing quantitative considerations like expected exit value and return on investment.

Is there a danger you can over-inflate your seed stage valuation?

Yes. An over-inflated seed stage valuation puts you in a more difficult spot to raise funds at later stages, as investors will hesitate on price unless you have significant traction to justify the valuation.

When should I ask an investor for introductions to CEOs of their portfolio companies so I can do my own due diligence?

This is a great step to take during the diligence process. You should take this step when you’re nearing a term sheet, or when investors are asking for introductions to some of your most valuable customers (which, as mentioned previously, should also ideally be towards the end of the process).

If we pitched a venture fund that really liked us but decided to pass for whatever reason, should we ask them to introduce us to other VCs? Or will other VCs be less interested because the first VC passed?

Introductions to other VCs is one of the quicker-wins you can get out of VCs, and in most cases you can and should ask for them. If the pass is due to stage or sector, they can help you identify VCs whose fund mandate is more aligned to your company and get you a warm introduction.

Are there any other tips you’d like to pass to first-time founders on pitching a venture capital firm?

Investors will have varying preferences on whether they want to walk through a deck or keep it more conversational, Q&A style. Get a feel for that upfront and adjust the pitch accordingly.

As for landing a meeting, don’t feel compelled to meet every VC through a warm introduction. Cold outreach works – but do make sure the message is tailored to that investor or fund specifically. It doesn’t send a good signal when you send a seed-stage fintech deck to a growth-stage healthcare investor.