How 8 Fintech Companies Met the Challenges of an Economic Standstill

These fintech leaders share what they learned from operating in a pandemic economy, and how their organizations adapted.
Written by Remy Merritt
June 17, 2021Updated: July 23, 2021

In 2020, as businesses scrambled for loans and consumers struggled to maintain financial health, fintech companies faced a new sense of urgency. The unsteady economic climate brought changes across all corners of the industry; from consumer behavior and credit lending practices to wealth management and investors’ expectations for market data accessibility. 

The necessity of remote work and virtual interaction also laid a new path for the adoption of cloud-based solutions. This was particularly groundbreaking for larger organizations, for which concerns around security and operability kept them on-premises. For a cloud-based company like MayStreet, which integrates real-time capital markets data with companies’ existing workflows, the accelerated orientation toward the cloud was a valuable proving ground. 

“The pandemic helped many firms go from an aspirational cloud strategy to fully deployed cloud solutions,” Naftali Cohen, MayStreet’s chief revenue officer, said. 

Cohen wasn’t the only one identifying opportunities to innovate in a trying time. As part of an industry that changes rapidly, even in stable conditions, fintech companies are built on adaptability. Built In spoke with eight industry leaders to learn how the pandemic economy shifted their operations, and how each reorientation has informed future strategies.


Nicole Newlin
VP, Solutions

What changed for your business or industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

COVID-19 and the unprecedented 2020 economic shutdown presented challenging conditions. Small businesses needed emergency funds to stay afloat. When fintech lenders were authorized by the Small Business Administration (SBA) to originate Paycheck Protection Program (PPP) loans in the second wave of funding, several of Ocrolus’ lending partners acted quickly to build and activate complex lending programs in a matter of days, with the capacity to handle hundreds of thousands of applications. 

They were faced with several challenges, including helping small business customers secure access to PPP loans, building complex PPP underwriting infrastructure on a short timetable and eliminating administrative bottlenecks arising from manual document review.

Application processing speed was also of the essence, as Congress had allocated an additional $310 billion for a second wave of PPP loans. There was significant concern at the time that the bulk of that money had been earmarked for small businesses approved in the first round, but that were still waiting to receive funding. Fintech lenders had to be agile.


How did you adapt your product to address these shifting trends? 

While many lenders were ill-prepared to realign resources in a short timespan, Ocrolus supported several innovative lenders like Cross River Bank, helping them build a PPP lending program and proprietary onboarding system in just eight days. 

I’m proud of the team effort, particularly in a remote environment. Our account management and customer success teams spent countless hours supporting our partners, sharing their urgency to get funding to small businesses in need. 

As the PPP program winds down, we’re also proud of the impact we made in expediting access to PPP funds and saving millions of jobs. More than 2.5 million small businesses received PPP loans processed by Ocrolus lenders. We digitized and processed more than 12.8 million supporting documents, creating effective audit trails for loan forgiveness. Approximately 20% of PPP loans were documented on the Ocrolus platform.


Looking ahead, what lasting effects do you think 2020 will have on your business? How do you plan to be part of this next wave of fintech innovation?

We were able to help our lending clients optimize throughput speed without compromising accuracy, providing them with the documentation needed to deliver funding with accompanying audit trails. Delivering solutions to small businesses in a critical time of need is a core capability at Ocrolus. 

For example, one of the challenges of PPP was payroll data verification. One of our lending partners took the data extracted by Ocrolus and created an algorithm that cross-verified the borrower’s payroll deposits against the data extracted from their bank statements.

Long-term, the ability to convert documents into actionable data and provide cash flow analytics helps our lending partners drive customer satisfaction, loyalty and growth. The responsiveness honed in a crisis has meant that thousands of small businesses have developed new, trusted lending relationships with fintech lenders, and we become a technology pillar for these innovative lenders.


