The biggest change, of course, is that about a year ago we were acquired by Spanish bank BBVA. Since the acquisition, we’ve grown quite a lot as a team. We were maybe 15-20 people, and now we’re something like 50 people.

In many ways, we continue to operate as an independent company as part of the BBVA portfolio. We have a bunch of high-level goals from BBVA, the main one being to bring new digital services to small businesses. But then it’s really up to us as a company how we execute those goals.

We’ve replaced the hassle and time consumption of multiple investors with one very deep-pocketed investor.

It’s been an interesting ride. With the BBVA acquisition and the growth of the team, we can now focus better. I’m now focusing on running our financial infrastructure team, made up of around ten people. We provide the core layer of payment processing: managing the customer accounts, doing customer identification, risk management. That core layer that, if we’re doing our jobs well, the customers won’t even know that we exist.

We see machine learning and AI as playing an invisible role in fintech services like ours. At Holvi, we try to automate the categorisation of income or expenses based on both the information that comes with each transaction and the customer’s past behaviour. This kind of automation is really part of the core promise we have for our entrepreneur customers: that you can focus on whatever you do best while we automate the routine bookkeeping tasks. But, again, that is hopefully something that the customers won’t even notice is happening.

“This kind of automation is really part of the core promise we have for our entrepreneur customers: that you can focus on whatever you do best while we automate the routine bookkeeping tasks.”

In the consumer space, we’re starting to see neobanks evolve. A great example is, of course, N26. Now these challengers to traditional banking have been around for a couple of years, they’re beginning to make an impact in markets. It will be exciting to see if we’re going to see consumer neobanks getting to really significant customer numbers. And, even more interestingly, how they will be able to monetise those services.

We’re also starting to see a few new entrants into the space where we are – that is, bank alternatives for small business customers. It’s beneficial to have more fintech companies in the scene. We’re not really competing with other fintech services, but against the old ways of doing things. People need to know that you don’t have to go to your local Sparkasse or traditional bank. As an entrepreneur, you can do your banking with an alternative service provider.

When you look at technology, the really big breakthroughs happen a short while after the hype cycle. If you look at the dot-com boom, everything was about e-commerce. Five years later you really started to see it hit the mainstream, along with the emergence of Napster and other services pushing boundaries. It was years before something like Spotify. I think fintech is following the same kind of path and hopefully, if the hype cycle is dying down, that means we’re getting closer to the mainstream. Which is probably a good thing. But once you get the mainstream customers your services really need to be fully stable. You have to have the trust of the customers.

A lot of that is because you’re dealing with customers’ money. Fintech companies, ourselves included, have been a little bit more careful about integration into other services compared to other sectors. But I think that’s now changing, especially with the open banking directive, PSD2, that’s coming into force in 2018, which will mean that all banks will need to open up their interfaces and APIs to developers. In the next two years, we’re going to see banking become way more integrated into other services, hopefully in the same way that other software services already exchange information.

“The next two years, we’re going to see banking become way more integrated into other services, hopefully in the same way that other software services already exchange information.”

At this point, it still has to be London. They are by far the fintech leader. Although, of course, there are very interesting things happening in Berlin, and Stockholm as well. There are a lot of new entrants in the neobanking scene coming out of Copenhagen too, and – although it’s often underrated – Paris.

Everything related to Brexit is going to shape things for a while to come. I think it was an unfortunate decision for the fintech industry, as well as for many other things. The UK has always been a little outside of the Franco-German core, and has been the liberal voice when it comes to financial regulation. The UK has been quite progressive, which pulls the rest of the EU along with it. Without that voice, it’s a loss on all sides. But we’ll see. At least it will bring something new to the fintech scene and allow new centres to emerge.

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