Hi guys, welcome to the Fintech Coffee Break. I’m your host Isabelle Castro. This week I shared my coffee break with Andrew Jamison, co-founder and CEO of Extend.

SMBs have continued to be underserved by the banking ecosystem, and have been hit with even more challenges as the year has rolled out. I spoke to Andrew about why the sector is still an area ripe with opportunity and how partnering with banks rather than competing with them has allowed Extend to maximise that impact.

He also had some really insightful ideas about where the space is headed in the future, and shared his plans of where extend will be growing next in their quest to solve problems for SMBs.

Isabelle Castro 0:43

Hi, Andrew, how are you today?

Andrew Jamison 0:48
Very well, Isabelle, thank you so much for having me on the show.

Isabelle Castro 0:50
I’m really glad to have you on the show. I remember when I interviewed you for a article, and it was such a good interview that I just had you had to have you on?

Andrew Jamison 1:02
Well, I hope not to disappoint on a second.

Isabelle Castro 1:05
I’m gonna show you why. So to begin with what gets you up in the morning, Andrew?

Andrew Jamison 1:11
Look. I mean, it’s there’s different things, right. There’s obviously the personal side of what gets me up in the morning, which I don’t need to share with anybody. But there’s the professional side of you know, what gets me up in the morning and motivated right to go into work. And a lot of that, to me is always been anchored around solving complex customer problems, right, I actually enjoy the complexity of it. That’s one of the main reasons why I’ve always stayed in that B2B ecosystem, right. I’ve never stayed in that. So B2C, which is a lot more focused around marketing and emotion and the complexity that sit there, I was always much more interested in sort of figuring out end to end how businesses operate together. And then where there’s friction, how do we simplify some of that friction. And I guess, I learned that in the earliest days of my career, just simply because I was working alongside SAP and looking to do global deployments, that platform, and anyone who’s worked with any ERP realises that is no small feat. And so for me, it was just, it just got me intrigued. And then I sort of went to annex for 12 years and sort of, again, was working at B2B side of the business where you’re dealing really with CFOs, right, who sometimes are known to be a little bit black and white, and how they see things. And so I kind of enjoyed those interactions. And that’s really what spurred me to really go and create Extend was, was really that knowledge that I was going to go and do something that I’m truly passionate about. And I love motivating teams to go and solve these problems. And I tend to find if you hold people accountable to these things, they kind of run towards the challenge.

Isabelle Castro 2:44
Okay, I like that. So I mean, you kind of touched on it a little bit. But tell me about your career journey to co founding Extend?

Andrew Jamison 2:53
Yes, look, as I mentioned, right, this, I’ve actually not had many jobs, right, in the grand scheme of things. I’ve only worked for two other companies before I went and created this. And I think that’s just more of a testament to the passion. I had really for B2B. And I think it was really because in the grand scheme of things was fairly immature in terms of its journey through technology. And we’ve seen and we continue to see right that the stitching together with different technology platforms, to try and solve the things Things are becoming more and more verticalized. So actually, solutions are becoming more user friendly, than the generic solutions that used to be out there that would apply to you, whether you were in manufacturing or advertising or whatever industry you might be in now they’re sort of really starting to narrow those things down. And so for me, that journey was was always going to be rooted in that. And I chose the finance function in there, with a view that things always had to end up at month end closing with actually closing the books. And so again, it was about how do you go from what used to take weeks down to now what in some cases takes just hours for companies to close their books? And that’s really been the journey for large market, but I think I’ve been fascinated more and more about, okay, but what about mid market? What about small businesses? How do we make their lives simpler? How do we automate things for them? And that’s really where we extend comes into play. was was really about how do we help the office of the VP of Finance because they’re not really even CFOs? Sometimes, right? They’re essentially just one of the many functions that they do as part of their business. But also now we started to find ourselves going upscale to middle and large market, but it’s a different type of platform and product that we tend to, to to consult around in that space.

Isabelle Castro 4:41
Okay, so you started with kind of SMBs verging more on the smaller side, but now you’re moving towards the medium and larger side.

