Dirk Rudolf and Stefan Krautkrämer, the two Fintecsystems founders (from the left)
© Fintecsystems

Fintecsystems: The Hidden Champion of Fintech

As a fintech company, the Munich startup Fintecsystems supports banks and financial service providers in digitizing their processes. We spoke with the two founders about their startup’s success story.

Stefan Krautkrämer and Dirk Rudolf founded the infrastructure startup Fintecsystems (FTS) in 2014. The fintech company wants to help banks and financial service providers with digital processes. The founding team has unique expertise in the field. Together, the two founders already helped build the instant payment service ‘Sofortüberweisung’ and made it a leading online payment method in Europe. After selling ‘Sofort’ to Klarna for more than 100 million euros, the two members of the founding team exited in late 2014 and were ready to found another company. As experts in finance, they saw major potential in the new payment services directive PSD2, which would regulate and liberalize the payment market.

Dirk Rudolf, Fintecsystems co-founder, explained:

“The regulation promised interesting business models involving account information and payment initiation. That’s where we wanted to come in.”

How personal experience led to the idea

And that is exactly where the startup is now active with more than 60 employees from four locations. One thing Fintecsystems offers are online transfers in online shops. Another example in the area of account information and analysis are online loan applications. Anywhere where creditworthiness needs to be verified digitally and in real time, the solutions offered by the Munich-based fintech play a decisive role. So how did the two founders come up with the idea? As is so often the case, it was personal experience that led to it all, explained Dirk Rudolf:

“Because of the many test accounts that Stefan had opened as COO of Sofort, he had a bad score, which kept him from getting a Deutsche Bahn credit card. For me it was unfavorable conditions for getting a mortgage, which was presumably due to an older zero percent financing scheme.”

That meant neither of the two had perfect scores despite being solvent. Rudolf elaborated:

“Then we came up with the idea that there’s nothing better for determining current creditworthiness than a salary account. That made it clear: We’re going to offer credit assessment in real time for banks and financial service providers.”

A game changer for the industry

In contrast to data from credit agencies, account information is always up to date. Based on this first business case, the founders developed a range of additional products. And while there are several providers in the market, FTS has some unique selling points to show for itself, said Fintecsystems co-founder Stefan Krautkrämer:

“We can address 99.5 percent of banks with our API, that means approximately 6.000. Our categorization software, which clusters information, is the most powerful analysis software on the market with an accuracy of up to 98.5 percent in the most relevant categories. Today, we’re the leading open banking and analytics provider.”

Fintecsystems works for more than 160 companies, including banks such as Santander, DKB and N26 as well as all national comparison platforms, such as Check24. With DKB, one of the biggest German direct banks is offering a fully automated online loan. According to the founders, this is an absolute game changer.

Challenges on the road to success

The fintech startup has also encountered challenges on its road to success. There was the challenge of launching a product that can be used to evaluate one’s own ideas and visions of what one wants to present on the market, explained the founders. And when as a young company, you have banks as your customers who need help digitizing processes, you’re not dealing with the easiest target group. That means getting decisions made can often take a very long time – due to regulatory requirements alone, but also due to long phases of coordination between departments. This meant the startup battled with very long sales cycles, especially in the beginning, until finally closing a deal. Another challenge was putting the right team together, as Rudolf related:

“It takes years! And then that team needs to ideally stay together for a longer period of time. It’s basically like a soccer team: To get them ready for the championship, you need to have staying power.”

And the startup had that staying power. As a result, Fintecsystems is able to look back on positive business development, even after the corona year of crisis. Dirk Rudolf thinks:

“We can be very pleased with this year, which was such a surprise and made planning very difficult. We had a short corona dip in spring, but have benefitted as a whole from the fact that the demand for online services has been very high during the corona phase.”

Fintecsystems sees increased demand and doubled turnover

Regardless of whether it’s in eCommerce where the fintech offers payment services, or in financial services, such as the mentioned online loans or credit assessments, the demand is increasing everywhere.

“That means we’re growing faster than planned and were able to book nearly six million euros in turnover last year – which is double our turnover compared to 2019. For us as a growth company with more than 60 employees, that is a fantastic result,”

said Krautkrämer.

Despite all their success, the startup still sees itself as a hidden champion. That is partly due to their B2B focus, which means the startup tends to stay below the radar. But it’s also in B2B settings where extremely successful and sustainable business models develop, as Krautkrämer and Rudolf have already repeatedly demonstrated. Fintecsystems is currently working on a round of financing to further advance their growth.