 Hi everyone, thanks a lot for joining us. I'm Victoria Turk, features director at Rest of World, a publication that covers technology beyond the western bubble. I'm delighted to be joined by Elizabeth Rossiello of As a Finance. Elizabeth, do you want to give your own introduction? What is As a Finance? What do you do? Sure. Well, we're the market leader for foreign exchange and B2B payments in Africa. We started out nine years ago in Kenya trading Kenyan shilling against other African currencies. And nine years later, we trade between Africa and the rest of the world in digital currencies as well as fiat currencies for the remittance industry, e-commerce, corporates from east west, south and north. So we've kind of built both the infrastructure and the trading functionality for FinTechs across the continent. And who are your customers? We world remitt, Airbnb, PayPal, all the big tech companies as well as a lot of traditional Fortune 500 companies like Procter and Gamble and Unilever. And more importantly, a lot of the tier two African banks and African corporates across the continent. Anybody really doing business in, out and across the African continent. Great. Now the focus or one of the focuses of our talk today is partnerships. And originally I was going to get you to kind of start at the beginning of your story and go chronologically, but it's been an interesting week or so for you regarding a particular partnership of yours. When we spoke just two weeks ago, you was excited by the opportunities of this partnership, which you'd made earlier this year. But that I think has maybe changed a bit now because that partner was FTX. For anyone who hasn't been following the tech news, FTX was a massive crypto exchange. And it imploded quite spectacularly last week, ultimately filing for bankruptcy. How has the last week been for you? I mean, I trade Nigerian Naira, so I'm used to volatility. And we have a very resilient team. I would say it's our core functionality. When I started the business, our original name was Bitpasta for anybody that knows way back in the space. We were the first exchange on the continent of Africa to trade Bitcoin versus African currency. And we were the first exchange run by a female team. So that's pretty exciting. We're OGs in the space, as they say. When we moved to West Africa, our West African clients didn't like the word Pasta, which is an East African word. So we ended up changing it to as a finance. But we've been in the space through many bull and bear cycles. And although there's been a lot of interest in crypto in Africa, we never really saw a big brand invest. And when FTX came to us last year and said that they were interested in expanding their FTX Africa division, we were happy to work with them on a partnership. But like any good partnership, if you're not the same size as your partner, you really need to make sure, especially if you're the smaller partner, to ring fence what you do with them. And we've been in business long enough working in every kind of market in all cycles to know that having those boundaries are important. So while we did do some marketing with them, we made sure that we stayed within our licenses of payment service provision, foreign exchange trading, remittance processing, and let them do what they did. And I think that's a huge lesson learned. And as they unwound in the last few weeks, we didn't hold any funds for them. And there wasn't any kind of add-on effect. I mean, it's not a great reputational look to be associated with a company like that. But I think it's part of the development of the industry. And in the nine years that I've been in this space, we've seen a lot of companies go bust and a lot of companies grow beyond belief. We count Circle as well as one of our partners. And, you know, they've been a really success story. So I think we can't, although it's very tough for the users and the consumers that were affected by this, I don't think it affects my long-term vision for the digitization of the foreign exchange industry and also the international remittance industry. So what has the impact of FTX's implosion been on as a finance and on your customers? I think it's just more the high hopes that there was this really big company that was willing to expand globally. And we've seen a lot of big crypto companies focus on Asia, focus on Korea, focus on North America, a couple on Europe. But there has no been big win on the African continent. There's tons of users interested in this. It's like one of the number one Google searches for crypto is in Nigeria. We've seen a lot of uptake on this space. But just like lots of brands globally, they're uncomfortable going into a region that they don't know. And we have this joke amongst our team that Africa is always two years away. You know, when we would talk to Facebook or Meta back in the day, they'd say, oh, Africa's two years away no matter what year it was. And, you know, we've been really excited that as we've grown we welcome some of the biggest brands in the world onto the continent helping them expand their business, taking away their currency risk, helping them process payments. But we don't see a lot of large companies go to the continent first. And they really look for a partner to do that for them. So I think we had high hopes that this would be one of the first global brands that would come in and expand and put money towards expansion. But, and so that's really the biggest disappointment. And it's been a bit of a mess when they filed for bankruptcy. They actually listed some as a finance entities in the in the bankruptcy listing. You've had to deal with quite a bit. What's it been like the past week? What have you had to do? Listen, we're a licensed business in the UK, in Spain, in six African nations. I don't understand how a company so much smaller than them had so much more regulatory oversight. And our board is much more up to date than clearly any kind of governance structure they did in or didn't have in place. So I think for us it's just shocking to see how disorganized it was and how much capital flowed into that business with no requirements of governance. I mean, if you work in the emerging markets and you have a startup, you know how hard it is to raise money. And you almost have double, even triple the layers of due