Podcast Interview - Dr. Tim Sievers, CEO and Founder of Deposit Solutions
The 6th in our special series of episodes that we're recording in partnership with the European PR Agency Tyto and their Own Without Borders podcast, was with Dr. Tim Sievers, CEO and Founder of Deposit Solutions, an open banking platform that reached unicorn status in September 2019 after securing a $55m investment for a 4.9% stake from Deutsche Bank.
the csuite podcast · Show 110 - Unicorn Interviews - Dr Tim Sievers - Deposit Solutions
The 6th in our special series of episodes that we're recording in partnership with the European PR Agency Tyto and their Own Without Borders podcast.
Dr. Tim Sievers, CEO and Founder of Deposit Solutions, an open banking platform that, as reported in the Financial Times, reached unicorn status in September 2019 after securing a $55m investment for a 4.9% stake from Deutsche Bank.
Brendon Craigie (top right) and Russell Goldsmith (top left) chat to Tim Sievers
For savers, deposits are an important product category for the financial services’ needs, that's just where you put your money, the excess cash that you want to save. For banks, it is a really important funding source, 40% of European banks balance sheets are funded in deposits. To Tim, open banking is about putting the customer at the centre of everything, the customer’s needs at the centre of everything.
Tim believes that becoming a Unicorn in many ways it didn't change the perception of the company much. However, he agreed that it may have brought them a little more attention.
He explained that building a company culture in such a fast moving and high growth environment is a challenge; the first thing is, you've got to make sure that you find the right people, eager to take responsibility - the sort of team building aspect of it, you've also got to make sure to unite them behind a common goal. That's really a communication challenge; to make sure everyone understands the vision so they can take the right decisions decentrally.
10 years ago, when he started the company, they spent about three or four years building the platform and then when Tim went to present it to the first partners, and tried to win them to participate, the distribution partners told him; look, come back when you've got products on the shelves. But the product providers told him; come back when you have distribution. So, there was the giant chicken and egg problem to solve. They then started their own B2C point of sale, their direct client facing business which runs under the brand of ZINSPILOT in Germany and Savedo in their international markets. With that, they distribute the products listed in their platform directly. Tim explained that this was really useful because it proved to other market participants that this works and it's feasible, the regulator is fine with it and customers want it. But it also meant that for product providers, he could say; look, here's the vision, we'll have lots of distribution for you but regardless of what happens, I have this channel here which works already, and I can get you deposits tomorrow.
What he finds interesting is that this is one area where it's the innovation is not happening in the US and then the rest of the world follows, there is exciting stuff being invented in Europe as well as in the States. In fact, there are quite a few European start-ups which are starting up businesses in the US now, Deposit Solutions is one of them, as much as the other way around.
Tim also added that their plans for launching in the US are going really well, they’re really far advanced as well. Unfortunately, this has been one of the projects that has been delayed by the Coronavirus crisis, it is a big challenge for them as a company. He said that, whilst they want to use their core strengths, the product market fit in Europe doesn’t always translate to the product market fit in the US.
Tim explained that Coronavirus has changed the way he communicates with his team a little bit. He said that sitting with the team helps because there is more informal communication that is happening all the time, but you have to have some sort of organised, centralised formats of communication on top of the informal things that are going on. They have also found that it is very useful to provide higher frequency of internal communication formats, like a newsletter, to still get across that you're part of one team, one community, even though everyone sitting at home.
Tim did acknowledge that they are in a fortunate position because they are not in trouble like other sectors. This year they are growing slower than they had planned to grow, but they will still grow.
For banks, deposits are really important as a funding source. Tim said they feel that demand from savers has not at all been going down with this decrease in rates over the past year, if anything, the problem of the saver has become bigger. He explained that it all comes back to deposit just being a very robust market, partly because it's so huge and partly because it's a default of what you do with your money.
In the first couple of years, Tim said he didn't spend much time on communications at all. He said they were very product focused and focused on building the team. It's probably something that with hindsight, he maybe could have started to do a little earlier. They did increase their attention to communications, firstly, by contributing to the debate around topics that are relevant to them.
Tim explained that to be a good spokesperson and representative of the business, you shouldn't be too loud, too early – that way you can build credibility. He said that communication has been a development for him, it is something you pick up with practice along the way, it also comes with a job on the interpersonal side. Deposit Solutions has an international team, of the 300 employees, there are 44 nationalities. So, when collaborating there are these cultural aspects on communication, too.
The coronavirus crisis has been the biggest challenge according to Tim, he said that you have to be straight and honest with the team and the people you're talking to. He explained that you should stay authentic. People notice when you're not authentic.
Tim believes that he should have started to contribute to the wider industry context around their expertise earlier as this is proven to be really effective for them.