Last year, over $112 billion was invested in fintech businesses. This was a record year, and there are no signs that interest in the sector is going to wane. As new ways of banking emerge, alongside all of the tools needed to support these systems, the need for investment will be crucial.
But what makes an investment worthwhile?
Innovation was once king; especially for those looking to spearhead the revolution of new ways of doing things. But, will the next wave be built on businesses continuing to do things differently?
Or will it be built on those who do it best?
Trustpilot recently looked into what investors are looking for from fintechs, as well as what fintechs are doing to secure investment. What the research shows is that investors are no longer dazzled by just the latest innovations, they want to see true engagement with the consumers who are going to be using the service or product.
Being the best means more than being first
The research showed 83% believe that positive reviews and social proof are critical or important for generating interest from investors. This is not just a ‘nice to have’ endorsement, but a key foundation for any fintech business pitching for investment.
Further supporting this finding is the stat that around a fifth (21%) of those surveyed have been asked by investors to provide customer-centricity proof points such as ratings and reviews.
Investors are therefore not just content with groundbreaking technology, but want to see that a business is actively engaging with and asking for feedback from its customers.
This isn’t just a presentation slide stuffed full of 5-star reviews, far from it. It is a means by which to see that the company is listening, engaging and learning how to improve its business.
A good review can be 1 star
One of the biggest misconceptions that a business can make is that the only good review is a 5 star one. Of course, no investor is going to turn their nose up at a business with lots of positive reviews. But, what truly appeals is a business that engages with poor reviews in order to improve its core offering and services.
This was one of the key take-outs from the research, especially from a number of the investors taking part. Speaking about the role of online ratings, Roberto Napolitano, Marketing Director, Seedrs, said: “These ratings show potential investors that a company is interested in engaging with customers and improving on what they have to say; that they’re not solely about raising revenue. Ratings are a very powerful tool for investors to take the pulse of a potential investment to see if anything needs to be improved”.
Customer reviews drive innovation
Truly innovative businesses are not just trying to build the best technology, they are building the best relationships with their customers.
This is not a one-way street, but a desire to learn from both positive and negative reviews real experiences your customers are having with your service or product.
Innovation is important, but what’s the point in innovating if you’re not delivering on the needs and expectations of your customers? It’s something all businesses should be asking themselves every day - the best businesses are doing just that.
Alan is Vice President of Consumer Marketing at Trustpilot, a leading independent review platform - free and open to all. With more than 70 million reviews of over 300,000 companies, Trustpilot gives people a place to share and discover reviews of businesses, while giving every business the tools to turn consumer feedback into business results...