As part of my series about the “How to Navigate and Succeed in the Modern World of Finance”, I had the pleasure of interviewing Tucker Mathis.
Tucker Mathis connects the dots by pulling on 20 plus years of experience leading finance, technology and investment companies, including FINSYNC, TM Capital, Mortgage Technologies and The Heritage Group. He founded FINSYNC in 2011, on a mission to help businesses go from start-up to scale-up using one platform to centralize control of payments, process payroll, automate accounting and manage cash flow. When Tucker is not seeing around corners and imagining what is not yet there, he enjoys running, horseback riding and spending time with his family.
Thank you so much for your time! I know that you are a very busy person. Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I started a company, TM Capital, right out of college in the early 2000s that offered commercial real estate developers long-term fixed rate mortgages by partnering with institutional investors to fund their projects. This was before community and regional banks were offering long-term fixed rates, which helped this business take off. I parlayed that into starting another business, Premier Capital, to originate residential mortgages through banks and credit unions that didn’t have the people or technology to offer Fannie Mae loans in the branch. The combination of all these experiences led to the founding of FINSYNC in 2011 to help bankers offer businesses cash flow management solutions and accounting software through the branch.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
In retrospect, looking back, it’s almost comical how naive I was when setting out to impact a market as large and as fragmented as the cash flow management needs of businesses and how banks serve them. Sometimes it’s good to be naive so long as you are equally determined to learn and grow.
Are you working on any exciting new projects now? How do you think that will help people?
Yes! It’s trite but true that sometimes in business it’s not what you know but who you know. We are doing some cool things in concert with our bank partners to help businesses connect with all the right people at the right time. Think of starting a business, opening a checking account, but then needing some advice or coaching on additional action items to go from a business idea to building a successful business. We’re making that an in-platform experience and look forward to seeing the successful businesses that thrive as a result of this service.
Thank you for that. Let’s now shift to the central focus of our discussion. Extensive research suggests that “purpose driven businesses” are more successful in many areas. When your company started what was its WHY, its purpose?
FINSYNC was founded to empower bankers with the platform to help their business customers manage cash flow with less time and better results, and automate accounting so they can make better business decisions and more efficiently connect back to the bank for financing needs and goals.
Do you have a “number one principle” that guides you through the ups and downs of running a business?
Building a business is very challenging. You have to love what you do and find fulfillment in the life-changing impact you can have on others. A daily maxim is growth and comfort cannot coexist, and another, is when you stop learning, you start dying. So step into the challenges to keep growing and keep learning and you can get there.
If a fellow business leader would ask you for advice about whether to bootstrap or to look for VC capital, how would you help them weigh the pros and cons of that decision?
Start with the voice of the customer over that of a venture capital. Know your total addressable market and customer acquisition cost compared to the lifetime value of the customer relationship better than anyone. Therein will be the answer as to whether or not you will want or qualify for venture capital.
Less than 1% of companies qualify for venture capital because their total addressable market compared to lifetime-value is not large enough to cover the cost to acquire the customers and produce a risk-adjusted rate of return on invested capital bearing all the risk associated with product, marketing, execution, etc.
What measure do you use to determine the value of a company? What advice would you give to other leaders about how to get an optimal evaluation of their business?
Any for-profit company that has shareholders should measure the growth of the company as it relates to growth in earning per share. To get an optimal value, focus on the value you develop for all stakeholders, starting with customers, and building out from there. Focus on a strong defensible competitive advantage and the ability to predict market trends and shifts and show a history of getting ahead of these with a compounding return on invested capital.
What would you advise to a founder who initially went through years of successive growth, but has now reached a standstill. From your experience do you have any general advice about how to boost growth and “restart their engines”?
Zoom out. Look at all the pieces of the business relative to the market in its present and future state and reimagine ways to take the strengths of the business further, faster while repurposing the pieces of the business that may be a drag on the business.
What are the most common finance mistakes you have seen other businesses make? What should one keep in mind to avoid that?
Invest too much money in marketing before proving product-market-fit. When customers are recommending your product to others and driving organic growth, then it is time to turn on marketing.
Ok, here is the main question of our discussion. Based on your experience and success, what are the five most important things one should know in order to succeed in the modern finance industry?
- Develop a competitive advantage that’s beyond what problem you can solve with software alone.
– Solutions based on software alone will not survive long-term.
– You need to have some other network or go-to-market differentiation that has staying power, strong economies of scale.
– The cost to develop software solutions is on a very steep downward curve and I don’t see this stopping anytime soon, especially with what we are starting to see with AI. - Learn how to harness the power of AI.
– AI will be an integral part of any techstack moving forward. - Think platform development over point solutions, and be very careful if you build a point solution on top of an existing platform.
– The abundance of venture capital has given rise to a plethora of point solutions at a point in time where the biggest fintechs are evolving to become super apps or platforms where you can do increasingly more. - Don’t underestimate the amount of time and money you need to invest in managing risk.
– As technology advances, so do the methods and sophistication of financial crimes. In response, you have to be prepared to invest in risk management strategies that counter these attacks. - Get ready for regulation.
– If you are entering a segment of the finance market that touches payments, banking, lending or investing that doesn’t require regulatory approval prior to opening for business, consider yourself lucky from a “cost to enter the market” perspective. Take advantage of the window of time currently offered without such costs to ramp revenue enough to help afford those costs down the road.
– More and more fintechs are now being subject to regulatory review either directly or indirectly, through the financial institutions with whom they do business.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
Surround yourself with good people who share your vision for the value you are seeking to develop for others and yourself. Be sure everyone is motivated to finish what you started together. Treat yourself like a professional athlete. No one can win at the highest level playing extra innings day in and day out. Find a healthy work-life-harmony that allows you to play at the highest level when at work, but taking much needed rest when needed. Most importantly, love what you do and who you do it for and with, or don’t do it.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
To succeed in business more times than not it’s about who you know, not what you know. I would love to see a movement where more successful people offer up their time to help others succeed.
How can our readers further follow your work online?
To learn more about FINSYNC, our company’s latest news and the benefits we offer our partners, please visit https://www.finsync.com/resources/.