How Monite can turbo-charge your accounts
Hi Ivan! Tell us about Monite
By offering businesses the ability to embed finance automation into their platforms, Monite solves CFOs' headaches involved with manual accounting processes. Via a single API, any B2B platform — from marketplaces to neobanks — can quickly add invoicing, payables automation, or expense management workflows into their solutions.
Why does the finance world need that?
The major challenge we're aiming to solve is the lack of finance modernisation and automation. Looking at how most finance departments in most companies operate, the vast majority still rely heavily on email, PDF, and sometimes even paper. As a result, today, there are millions of hours wasted downloading, copying and modifying PDFs and other financial accounting admin chores. It’s not uncommon, even in otherwise hyper-modern companies, that someone will send a PDF invoice to another company via email, and the person receiving it will open the PDF, manually scan the relevant information, and put the figures into their own system by typing.
According to the recent FT Partners report, companies with significant automation can decrease their average invoice processing from 20.8 days down to 3.8 days, as well as vendor invoice error rates and invoice costs. Monite technology allows platforms to embed accounting tools quickly and cheaply. We use the power of APIs to provide a plug & play solution that is compliant across geographies. There is a massive duplication of work going on at companies building these unnecessary functions – and their quality is below par.
Where is the business today?
We launched our new API proposition in early 2022 and are currently preparing live with five high-profile customers while being in talks with over 100 more platforms across the US, UK, and EU.
What made you think there was money in this?
Before launching Monite, I managed Penta's growth, a key German B2B neo-bank, taking it from 0 to 20,000 clients. While working there, I realised that small businesses had much more difficulty with administration and accounting than banking. Monite not only offers these product solutions, but we're also able to help clients leverage these new capabilities and monetise interchange fees and more in the best possible way. Embedding these functionalities enables platforms to earn up to 10x MRR, 2-3x engagement and acquire users faster. These brands essentially get the revenue lines of successful vertical players (e.g. they get full functionality and revenue model of Melio Payments), but they don't have to build anything in-house and get the entire thing live in 3-5 weeks.
It seems Monite doesn't actually have direct competitors. EmbFin companies have so far focused on a distinct set of solutions that do not overlap with finance automation as embedded by our team. So we can say that we are the only ones providing finance automation that can support our clients to become genuinely complete B2B super-apps.
How have you shaped Monite's company culture?
Any company culture is believed to start with the way the founders think about things and the kind of people they recruit to the team. Fintech startups are not necessarily the right place for some newcomers. That’s why we have tried to assemble a solid and seasoned team from different areas of expertise. For example, we have recently been joined as head of the API by Alex Akimov, Ex-Adyen, as well as fintech and API professionals from Mambu, Fidel API and other big players. Though it's not standard for a seed-level startup, we invite mentors for every employee from the very beginning and get outstanding coaches for ourselves as founders. We believe in having fewer team members, but they will be the best in their field.
Monite corporate values are stated on our website. One of them is that we dream big and strive to have a large-scale impact on the industry. We never settle for average - not in our product, culture, or anything else. These are not just words to fill space. We've been working from day one to ensure these values are implemented. I can proudly say that there are no indifferent people on our team. That's why we can build things without having much capacity compared to the bigger players. So, we can do in 6 weeks what the market does in 6 months.
What is the secret to making the business work?
To make the business work, you must first articulate the mission and then be very flexible in implementing it. So, for example, we switched to paying customers, and it took an enormous effort to do the business and build the infrastructure. But this actually allows us to serve our purpose much better. The initial goal is essential, but you also have to consider the realities of the market. Secondly, it is all about people. You should find team members who know much more than you do as a founder. That way, you are more likely to come up with some innovation rather than something that will never see the light of day or just not have the proper traction.