diligence that other companies have. So I think I'm just rolling my eyes at what a mess it is and how they included all of their vendors on this list. I mean, it's just completely irresponsible. And you say that was erroneous. You've had to correct that. Yeah, they've corrected it already and it's been corrected in Delaware. So, you know, it's just another messy detail. How did you find out about it all? Did you just see it on Twitter like I did? Yeah. Like everybody, we were, you know, talking to the marketing person and she told us she resigned. So I mean, and then we just got a slew of messages saying everybody we worked with was resigning. So I think, you know, listen, we work in Ghana where the study has depreciated 50% just in the morning. You know, we work in other markets where in Nigeria, the central bank governor decided not to use their local currency overnight for remittances. We've been through some wild times. We've been through, you know, security incidents and, you know, weather incidents and government changes. I think when you're building a business that requires infrastructure, which is what we have as well as trading with clients, you're slightly more resilient because you know that infrastructure is a long-term investment. So while we welcome clients and partners and we do also have this resilient mindset that infrastructure is a long-term investment and you have to protect yourself from anybody you're dealing with when you're structuring these partnerships and you have to protect yourself mentally from the ups and downs of the market. And how do you do that? How do you protect your brand when you're going into a partnership? You know, as a founder, your company is your baby. It's your projects and you have to kind of give away a bit if you're partnering with someone. But how do you make sure you have adequate protections in place that you, you know, aren't impacted as badly as you might be when things go south like this? We have a lot of learned lessons at the company and we have a great management layer. I was just listening to Nick from Revolute talk about how he likes to have as many direct line managers as possible. We also have a flat structure, but we have some really strong mid managers that run their teams and we do, you know, constantly do retros. We do planning sessions like religiously and we constantly remind ourselves of lessons learned. And you know, when we have new members come in, we say remember what happened in Nigeria or remember what happened in South Africa or remember that partner from the U.S. So since we've been operating for nine years, we understand all of the eventualities that could happen and we make sure to keep that present. And you know, I see a lot of fintechs come into the space and when you're in an emerging market, it's very tempting to do everything. They're like, well, there's no processor and there's no FX player and there's no, you know, wholesale buyer. I'm going to do all steps of the vertical. We've been very religious from day one and just doing our core business. We build infrastructure to trade foreign currencies and then we trade them. That's it. We don't do retail, you know, we don't do card processing. And so sticking very closely to your goals and following that, you can build your boundaries around you and not get pulled into doing things that a bigger partner might want you to do or that might take you away from your risk mitigation policies. And have you learned anything specifically from this experience with FTAX? Would you do anything differently the next time? I mean, already mid-year dealing with them, we were telling our teams like, no, no, no. You know, if they're asking for this, we're only giving them this. You know, I think the second the partner doesn't deliver on what they were expecting to deliver, like if the revenue wasn't there, they weren't moving as fast, you know, stick to your guns. And I mean, that's just general negotiation strategy. But if you're focused on revenue and you're focused on building and you're looking for that ROI, don't let a partner drag you into another space. And you spoke a bit about the reputational aspect. What's the impact on sort of the crypto industry and the fintech industry in Africa as a whole? Because when we spoke previously, you were saying, you know, people are less scared by crypto now. Something like this happens and suddenly crypto maybe seems a bit scary again. Do you think that will have a kind of lasting impact that goes beyond that specific exchange? I mean, again, if your currency is devaluing 50% every five, six hours, you don't have many options, right? So that's one. Number two, I've been saying for nine years the most important part of digital currencies is the ability to trade for 24 hours, seven days a week. This is not something that gets a lot of radio time. But, you know, as a currency trader, when we're settling with a client and it's Ramadan and, you know, their remittance volumes are skyrocketing between Friday and Saturday and Sunday. They want to be able to top up. They want to be able to trade Saturday night and the banking system doesn't allow that. When you're trading between Africa and China or even Africa and Europe and it's a US dollar holiday like Memorial Day, why should your entire system shut down? And for counterparties like us, that means that I have to carry a three-day risk over the weekend if I want to forward them payment or start to offer prepayment, which again pulls me out of my risk profile. So I think it's been really exciting to use digital currencies and a lot of our customers, I'd say 20% of our customers choose to settle with us in stablecoins because of the fact they can trade after 5pm US time or they can trade on the weekend. And for us, it reduces our risk because we have that digital currency and we cash out immediately. We're not a prop trading desk. So I think as a payment service provider or anybody who does processing, you want to constantly make sure that your working capital and your float are kept tight. You don't want to have float extended to all these different clients that haven't settled and you want to make sure you're not exposed to any sort of currency volatility, whether it's a West African currency, the Euro who's crashing or a digital currency. So your faith is still strong? I