Don Nilsson
Chief Product Officer

What changed for your business and industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

2020 was obviously unprecedented. Out of necessity, the digital transformation in the wealth industry — which was well underway pre-pandemic — greatly accelerated when in-person advisor-investor contact was suspended. Addepar’s platform assists wealth managers in analyzing the performance of client portfolios, helping clients attain their financial goals. This became even more critical in the face of 2020’s historic market volatility. Active advisors on our platform were up 50% over the previous 12 months. Monthly analysis views increased 5x to over 1 million per month. Reports that our clients share with investors — as well as investors’ use of our portal and mobile apps — more than doubled over the past year. 

None of this is terribly surprising. A younger, more tech-savvy generation of clients has shown a growing preference for technology-based self-service experiences. 2020 put a spotlight on the importance and value of having a professional financial advisor. This fueled strong growth for our clients, who have looked to Addepar to help them scale and grow their businesses.


How did you adapt your product to address these shifting trends? 

Addepar is a cloud-based web application, so the sudden shift to remote work in 2020 was seamless for our users. We did, however, increase our investment in our portal and mobile applications, converging them for a more unified client experience. This included a highly responsive and adaptive portal application to support the various devices and form factors used by end-investors. We also made enhancements to ensure any portal view can be accessed in the mobile app.

We’ve long invested in our platform’s scale and performance. In 2020 we doubled down, given the sharp increase in users and usage. This resulted in improved system performance and enabled us to easily adjust to the increased demand.

With the growing emphasis on risk analysis and measurement, we developed a suite of new risk metrics that enable our users to better measure exposure in their portfolios. Lastly, the shift to a work-from-home environment fueled an expanding need for custom solutions. In response, we released our developer platform, which has seen high levels of adoption, as well as powerful new APIs that allow clients to tap into the full power of the Addepar data platform and calculation engine.


Looking ahead, what lasting effects do you think 2020 will have on your business and industry? 

The pandemic will certainly have far-reaching impacts on both the wealth management industry and Addepar. The associated market volatility rewrote the narrative around robo-advisors and the DIY approach. This should create strong tailwinds for the industry for years to come.

Today, our clients rely on us for data aggregation, analytics, reporting and client communication tools. We will continue to invest heavily in these core strengths, but that’s just the beginning. We’ve developed Addepar as an open platform, and this will continue to drive innovation. Our calculation engine and data platform is approaching $3 trillion in assets under management (AUM) — many creative ideas can be unlocked through this type of open platform with a powerful suite of APIs.


What changed for your business and industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

Traditional credit scores became less reliable in the COVID-19 economy, forcing mainstream banks to significantly scale back access to credit at a time when many people needed it most. In truth, today’s antiquated credit scoring system has been broken for a long time: missing many aspects of people’s finances; containing material errors for as many as 20% of reports; missing credit scores entirely for millions of Americans; and measuring the past, not the present. 

In a severe economic downturn like we saw in 2020, people’s financial situations can change dramatically in a matter of days. But the financial decisions they make now — good or bad — won’t show up on their credit reports for months. Lenders have no way of knowing how those applicants are doing financially, and that blind spot is what led to many banks to turn the credit spigot off.

During the crisis, we leveraged an alternative approach — cash flow scoring — to overcome the inherent limitations of credit scoring and help more people access credit in an environment where many banks and other lenders had disappeared. Our tool measures economic fundamentals such as income, spending and savings that aren’t typically considered in a credit approval decision. This helps more people qualify in a variety of economic conditions, and enables Petal to make credit accessible on terms tailored to each person’s unique financial situation.


How did you adapt your product to address these shifting trends?

Fortunately, we have been working on cash flow underwriting since 2016. One of the few silver linings of 2020 is that it provided a fruitful proving ground for our proprietary cash flow model. We took our 2020 results and parlayed them into a new, modern alternative to traditional credit scoring: Prism Data. Prism is the B2B version of our cash flow model, allowing traditional banks, fintechs, real estate firms, etc. to access our transaction intelligence platform for real-time credit decisioning. Prism provides additional insights in underwriting, income verification, personal financial management, fraud mitigation and more, enabling partners to serve more customers, build better products and make smarter decisions. And — perhaps most important to us — it can open up access to credit for millions of people who would otherwise be shut out.