And thirdly, you have to be prepared to invest for some time without seeing results. When a brilliant business idea pops into your head, you may think everything will fly like clockwork. But it's like with, for example, Mambu, who’s investors almost wrote off in the first few years. Now it is one of the most valuable companies in FinTech. So you have to persevere and give your startup time. It may take you months or even years to find real traction. Many success stories, especially in what we do in FinTech infrastructure, just need more time. And in this context, one of the main challenges for founders is to find the right investors who understand what you are doing and believe in the business. If it were not for excellent investors and advisers, AirBnB and Uber would never be what they are today.
How do you market the company?
Like many startups in the infrastructure space, we start with direct sales. Most of our funnel is organic or introduction-based. So, Monite began with natural early adopters who have more conscious needs. Our customer base is neobanks, legacy banks, FinTechs, and HR tech companies that want to add capabilities. We also focus on SMEs, which we see as vertically focused.
Now a proper sales function is being created, and it will be more outward-facing. There will be more of a push in that direction, so outbound sales will be more effective. As a next step, we plan to reach out to those whose needs are less conscious or may not even know they have those needs until we talk to them. So, we are expanding our segments and geography from the EU to the US, the UK and other regions. We’re going to kick off partner sales where we can co-sell with EmbFin/other providers to shorten each others' sales cycles. At the same time, we will deploy additional sales capacity to increase the adoption of those among our existing customers.
What funding do you have? Is it enough?
Monite has raised a total of €5.5 million in funding over two rounds to date. The last was in February 2022 with Point72 Ventures as a lead investor. The round also saw strategic participation from other fintech industry experts such as Victor Jacobsson, founder of Klarna; Adriaan Mol, founder of Mollie; Phil Valka, a senior executive at PayPal; Jason Pate, an executive at Plaid; Jonathan Weiner, a fintech investor and founder of Money2020; and Ralph Müller, Ex-Deutsche Bank Board Member and Oxygen investor. In the first round in March’22, our investors include Tomahawk VC, signals Venture Capital, InVentures and Runa Capital. The money we have raised so far is sufficient to realise our ambitious plans, but fundraising is also an ongoing part of the job.
Tell us about the business model
Monite's business model is a B2B2B that benefits from all the hard work that the neobanks and platforms have already done acquiring users. Conversely, these companies benefit from our investment in providing top-notch, embeddable service. We essentially sell the new revenue lines for platforms - they can earn from SaaS fees, payment processing, and upsell revenue share. Monite, in turn, earns on SaaS fees (allowing platforms to make a good margin), payment processing, and upsell revenue share.
What were you doing before?
I am one of those people who built their careers from scratch. As early as 16, I started working as a marketing consultant, earning a little money and a lot of invaluable experience. Then there was an unparalleled period of finding myself in Silicon Valley, USA, where I gained insight into running a business and startup culture. I was lucky enough to work with People.ai (funded by a16z), BrightEdge (D-series, profitable) and others. I can confidently say that my previous experience allowed me to create an innovative fintech solution that is now a game changer in the embedded finance market in Europe.
What is the future vision?
The emerging era of B2B super-apps will undoubtedly bring new opportunities for organisations, whether long-standing establishments or new challengers, to the market. And with the market being more competitive than ever, organisations are starting to work towards the super-app concept to provide more value to their customers. Yet to do that, it requires speed and, ultimately, branching out from core offerings. Fintechs like Revolut and Square are already doing this and are aiming to become one-stop shops where customers can carry out any transaction or service they are likely to need. And it is precisely here where embedded finance is stepping up. Cashflow is the lifeblood of those business customers, and automating financial processes can be a massive USP. And any platform with SME customers and a super app strategy in place should now consider how to offer best-in-class finance automation. There will still be giants, but now we can have B2B super apps for SMEs too.
Ivan Maryasin is CEO and Co-founder at Monite, responsible for driving product strategy, customer acquisition and business growth. He founded his first business at just 15. Peviously at Germany-based B2B neobank Penta; leadership intelligence with Bunch.ai; and customer revenue optimisation at people.ai, a Y-Combinator alumnus funded by a16z. Ivan received his Master's in Business from Hult International Business School, San Francisco, where he won the Hult Global Leader Scholarship.