mean, the technology works. So I think the lesson is always there. Don't trust, the company trusts the technology. And having seen what I've seen working across the continent and just being in the fintech space and the finance sector for so long, I think I have the same belief. I want to go back a bit now to the start of your journey. Because I know there's a lot of early stage founders in the audience or aspiring founders who would like to learn a lot about your approach. Speaking of partnerships, when was that something that you first entertained as a founder growing a business? When did you get to a stage where you realized actually this is not something that would be most effective to build myself. I need to find someone to work with. So when we first started, it was pretty easy because anybody could connect to mobile money and we were just trading over mobile money and crypto. So it was very easy. There was no access and it was the first way to test our product out. And we launched that October 2013. As we started growing, we realized we needed permission from the partner, the telco, to do larger transaction amounts and we had to go to them to offer a potential partnership. And Safari com for anybody that's transacted in East Africa is famous for saying no to partnerships. So there's a lot of Kenyan startups that begin and then Peter out as the partner doesn't let them into the market. So we already saw that ceiling that we couldn't get in without a good partner. Now, fast forward, I moved my family to Nigeria and knocked on the door of the biggest partner in town, InterSwitch. And after a month and a half of knocking, we signed a partnership with InterSwitch. And business boomed. In two years of transactions in Kenya, I had barely hit $100,000. I did that in the second week in Nigeria. So again, the experience of the right type of partner where we were making them money, they were allowing us to make money. Everything was licensed so the customers were excited by the framework of safety that we had around it just again showed how important that was. So we actually created a team within the company, an expansion team, which is basically a partnerships team, which is, you know, the front team that goes out to a new market. So they'll go to Cameroon and say, are there banks here that we can partner with? Are there fintechs here that we can partner with? Should we build it ourselves? Should we rent it? Should we build and then buy it? And so in each market that we enter, we really look to who could be our InterSwitch. And we've replaced InterSwitch, by the way, over the years, but that was just our first partner. And I think that's been a key part of our thinking about how to expand across a region where each market is very different. But no market is really big enough to sustain us. We do need to keep expanding multi-country. And we've had a lot of different experiences. In South Africa, we tried to do it ourselves for a couple of years. We looked to partner with a local bank and we realized the life cycle was too long. So we acquired a company, E for F. And that was a great deal for us because we brought in an awesome team, which is already very profitable, with some exclusive partnerships that were part of that deal. And that was the right way to go. In a lot of the Francophone West African markets, we were first mover, so we built ourselves. So I think for us, with a continental vision, it's important to be flexible to have different partnership approaches in each market, but remember your core values. So you've had experience of good partners, you've had experience of bad partners. How do you go about choosing when it's right to partner versus maybe acquire or build yourself? And how do you choose who to partner with? What sort of due diligence do you do there? Yeah, it's funny because this is the toughest team to hire for. And for a long time, myself and my co-founder had to run that team. And the team needed a healthy dose of paranoia about not to get into a partnership that was too big for us, but how to be aggressive to do that. Now, nine years later, we have a lot of good young people who are really good at doing this. And it's a cross-functional team. So they're constantly talking to revenue. What are the revenue projections for this? They're talking to product. What would integration look like? They're talking to engineering. What would the security look like of this relationship? They're talking to licensing and compliance. So it's a truly cross-functional team because if you go ahead and sign a partnership that doesn't have revenue that pans out or that sucks up, you know, 12 engineering sprints or that, you know, the product team can't get their head around, you're going to again steer your ship away from your core plans. So I think it's been really important to kind of perfect what this team looks for and how they operate. And we run an agile company. We have a lot of very short meetings all day long. We have a lot of ways that we manage and plan for goals. So I think this is exactly something that we're really good at because of that. And how do you approach the sort of negotiation phase when you want to partner with someone? Obviously, you see a benefit for you, but you need to sell a benefit to them as well. It's a partnership, right? What's your kind of advice to people looking to make friends and partners? What incentives need to be aligned? You know, I've met so many people definitely in the crypto space, a lot in the fintech space that seem like angry. How dare this bank not partner? Don't they know my product is going to take over the world? You know, how dare they not be on board already? You know, well, because you're going to take their market share. So obviously they're going to close you out. And I think having spent a lot of time of my career in markets that are co-opted or have monopolies or oligopolies, we already understand that day one. So how is it going to make sense for the partner? How can we make this partner money? How can we show this partner that by working with us, they might lose something that they already had but gain something that they didn't? And it has to be real. And we have to move fast and show that very quickly. And how do we work with partners that take forever to make decisions or take forever to