Root Causes of Struggles in
Executing Growth Strategies
The 2 Root Causes (+1)

The 2 Root Causes (+1)

Fintechs (both incumbent and emerging) often struggle to achieve 2-5X strategic growth. They have good growth strategies like offering new product, attacking new markets, or partnering with or acquiring another provider. So, they know what they want to achieve, but not how.

Some struggle with not hitting strategic milestones for quarters or longer. In their frustration, they often turn to risky tactics like ““…let’s go sell a few and we’ll figure out the solution later…”. The results of that can be disastrous which I describe here.

The fintech’s lack of progress in achieving stepwise growth is usually related to these root causes:

  • Too little focus on the buyer
  • Too much focus on the software

Too Little Focus on the Buyer

Fintechs may offer new product or enter new markets without a detailed enough understanding of the new buyers’ needs for the solution. In designing a compelling vendor solution, hundreds of detailed decisions need to be made, for example:

  • Should the solution include feature A or feature B?
  • What selling partnerships will maximize profit?
  • What is our commitment to our roadmap of innovations?
  • Do we need to offer 3-9’s of uptime or 4?
  • How do we onboard customers?

The fundamental answer to each of the hundreds of detailed solution-design decisions is “…it depends on who is buying the product and why…”.

In determining that answer, the right level of detail about the buyers’ needs is critical. Usually, the formulation of the strategy provides a few high-level market “care-about’s”. These are not deep enough for solution design. On the other hand, the fintech will often quickly develop buyer personas as part of its “sales enablement” activities. These will inform a portion of the sales tactics but are not broad enough to design a compelling solution.

What is required is a documented Buyer Needs analysis founded on the principle that “…it’s about them (the buyers), not about us (the fintech)…”. We’ll have more to say about how to conduct such an analysis in a subsequent post.

Too Much Focus on the Software

The second root cause of fintech’s poor execution of its growth strategies is that it designs its solution with too much focus on the software.

Most fintechs believe that the biggest source of value to its clients comes from its software (the “software-product”). However, most clients believe that there is just as much value from the rest of the fintech’s business model.

For instance, clients care about things beyond the software, like how a sale is made, the structure of the pricing, how they are onboarded, how product improvements are released, the operating risk of the fintech, and many, many more considerations.

We can relate to this as consumers by thinking about the things we care-about when we buy a phone in addition to the phone’s features, like the ease of buying the phone, the payment plan, the cover and screen protector, the insurance, the quality of the network, the apps, and many, many more considerations.

If the fintech can consider its solution to be all of the components of its business that go with the software, it can (1) increase the value of the solution and (2) create an advantage over competitors that may have great software but are just hard to do business-with.

This broader perspective on the sources of value delivered by the fintech’s solution – the software AND the rest of the customer-touching business model – can be referred to as the “whole-product”. In a subsequent post, we’ll describe the whole-product in more detail.

One More Source of Struggle to Execute Growth

There is one other consideration that causes frustration with growth execution: biases based on the fintech’s prior success. Simply put, when the fintech excels at offering its current product to its current market, it can become myopic in figuring out how to offer a new product or enter a new market.

As just two examples:

  • A fintech that has successfully provided an on-prem solution will struggle to design a hosted version of the solution because they just haven’t had to think about all that goes into providing and running the operating environment
  • A firm that has excelled at providing a custom solution to big buyers will battle culturally with the perspectives required to sell an out-of-the-box solution to smaller buyers.


There are methods, best practices, and tools to overcome these root causes. We’ll cover those in this blog soon.

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