Anne Boden, Founder and CEO or Starling Bank, spoke at the Innovate Finance Global Summit, the flagship event of UK FinTech Week, where she discussed the challenger bank’s road to profitability and Starling’s aim to take a bigger chunk of the market
share.
Her key points included:
- Starling vs. competitor brands – “When we started Starling in 2014, we built the technology first, and then built the brand on top of that – and that allowed us to be profitable, unlike other [challenger banks], who developed a brand using
other people’s technology. We now have a really powerful technology stack, and our proposition is the be first organisation to provide technology others can plug into – and use our API to support their customer journey.
- “We see Starling as a global, technology company providing software as a service to US, Australian and European banks.
- On profitability – “We’ve been profitable for the past 18 months – we’ve grown and taken huge market share, but unlike some competitors, we’ve done that in a profitable way because we’ve focused on customers that actually generate income
for us in the long term. To give you an idea of market share – we have 3% of the retail market share, and 7% of SME lending.
- The role of VC capital in FinTech – “The challenge is that we have many fintechs that have grown accounts, but in the wrong sectors, needing to feed off more and more VC capital. As organisations move toward maturity, there is a limited time investors
give you to prove your business model. Starling has proven its business model, and it’s successful. The question is, how long will VCs give the industry as a whole to prove their business models.
- FinTechs taking a bigger market share – “The fintech sector has given the big banks a run for their money – and that’s good for the sector. The market will divide into two – those organisations that have a successful business model and those who
don’t. This is not a search engine, it’s not possible to have 80% or 90% of the market share. Starling will grow until it has the market share of an HSBC or Lloyds.