How To Pitch To A Bank: Startup Edition

By Ratnam Tatavarty, Co-Founder and CTO, Context360 Published on Sep. 07, 2018

We are a five person mobile analytics startup and this is a piece inspired by an article by Neal Cross that discusses the process from the side of the banks. This article gives the perspective from the other side.

In the world of B2B business models, one of the intricate pairings is of a Startup and Banks. It is arguably the toughest and most time consuming. Tough, because the level of expectations of a bank are enormous. Time consuming, because the banks are hard to navigate. We are engaged with a major bank in the US and forging another with one in the UK. While we have long-term experience in doing business with big organizations, there are few unique things we learnt selling to Banks.

Most Risk Averse

Banking business is a relatively stable enterprise through calculated moves in enhancements and new product offerings. Quoting one of our team members, the Banks may ask: “Your new product may add us a few millions dollars in revenue but would it put our billions of dollars of business at risk?”. For example, if your product deals with users’ data or runs off of the Cloud, the bank may find it a very risky[1] proposition to let a startup do anything in that space.

Maze of Business Units

Compared to a fintech startup, all Banks are big, if not huge[2]. Banks are comprised of several business units. From the moment you engage with a bank, you will find yourself in a maze of business groups. Some of which are customers of other business units within the bank, which in turn might be at the mercy of a different business unit to approve the product or deployment. The key is to grasp the maze as clearly and quickly as possible. It means openly asking for their dependencies and the chain of command when you meet someone new. It will help in tuning the pitch and saving time. Oh, and like Neal Cross suggests — make the next appointment well in advance.

Ways to Ease In

Most, if not all, banks have a program in place to onboard startups. Typically, a ‘startup accelerator’ or ‘innovation group’ will evaluate and partner with small startups. This is a good stepping stone for startups as the people in these groups understand the organizational procedures needed to work with startups. They will eventually become your “fox”: the friendly who’s going to help you navigate the bank[3]. These groups also have a investment budget and approaching them for investment is a good alternative plan.

Operational Differences

Being a relatively slow mover in terms of technology, do not expect them to sport a Docker environment or a NoSQL key store in house. If your product or service needs are fairly new technologies, chances are the banks’ infrastructure may not support them yet. Bringing in new software/stack into a Bank is extremely hard as it is fraught with licenses, security validation, regulatory compliance, encryption standards and others. Each item in the list can take weeks to finish. So, take a note of the certified software components and make sure your product is flexible enough to work with them. As the Cloud is still a big ‘no-no’ for Banks, it is very important to get your software/hardware requirements verified as early as possible.

There are several other learnings about non-exclusive deals, international banking, digital-only banks and they deserve a separate piece for themselves. Hope this helps in your next bank visit, for a sale.


[1]: The number of data breaches in the banking sector is less than other sectors and accounted to 8.1% in 2014, denoting the risk averse approach employed. The key aspect to note in the ITRC report is that 14.5% of the reported breaches are attributed to sub-contracting.

[2]: The average size of a Community bank which falls under small bank category, is $280 million. During the period from 1984–2011, the number of banks with $25 million or less of holdings declined by 96% due to consolidation forced by powerful economic factors.

[3]: Quoting ‘Rule number 3’ from the referred article.

This article originally was posted on Ratnam Tatavarty's blog. Ratnam is the Co-Founder and CTO of Context360, a member of our Plug and Play Fintech accelerator program.

Disclaimer: These are my personal learnings and may not reflect the opinions of Context360 Inc., as a whole.