Andrew Jamison 4:51
Yeah, so it for me, it’s all about understanding again, the need right, where’s the complexity lie? And I think the complexity For smaller, larger and very different places, the way I look at it from a small business perspective is I just need things to be simpler. I don’t have the luxury of having departments, right, let alone, you know, department heads and a whole team’s going away and solving my challenges. I’m a department of one in some cases. And sometimes when a department or two or three, maybe there’s somebody does eight accounts payable, some of those receivables. But the reality is, they’re small, they’re nimble, and and they really, therefore need to get through these tasks faster, anything you can do to them, that provides them greater efficiency, transparency, security, right at the same time as an ability to optimise a little bit on working capital in terms of time to pay, and then on the back end rewards. And those things, which again, help many of these businesses run efficiently. That’s one set of challenges. I think that on the large side of the business, they have different types of challenges, which is that it’s huge grey contingent workforce, contractors, freelancers. And so it’s about for big business, have you implant those individuals, so that these big businesses don’t have to go and process receipts around expenses, or online subscriptions or other services they need to buy in order to fulfil what they tried to do as a contractor or as a consultant for that business. Right? So remove paperwork, right, approve things upfront, give them a vehicle to go make those payments, make the reconciliation seamless at month end, right. And that’s what they’re looking for. Right? Small Business, on the other hand, is much broader. It’s a lot of tail spend the thought of invoices that they want to process through AP, they want the payment to represent both the invoice and the settlement at once. Again, because they don’t have procurement systems, they don’t have right travel and expense management platforms, right? They deal with things in much, much simpler fashion.

Isabelle Castro 6:56
I want to, at the moment focus on kind of the smaller end and SMBs. Because they’ve still really underserved. They’re quite complicated. And recently, they’ve been quite badly hit by the macro economic landscape. How have you noticed a change in their needs? And how within this landscape within this challenging landscape? And how have you helped them through that?

Andrew Jamison 7:28
So look, that anytime there’s a downturn, right, there is always right, a greater impact on small business, right, they typically don’t have a deep balance sheet that allows them to navigate through some of these challenges, right, that may cut their revenues for months. And so once we haven’t seen reduction in spending, we can see growth, actually through the platform. And I think we see growth, because we are providing what I mentioned before, right, some of this efficiency, right some of these insights to what’s happening in real time versus them seeing these things coming through a month later, or two months later, in terms of an invoice or payment, all these different things. So I think that’s what we’re driving towards them, we’re still at the very beginning of this journey in my mind. And whilst we do create an application that helps them broadly with respect management, right, in terms of, you know, how they’re going to settle invoices with suppliers, how to empower their teams, to go and spend, right in a controlled fashion, that provides true visibility, and therefore allows a VP of Finance to curtail spending where they see it happening in the spaces where they don’t want it to happen. I think, you know, again, what we’re going to see over time is, is again, what we’re seeing in the larger side of the business, which is more this embedded side of the business. So today, and I think you alluded to this, for small business, many things happen in disparate places, many disparate places. And that’s kind of the frustration of small business, I think it’s like, great, I have to do this across seven different platforms. Right? The reality is, like Western CMR, to market more and more of this is going to be embedded into an existing experience, right, which is, hey, if I’m using this application, can I essentially manage these tasks manage this approval workflow within the solutions I already have? So you keep me in an experience that is adding to my experiences, right? And I think that’s the ToodleDo version. We’ve seen a lot of this happening in consumer because it’s simpler, right? Similar consumers are, are a person of one, right? It’s not a team of people. So it is more complicated for business, because you have to do closings, and you have to do the counting of things but you don’t in consumer. But obviously what we’ve seen in consumer is in experiences, whether you’re ordering food or car services, that payments, just part of the service. It’s embedded in there. And so what we’re going to see is more and more that’s embedded in the software solutions that QuickBooks and So what are the different applications that these companies are using? That’s where this is going.

Isabelle Castro 10:05
Okay? And is this way you’re positioning yourself going forward?