integrate? We have to already accept that that's the fact and go in there ready to work around it. So we will lend engineers to our partner to make sure they go faster. I will put my own team into their offices. I will go there every day with donuts, you know, and whatever it takes to make it happen. But I think sitting back and getting upset that the partner is not moving at your pace is something that prevents a lot of startups moving forward. And you're obviously operating specifically in Africa, many African markets. I wanted to talk a bit about emerging markets or frontier markets, whatever term you want to use. How have you found partnering in these markets? You mentioned sort of Treadfy can be a little slow to work with, maybe a little, you know, take a bit longer to come around to new ideas, fintech. How have you got over that barrier? And how is the environment now? Are things kind of changing? Are people more open to you? Well, I moved to Kenya in 2009, so two years after EMPASA arrived. And in the eight years that I lived in Nairobi, the entire country adopted this technology. So I was living on another planet than the rest of the world. I remember going to some tech conference in Istanbul and they were like, you can go to an ATM with your phone and withdraw money. And I was like, we've been doing this in Kenya for six years. So I think I was really privileged to be in Kenya at the time where I saw an entire population, you know, who may or may not have been financially included before, very quickly get up to speed. So I knew that, you know, it wasn't, there wasn't like a demographic that couldn't adopt technology that never really entered my mindset. So that was pretty exciting. But what I did see was that if there's an existing monopoly, it doesn't matter what the population wants. So when we went into West Africa, I think we saw in Nigeria a very different situation. Nigeria had been cut off from the rest of the world due to ideas about KYC and compliance. And the population is 200 million people. So what are they going to do to service their own financial services and they can't use any sort of correspondent banks? Even today, if we have a transaction going out, it requires additional compliance. So they created their own switch, inter-switch, and it was a 24-7 instant switch, which is better than what you have in the United States. So I think even there, the perception was, wow, cool, everybody should have 24-7 settlement, you know? So again, I was in a place that was even better than where I had grown up or I had worked earlier on. So I think the perception that the Sub-Saharan African markets are behind or it's a struggle is, you know, not real. What I saw firsthand was a really readiness and a willingness for the financial sector to experiment. Now, I think what was different there is that you have very strong companies in smaller markets. So it feels like there's a big partner you have to win or get involved in. I think that's different than when we work in the United States or Europe where there's not one bank dominating the entire U.K., you know? And there's a bit more of fair competition. I think that's the one difference. And what about the impact of COVID, the pandemic, with sort of out the other end now, at least in terms of kind of global lockdowns? But what was the impact of that for you as, you know, a digital finance company? Well, one, it was just great as a working mom to like work from home. That was nice not to travel anymore. I really enjoyed it. The second thing was just the adoption was huge because the traditional banks, especially in these markets, were not set up from working from home. If you live in Lagos, most likely your commute is two hours plus. So a lot of these employees were like traveling two, three, four hours a day to work throughout the day. And we got that time back. All of our employees suddenly had three more hours a day where they were able to work. And because we had a very high-tech business and everybody already communicated over Slack, they were immediately more efficient by three extra hours a day. And we have already given, you know, energy supplements to have generators or power online for power cuts. That wasn't something that a lot of the other traditional banks, so just on those two small things alone, our efficiency was 30-40% higher than the incumbents of the market. Secondly, their platform wasn't there to service their customers. So we saw a lot of customer migration come onto our platform during that time. And then of course, a lot of these markets are, you know, petrol-based markets that are really affected during COVID by the global slowdown and the petrol price volatility. And of course, following COVID, you know, the invasion and the euro crisis, so we see a lot of volatility in these markets on a macro front. But the opportunity and the market demand is so great, it softens it quite a bit. So you have these global macro shocks, but you still have the youngest demographic in the world. 40% of the population of the world will be African by the turn of the next century. You still have so many people who grew up with mobile money or 24-7 settlement or e-banking or mobile banking. So even though you see these global shocks, you still see such a market demand. So it was really great for a lot of the fintechs on the ground, including us. Great. So we've just got about one minute left. So tell us what's next for Arthur Finance. Where do you go from here? So we're just building infrastructure across the continent. We're really excited about our trading Central African currencies. For those of you that don't know, we have two zones from Francophone Africa, West Africa and Central Africa. Cameroon is a sleeping giant, just about waking up right now. So we're really excited to offer that. And we're working with more global customers to bring them into the market. Another exciting thing that we're doing right now is offering forwards, which is kind of new in the remittance industry. There's not a lot of players that trade currency can settle it for you and offer pre-funding as well. So we're expanding our product to offer all sorts of treasury services for fintechs that are coming into the space. Great. Elizabeth, it's been delightful chatting with you. Thanks so much for joining us. Thanks for having me.