In addition to Prism Data, in 2020, the launch of Petal 1 was an antidote to the mass tightening of credit across legacy banks. When big banks reduced credit availability, they did so largely by excluding consumers with low or no credit scores. Petal 1 was designed as a responsible option for this exact population, with competitive rates and no annual fee. It also features Leap, which currently gives Petal card members the ability to increase their credit limit. In the future, Petal 1 members will be able to upgrade their card by exhibiting healthy financial behaviors. 


Looking ahead, what lasting effects do you think 2020 will have on your business and industry? 

We’re excited to put 2020 and COVID-19 squarely in the rearview mirror, but not to forget its lessons. With an expanded set of product offerings, membership is growing faster than ever before, while keeping credit losses at all-time lows. But we learned in 2020 to never get comfortable, so we’re actively considering our next set of products and features to serve more members and help our existing members succeed financially. We are continuing to bolster our engineering, data science and machine learning teams.

Looking to the future, we expect that the collective financial experiences of 2020 will lead to a reckoning for traditional credit scores. President Biden has already called for the creation of a new public credit reporting agency, and the Federal Reserve recently cast doubt on the accuracy of traditional credit scores post-COVID-19. We believe that Prism Data could have a significant role in revolutionizing how credit decisions are made across the industry, broadly increasing access to credit. 


Tom Fortin
COO & Managing Partner

What changed for your business and industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

Two significant changes occurred for iCapital. First, firms focused on making their processes touchless and automated, eliminating paper from their customer interactions. Second, investors accelerated the shift to investing in private companies. Supporting both changes is at the heart of the iCapital platform, which is dedicated to making alternative investments available to high-net-worth investors while providing a technology platform to eliminate paper, spreadsheets and emails from the investment process.


How did you adapt your product to address these shifting trends? 

Since its founding, part of iCapital’s mission has been to create a paperless investment process. The old methods of alternative investing require paper for marketing materials, private placement memorandums, capital events, client statements, etc. A single investment might require hundreds, or in some cases thousands of physical sheets of paper. Multiply this by hundreds of clients, and the administrative costs are simply untenable for many advisors and smaller fund managers.

By providing advisors and investors with online marketing content, an electronic subscription process and digital access to investment documents, iCapital’s technology directly contributes to substantially reduced paper usage in our industry.

Over the last year, we’ve also invested in building electronic connectivity across the financial ecosystem via APIs or data files, enabling participants to efficiently, reliably and securely exchange data related to transactions and client holdings.


Looking ahead, what lasting effects do you think 2020 will have on your business and industry? 

As interest in alternative investments grows, advisors and investment managers will be looking for tools to educate and increase awareness of their impact in client portfolios. In addition, the industry is exploring better methods for integrating data and analytics into portfolio construction solutions that leverage alternatives. At iCapital, we believe a platform that includes integrated analytics, education, automation and client servicing will unlock the potential of this asset class and improve the outcomes of a client’s objectives.


Nick Themelis
Chief Information Officer

What changed for your business and industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

Everything changed for us. On a Friday in March, we were all working together in the office; that following Monday, everyone was working remotely. Job No. 1 is to always keep the business running, especially during a period where we saw threefold spikes in trading volume. These dramatic spikes were due to volatility in the bond market, which reflected what was happening in the world in general. We kept the system running with no issues.   

We also needed to stay on pace to deliver new technology. Our metrics show that we’ve become more productive during the pandemic than before. Lines of code committed, story points and features delivered have increased approximately 20% on average since we went remote. I used to believe that you had to have more in-person contact, but this data showed that we can operate effectively and more efficiently remotely. This conclusion has directly influenced our recruiting strategy — candidates have gained a lot of power and require the flexibility to work from other locations. We support that.


How did you adapt your product to address these shifting trends? 

A few years ago, we transitioned to a full Agile model. That has been a game changer for us. Our scrum teams gave autonomy to each business unit, enabling them to deliver at their own pace and priorities, and eliminating blockers. 