Andrew Jamison 10:10
Yeah, very much. So I think partly because we’ve identified one of the challenges that’s prevented growth. And that’s really around, you know, a standard, a standard to which software companies can go into design and build their products to interact more easily with the bank of choice of that customer. So let me give you an example. So in the world of payments, right, when we start thinking about ACH, there’s a standard, it’s called Nacha. If there’s a standard for international payment, it’s called SWIFT. Sure there’s disruptors doing different things in that space. But bottom line is, they’re doing it through through different standards. In the case of cards, right? There has actually been no standard around card issuance standards around how once you’ve transacted, those transactions are presented back to you and can be pushed through expensive solutions. But around card issuance, and specifically around controls around those cards, every bank does it differently. And so how do you build software, when effectively you’re not having to manage a Spaghetti Junction, your job is not to be an operator, and that you’re building software. And so the software providers haven’t wanted to either invest that many resources to help manage, right, that middleware layer of how do I connect A to B, when I know that goes through three different trap doors, and those trap doors are different, right, depending on who that bank is, who their current network is, and who, what back in the infrastructure they’re using. So that’s what we’ve done is say, hey, there is a standard, we’ve now connected to a dozen banks, we have a number of other banks coming through the pipeline, where we can now say these top right, here’s a standard is just one set of API’s, you can code to that. And now you can get back to what you do best, which is build software. So I do think that’s where the journey is going to take us. And that’s where we’re starting to see really, really positive traction in this space.

Isabelle Castro 12:07
Okay, that’s really interesting. Yeah, I did want to ask you about your choice to partner with banks. I mean, you’ve partnered with banks, if I’m not mistaken, throughout the whole of your existence. Why did you initially make this decision? Rather than kind of be a Disrupt? Well, I would say you’re disrupter anyway, but kind of compete with them, as others have done.

Andrew Jamison 12:33
Yeah. So I think the way I looked at it is, I don’t think the card world right is in need of massive disruption. Right? It’s like there’s a million different cloud providers out there, right across consumer and business, more business and light and large market. And I think ultimately, most people will tell you that they actually trust their bank, do they think it’s the best experience? No, but less and less of experience today involves you going into a bank. And so the bottom line is also banks have navigated their customers through thick and thin right through up cycles down cycles. And so yeah, they understand right, what it takes to take a small business through these these cycles, they have built relationships, they’ve built trust. And I think through that comes an ability to underwrite more effectively, I think what we’re seeing here, what we have seen with some of these disruptors, is suddenly when you get to a tough junction, they start saying, well, actually, we’re not going to service that customer base anymore. It’s too risky. Because they don’t have the history, they limit, essentially, also, the services that they can offer those parents, they don’t have a full portfolio view. And as a result of it, right, they can’t take that that broad picture that the banks can. So my, my vision of the world was much more. Okay. So they all have cards. Now, what are the pieces they’re missing, and a piece they’re missing is some of the digital experiences. So that’s what we focused on, we’ll say, hey, let’s keep the core of what’s there. Let’s reuse what’s there. And let’s go and build, like a digital layer around this infrastructure and often use the analogy of Rome, right? Rome wasn’t built in a day, that Rome wasn’t a case of like, Let’s strip it out and started with just brand new buildings. It’s a beautiful mixture of old and new. And that’s a little bit of where I see the ecosystem going. Because what people have also realised, is by ripping and replacing a ledger, you actually don’t get a huge amount of benefit as a business. And so actually, the better players say, hey, how do I just abstract away this, this experience, which is far from beautiful, it’s on a green screen, right? And how do I just make it essentially a more modern set of applications that sit over the top of it, that can also start pulling in other services from other providers to sort of join together these capabilities to to really create an experience that is appropriate for a small business or a middle market business. But it can’t be the same experience for a large business to really small business, which is what companies have had tried to suggest them right into those different segments. So I’ve always been a believer that let’s go service establish base and us from the US perspective, right and commercial side, it’s been about a 1.4 trillion market. So yes, you hear about some of these players doing 10 billion a kibbutz they didn’t 10 million on a market, that’s over 1.4 trillion. So actually, yes, they’ve done really well. But the core still sits with the banks, and is still looking for solutions. And that’s where we’re stepping in. And now, I think it’s a different part of that story is, it’s sometimes easier to get up and running, if you can choose all of your own pieces, which is where these fintechs have benefited, right, it’s like, I’ll just cherry pick what I want to run, because I have no dependencies, what we’ve done is a little bit different. It’s like we’re climbing Everest out of the gate. Why? Because we’re looking at these really complicated things, and saying, Hey, we’re gonna have to mesh them together, which is what’s taken us the best part of five years is to mash these things together to make it a workable solution, so hard to get off the ground. But once we’re there, we really start to see the benefits of being able to roll this out across the millions of customers that already have a card in their hands. Right. And that’s the key, we can then make it a feature of that piece of plastic, rather than having to get them to sign a new contract for a new piece of plastic.

