Last week, it was announced that Maxfield Capital (and others) had invested in the Finnish fintech startup MONI. Maxfield have been in touch with me for some time expressing their interest in the Nordic scene, and now they’ve officially made their first investment, I caught up with Alexander Turkot, Founder and General Partner at the firm to find out more about MONI, their intentions for more investments in the Nordics and of course our customary four questions we put to every VC we speak with.
Neil Murray (NM) : Let’s begin with MONI, What can you tell me about your investment there?
Alexander Turkot (AT): MONI Ltd is a next-generation financial services provider with a presence in Helsinki and London. Their main offering is a convenient way to pay and track your spending just about anywhere, with transactions being processed by Mastercard network. A MONI card essentially functions as a pre-paid Mastercard credit and debit card combination.
We’re excited about MONI because we see it as the future of consumer-driven finance. MONI’s seed round of investment yielded $1.45M, with participation not just from Maxfield Capital, but also Formation 8, the Digital Currency Group, and private investors from Europe, USA, and Brazil.
What’s especially interesting is that MONI features a technology specifically designed for refugee payment services which was developed to help the underbanked get access to financial services. They are also currently in negotiations with Brazil to deploy their service for the underbanked population there.
NM: What are your intentions for the Nordics?
AT: More than 50% of Maxfield’s investments are sourced from Europe. This makes sense for us because Europe has a number of start-up hubs such as the UK, Germany, and the Nordics. We view the Nordic countries as particularly important because the region is one of the most successful places for tech companies. A number of well-known companies from this region have gained impressive traction.
Another factor that keeps Maxfield Capital focused on the Nordics is that our investing is primarily centered on B2B start-ups. Aside from game-related companies, many of the tech start-ups in this region are in B2B. It’s certainly more evident here than in other regions, like Germany, for instance.
What’s also important to us is that companies in this region tend to orient themselves right from the start toward expansion into other markets. It’s a characteristic that seems to be in the DNA of many Nordic businesses. This characteristic fits very well with our own investment thesis – we only invest in “global stories.”
NM: What makes Maxfield Capital different from other venture capital firms?
AT: Firstly, I would say it’s our global approach. We have “points of presence” in Tel Aviv, New York, Silicon Valley, Moscow, and London. This geographic diversity gives us experience and access to the business climate in each of those areas and lets us open those markets to our companies as needed. For start-ups that really want to expand internationally, our multi-regional “footprint” can help open doors for them in new areas.
We pays lots of attention helping companies with business development as it’s a part of our Smart Money program. For instance, we helped MONI by finding useful leads for them with MasterCard Europe. We have a specialist on staff to lead these efforts and help the companies we invest in make these connections in a systematic way.
Another factor that differentiates us is that we’re able to recruit top-notch specialists from the CIS countries at lower cost. We all know how hard and expensive it can be to hire professional talent in tech. We do that for our companies on regular basis.
NM: What startup verticals interest you the most right now?
1. Big Data: it’s not just a buzzword anymore. And yet no one can list entire niches where it can rocket industry to the next level of efficiency. But this will inevitably happen. As a B2B-focused fund, we are betting on logistics, agrotech, transportation, fintech and other vertical markets. One of the challenges Big Data is facing is legislation. We have all recently become aware of the need to create a human-friendly policy that protects personal privacy. The next step will be preserving the privacy of companies’ data with the ability to collect and store such data securely. This may continue to be an issue with implementing big data services, especially for large organisations.
2. Fintech: We’ve all seen how disruptive the first wave has been in this niche. I think next boom will relate more to the internal processes of banking – things like scoring, underrating, regulatory compliance, and other important business processes for finance organisations. For now, the new trends are still hard to predict. Also related to this are emerging services for people who haven’t had access to Europe’s level of financial services. With projects like “flying internet” from Google and Facebook, start-ups will find many opportunities to take care of people who have never “banked” with traditional finance organisations. This could be the next big market for such companies.
3. Insurtech: Much of what I’ve mentioned regarding the fintech vertical also applies here. In terms of technology-driven efficiencies, the insurance industry hasn’t changed much in years. For example, we know that insurers that track drivers and personalise their ratings based on individual driving styles can gain a lot of business from drivers who focus on safety and following the rules. I believe we’re at the dawn of a new era of personalisation that is likely to transform this traditionally conservative industry.
NM: What are you biggest predictions for the next 12 months?
AT: 1. Growth in cross-industrial projects, meaning tech projects that require more off-line expertise – I see that happening in areas like agrotech, fintech, insuretech, energytech, etc.
2. Deeper “monopolisation” of the market – that is, I see the role of large international corporations becoming even more significant when it comes to dictating standards, industry trends, and so on. We will see more of this in Europe and South Asia. Regarding Europe, I expect that in the coming year we’ll see the next Unicorns emerge there. Maybe some of them will be from the Nordics.
NM: Are there any specific ideas for companies you really wish someone would build and you would potentially fund?
AT: It would great to see a truly “smart home” system. I’m thinking of something that would not only interact with in-house devices, but would also monitor the overall environment. It would take external communications, personal assistance, occupant health monitoring, and other such factors into account.
NM: If you could wave a magic wand and instantly have any imaginable solution to a problem you’re facing, whether personal or professional, what problem would you solve?
AT: My colleagues, partners, friends, and family are spread across the world. I typically spend about 40 hours every month just traveling by air. The time that’s wasted in transportation and the effect of jet lag are two problems I’d solve immediately if I had a magic wand.
But in all seriousness, the first problem I’d solve would be humans’ short lifespans. I truly believe that 100 years is not the upper limit.
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