2020 has made it very clear to us that we need to accelerate our move to the cloud. We’ve already developed mission-critical applications on the cloud, and we’ve seen the benefits first hand. We want to be fully cloud-based, focusing on business functionality and innovation, and less so on infrastructure and support.   

We’ve been important to the market for years, and we’re now finding that we are a critical part of the infrastructure for trading corporate bonds. We take that responsibility — and its growth — very seriously. Electronic trading today comprises about 20-25% of the bond market. That’s still early innings. We’re confident we can more than double this, so we have a long runway ahead of us, and we are excited to take on the challenge.


Looking ahead, what lasting effects do you think 2020 will have on your business and industry? 

2020 has made it obvious that electronic trading is only going to accelerate in importance. Even the slower adopters, like the ones physically on the trading floor, are starting to see that the world is changing and they have to operate more electronically.  

Everyone at MarketAxess appreciates that we’re a tech company and that our technologists are the ones driving the business. They are the real rockstars, and while I’ve always known this, it feels good that everyone else has figured it out. 

Remote working for the technology group at MarketAxess is here to stay. This is how we’re going to operate. We learned a great lesson during this terrible pandemic, and it’s setting the tone going forward.


Naftali Cohen 
Chief Revenue Officer

What changed for your business and industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

The most visible change in our day-to-day operations was the shift to remote work. From virtual sales meetings to remote onboarding, we adjusted to the new normal and had a record year, growing both sales and staff.

Unlike other industries, financial services grew rapidly in terms of trading volumes and volatility, fueled by the rise of retail trading as well as pandemic and political news. This increased market data burdens for our customers. Peak volumes in 2019 led firms to upgrade their infrastructure, but even those were blown away by 2020 activity. For example, the Options Price Reporting Authority (OPRA) feed had an average daily peak message rate of 45 billion in 2019. That figure jumped to 82 billion in 2020; properly capturing it required approximately 30 tebibyte (TIB) of storage. Many firms have reached out to us looking to outsource data management to address capacity and other operational burdens. 

Another impact of 2020 was the focus on resilience and replacing legacy tech with lightweight solutions. The pandemic helped many firms go from an aspirational cloud strategy to fully deployed cloud solutions. We benefitted, as we offer fully hosted cloud-based products that were designed as large enterprise solutions.


How did you adapt your product to address these shifting trends? 

Greater demand for cloud migration and outsourced solutions only reinforced the product goals we set for 2020. We didn’t need to change product direction. Our real focus was on implementing the plan.  

To accomplish our product goals, we closed our Series A in June 2020, raising over $20 million. With an additional 30 new hires, we have been busy. We now have a “follow the sun” support team with staff in multiple, global locations. We launched a fully-hosted offering called the MayStreet Analytics Workbench, providing users with access to full order book data using modern tools like Jupyter notebooks and scripting languages like Python and R. Additionally, our MayStreet Data Lake includes over 150 venues, of which 45 were added in the last six months of 2020. We are at 15 petabytes and growing!


Looking ahead, what lasting effects do you think 2020 will have on your business and industry? 

We have embraced remote interaction and think it is here to stay. 2020 was an opportunity to bring on talented individuals across multiple geographies. That said, we are excited to welcome staff back to the office and plan to focus in-person interaction on collaboration and sales. 

We will continue to innovate by equipping leading banks and asset managers with resilient, flexible and extensible solutions. As we grow our product suite, we are focused on building scalable solutions for the highest-volume market days.

For years, banks and their leaders have expressed a belief that cloud solutions are the future, but their organizations hold off on pulling the trigger for various reasons. The current environment has been great, as it has made clear that you can have secure, reliable cloud solutions. Many of the objections related to security have been addressed. One of the reasons we’ve had success with enterprise solutions is that our offerings are modular, allowing us to help complex organizations pursue their long-term vision without disruption. We foresee significant adoption of cloud-based solutions and a growing demand for high-quality market data.  