Isabelle Castro 16:20
Okay, okay, I like that. Well, because we are in the kind of banking sphere with you. I wanted to direct your attention to kind of this year, we saw the launch of Fed now, which a lot of people had told me could make a big difference for business banking operations, and elsewhere in the world. You’ve seen kind of the rise of a gateway and instant payments, instant payments. I know you guys focus on virtual card, that area, but do you see these instant payment rails feeding into your future roadmap?

Andrew Jamison 17:01
For me, it’s, it’s going to be something that will continue to assess, right, obviously, I want to be able to offer more services. But again, I need to make sure that I’m actually solving a problem here. And that’s the first thing, right? So you started looking at sort of instant payments, it’s okay, what are you replacing? Are you replacing ACH, you know, the same day ACH now? So is it really just a 24 hour time period? Am I able to send more data with a real time payments than with an ACH? So can it help reconcile, and I think there’s still very much at the infancy of this journey, right of what this is going to look like. And ultimately, you also have to remember, this is about trust, right? The speed is confirming that money from A to B, and therefore, hey, I can trust you to deliver the goods. Right? And so I think you have to understand also, where do we likely see that the fastest adoption of this, I think it’s going to be in industries where trust is key. And if we’re gonna accelerate, right, the handshake down to a matter of minutes versus, you know, they hours, whatever else it is, then there’s a reason for it. But it’s a little bit like checks today, it’s a sunk cost for most businesses, we all agree is far from efficient. But everyone’s got locked boxes, and everyone’s gone to operationalize our experience. You don’t go into your bank to deposit checks, but you take photos of your checks, and the funds appear, you know, fairly quickly thereafter. Now, there’s, you know, it’s all school. But again, what is the benefit for that business? Right? Is it worth them spending time on that operational efficiency? Or actually on doing more promotion, more marketing and advertising? top line is the bottom line? And is that bottom line saving? Big enough? Right to one, that company making that change? Because like everything, it’s about privatisation of limited resources. So that’s why I’m always you know, I’m eagerly looking at the numbers and trying to see what that conversion cycle looks like. And then trying to figure out the patterns of what industries are doing this and why are they making that change? Because then you start to say, Okay, there’s a broader need there. And if you can figure it out for an industry vertical, then yes, that vertical will need to be served in small business middle market as well. Right. But I haven’t yet seen that tipping point where I’m saying, Okay, this is absolutely where we go next. Because I can really solve the critical pain points for businesses, we’re still seeing more in that ad hoc invoices tail spend, right? Employees who don’t have cars, we still see a greater opportunity there than I do at the moment. Right, in the real time payment realm.

Isabelle Castro 19:32
Okay, that’s, that’s really, really interesting. Um, you said kind of at the beginning of this conversation that even though you guys have been in the industry, and you have been in the industry for a very long time, you still feel like you’re at the beginning. What are your next steps going forward? I know you said you were focusing on the embedded finance piece. Is that your main focus or something else?

Andrew Jamison 20:03
So, so luckily, there’s no video here to see my grey hairs, right? So I can I can pretend to still be young, despite the fact I’ve been in this industry for a while. So I think that the reality for me is I think embedded payments is the next frontier and it isn’t something that’s going to happen overnight. It is something that has to go painstakingly software solution provided by software solution provider. So I think it’s a long, long journey there. But it’s but it’s a it’s a journey. That’s very much worthwhile undertaking. So I’d say that’s probably the the biggest strategic change that we will see in this space, what impacts more middle sized businesses. Why is this whole concept of solution providers meshing themselves into one poor experience, right, because a little bit like in consumer, you know, you look at people’s phones. And it’s often quite funny to see like how many apps that you have on your on your phone, and you put them in folders, you have 600 apps, in my case, I probably have 700, because my kids want to download a new game every day. And it’s and it’s kind of the the the same, I’d say, in the context of business people are a little bigger app fatigue, and I don’t want to know, I don’t want yet something else to manage. So that’s why I think the embedded payments is really critical. I think the other area we’re going to go into, and when we’re well down that path is really around, how does a business that has 100 People 200 People think about expense management, because typically, those businesses are just too small, right to warrant going for a more traditional expense management application. They’re not big enough, they’re maybe not multinational, they’re maybe not a multi entity. It’s just one simple entity. And I look at as extended as a great example, that there is no easy solution that allows me to manage my, you know, 80 odd people in this company, and seamlessly write manage how I empower them with a card to go and settle for subscriptions, right for how we run our software, or for them to travel or book a flight or access a conference. So that’s a big area that we’re now working towards the say, actually, kind of like create a really simple solution, right? It’s simple, very reminiscent of consumers of, hey, I have a receipt, I take a photo, it is then associated with it with a transaction that went through, right, and we use AI in that journey, because that’s a really interesting piece. There’s like, again, which pieces do you pull off these different receipts? Or how would you pull that off an invoice and generate a card on the back end or send to a suppliers, you’re not keying things in? Right, you don’t have manual key errors. And so that’s where I think how we help small businesses manage the end to end journey of spend, not just the payment, but of the spend, right, and so that you essentially have a compliance solution that helps you capture all of the receipts, and then just as importantly, have a solution that allows you to take all of this data around, I might belong in a sales team versus a marketing team. So I do need those transactions to be assigned to the right department. And so how do we help these companies? Again, they’re not 10 people at 150 200. And they have these needs to be able to report by different departments. So again, how do we take that enrich data and help them push it into the accounting software, the general ledger that they use, so that we truly deliver on the promise of the CFO that we will make their lives simpler, and frankly, better, that will allow them to focus on running the business, because essentially, things are being approved upfront, things are being allocated upfront. And so once a transaction happens, it ends up in the right place, you know, out of the gate versus someone have to go and touch that.

Isabelle Castro 23:41
That sounds like a great application of what you guys are doing. I’m glad I’m glad you kind of mentioned AI, I kind of want to go into that a little bit more kind of what technological developments are you most excited about in the near future that you feel will help you serve SMBs and even larger institutions even better than you already?

Andrew Jamison 24:09
So I do think there’s there’s two different sides of that coin? I think, you know, when I look at we’re looking at one side of the business, which is again, how’d you how’d you stop fraud, right? And how do you take stop account takeovers, and all of those things. And I think that’s definitely a big area that’s continuing to develop there. Right? Whether it’s to do with, you know, authentication through your fingerprint, or it comes through, you know, SMS or whatever it is, but there’s a lot of development happening in that space. And I think that given that everything’s going more and more digital, and there’s a greater prevalence of hackers in the world and I feel like ever before, I think that’s a big area that’s going to continue to develop of how do we think about security, right, in an era where so much is happening with money digitally, that I think that’s going to be a big area that it’s going to continue to go to go and develop. Now in terms of AI and generative AI? Right, I think all of us are excited about the prospect of being able to use those tools. I don’t think we’re there yet necessarily across the board. But how do we help? Right? This this AI agenda I helped with servicing, right? How do we make servicing just a better experience for people? Because we’re able to pull the information and then serve it up the right way, right through some of these tools? And then how do we help? You know, when we see transactions come through? How do we see what’s on that receipt? How do we essentially then pull information across the board, we can help categorise things better, faster, and give, frankly, people better insights into where their teams are spending, right, where there are patterns that are different. I think that’s again, where there’s a lot of work to be done, like the concept of data and data lakes is not new. But it’s how you then sort of throw an intelligence layer at the top, it’s really where we’re seeing the next frontier happen right now. Right? It’s, that’s the exciting piece is how people are using that information, right. And then new services, we can help drive off the top of that, that becomes key by and that sort of, I’m helping the end customer through insights. Versus on the other end of the scale, I’m helping operationally mean that we would then we remain a fintech rival where the technology is doing the hard work in the servicing versus having to add lots of people into the business, which is frankly, not adding as much value as they could be if there were other assumptions.