What changed for your business and industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

The pandemic changed the collective consumer perception of what could be bought online. Since the inception of online shopping, considerable amounts of money and resources have been devoted to convincing consumers that they could buy products without ever trying them on or holding them in their hands. Incremental progress has been made on this front, pre-pandemic, but the last 15 months have absolutely opened the floodgates. The merchants we work with, in seemingly every vertical, have reported huge upswings in e-commerce activity. This fundamental change in consumer behavior has created outsized economic opportunities for the companies we work with and by extension for Clyde.


How did you adapt your product to address these shifting trends? 

To accurately track the ebbs and flows in consumer behavior, we’ve invested in our data science department. By creating a two-way data conversation with our merchants and our head of D.S., we’ve been able to provide insights into what drives consumers to purchase extended warranties and protection plans. Securing granular data, such as where and when consumers are clicking on prompts throughout their checkout process, allows us to accurately project the impact of UI and UX tweaks on a company’s website. This is particularly important because pre-pandemic consumer data is largely outdated. We can track and advise in real-time. In the past year, we’ve found the willingness of consumers to attach warranties and protection plans to their purchases has materially changed, and expanded to products that were not synonymous with protection plans.


Looking ahead, what lasting effects do you think 2020 will have on your business and industry?

The e-commerce boom of the last 15 months was really just an acceleration in the evolution of consumer spending. From a macro perspective, we’re not going to retreat back into pre-pandemic habits, by and large. For the warranty space, that means more and more companies and verticals now have the opportunity to integrate dynamic protection plans into their overall offerings. And for our business, that means more opportunities to drive revenue and collect data. I find the data component the most exciting because it can help us create positive outcomes for companies and consumers. You can’t innovate properly without understanding your audience, and we can help merchants we work with understand their customers’ behaviors by deciphering data. That’s where we differentiate ourselves in 2021 and beyond.


Taina Biggs
Sr. Director, Communications

What changed for your business and industry in 2020, and how much of that was driven by the pandemic and the impacts that had on consumer behavior?

Our mission at MANTL is to expand access to financial services, and we’re doing that by helping banks and credit unions modernize. The United States banking system has been held back by legacy infrastructure; MANTL believes that tackling that challenge will improve the banking experience for all.

Between shifting to remote work, the waves of PPP loans, and general market uncertainty, banks were overwhelmed operationally for much of 2020. Starting in mid-June, institutions seemed hyper-aware of the gaps in their tech stacks, and we saw demand for our digital account-opening solution grow significantly. 

Even before the pandemic, digital was becoming the primary channel used to spend and manage money. Today, the majority of bank accounts are opened online. Bankers are acknowledging that this is a lasting shift in customer preference and that a pleasing digital experience has become table stakes for meaningful growth.


How did you adapt your product to address these shifting trends?

For safety reasons, customers have mandated more self-service, particularly through digital channels. We have already enabled people to open a deposit account in less than three minutes, and consumer banking has seen tremendous innovation in the last decade. Unfortunately, the same isn’t true of the business banking experience, which is still largely paper-based. We spent 2020 reimagining the business account opening experience to bring greater convenience, time-saving automation and ease to businesses of all sizes.


Looking ahead, what lasting effects do you think 2020 will have on your business and industry?

Community banks and credit unions are starting to compete in the digital banking space, and consumers will ultimately benefit from this competition. One trend we’re helping these institutions prepare for is the shift toward real time. People expect instant gratification, and there’s added risk for institutions when they enable that.

Secondly, some pandemic relief efforts like overdraft forgiveness seem to be sticking around. Social sentiment around punitive fees is changing, and forward-thinking banks are reading the tea leaves. We’ve recently seen big banks like PNC and Ally announce that they are doing away with overdraft fees altogether. It will be interesting to see if this evolves from a differentiator to a best practice.

To keep up, MANTL is working to increase the range of products and services traditional banks offer online. We’re aiming to introduce new revenue streams that add value, improve financial wellness and provide greater convenience to the end-user. That way, banks can be less dependent on punitive fees to generate revenue and form more positive relationships with their customers.

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