Isabelle Castro 26:26
No, I agree. I mean, it’s great to hear you talk about this, because you can see your passion, and your kind of like ideas developing. It’s really, really great. We don’t have much time left. So I’m going to take us to the final questions. What is a piece of advice that you have been given that you would give to someone else this can be career orientated or personal life?

Andrew Jamison 26:54
So I look, I think, so on a personal life of things, I think it’s key for people to be able to take a pause somewhere along their careers just to check in, I think the worst thing that happens is you wake it up at the tender age of whatever it is 4050, and you realise that you’re creating go in the direction you want it to. And my view is, we have much more influence over our careers than we think. And mine happened, unfortunately, because of my mother’s health. But the reality was, it was it was a time and a place where I can actually stop thinking, and I feel genuinely go towards something that I was truly passionate about, not listened to what management saying I should do next, it was very much a case of like, but what what gets you up in the morning, your very first question, and make sure I’m checking that you’re still delivering against what gets you up in the morning. And sometimes, I think some people haven’t quite figured out what gets them up in the morning. So I think that’s the first part of the journey is actually what are you truly passionate about, know what people told you should do not what other people’s careers have gone towards. And I would say that’s one big aspect of things. And then when I when I think of, of careers in the same way, they think of developing product, nothing happens in one giant leap. Of course, as always one example of someone who did, right, so they went from here to here, and 10 seconds, and it’s amazing. But that’s just not, that’s not a particularly constructive way of thinking about career or thinking about how you develop product. And so my advice there is about, break it down, right? Break it down into micro steps, and allow yourself right the satisfaction of knowing that you’re actually achieving and you’re constantly scaling up that mountain step by step. And so Don’t set yourself the daunting task of I’m climbing Everest, but no, I’m going to Basecamp there may be steps in between that you and Basecamp. Right. And I think that’s, that’s the key is give yourself right, the pat on the back of you are making progress. But take the time to understand what that journey actually looks like. Whether it’s building product, building your career, I think you can apply the same principles there of breaking things down into bite sized chunks either because other people understand it better, or it just allows you to actually manage yourself right through what is actually a fairly lengthy process.

Isabelle Castro 29:09
Okay, both very good pieces of advice. I’m going to take them now your curveball question in the inner story of your life so far. Let’s say a new story. What would the headline be?

Andrew Jamison 29:31
We ain’t done yet.

Isabelle Castro 29:32
Okay, that’s really cool. We ain’t done yet. Perfect. How can people get a hold of you or follow you?

Andrew Jamison 29:42
I’m obviously on the main space I’m in is on LinkedIn. So easy to find there but also people can contact me right at work through my email address right which is Andrew at paid with extend.com important that is pay with there was another extended durian insurance business that started that started behind us in terms of timelines, but they bought it they bought the rights. So goes to show we were not willing to go and spend millions of dollars on that we wanted to build a business first. So, so we’re paying with extended dot-com.

Isabelle Castro 30:15
Okay, thank you so much for your time and coming on the show. I’ve really enjoyed our conversation.

Andrew Jamison 30:21
Now, I appreciate being here. And thank you for the thoughtful questions. fun as always,

Isabelle Castro 30:25
very fun. Have a nice day. You too, bye. As always, you can reach out and chat with me or my personal LinkedIn or Twitter at Castro rights. That’s about it you why? But for access to great daily content, check out Fintech Nexus on LinkedIn, Twitter, Facebook, or Instagram. You can also sign up for our daily newsletter bringing new straight to your inbox. For more fintech podcast fun, check out the website, where you can find more fascinating conversations hosted by Peter Ranta. And that’s it from me. Until next time, enjoy your downtime.