Fenergo’s Stella Clarke on the making of an Irish fintech giant

Podcast Ep 79: Fenergo chief strategy officer Stella Clarke talks about how the Dublin unicorn plans to grow globally by helping financial institutions to fight crime and enhance customer journeys.

In recent months one of Ireland’s newest unicorns Fenergo – valued at more than $1bn – expressed its desire to achieve a valuation of $5bn in the coming years. The revelation came after equity firms Astorg and Bridgepoint signed an agreement alongside the company’s management team to acquire the majority stake in the company in a deal reportedly valued at $600m.

The acquisition came on the heels of a period of strong expansion for Fenergo and the company subsequently revealed plans to create 100 new jobs in Dublin, growing its total headcount to around 1,000 people.

Fenergo’s trajectory and deft strategy resulted in founder and CEO Marc Murphy recently being selected as The Irish Times Business Person of the Month, an award run in association with Bank of Ireland.

Established in 2009, Fenergo’s award winning SaaS platform provides solutions to the world’s largest and most complex financial institutions, helping to fight financial crime and to enhance customer journeys while being compliant every step of the way.

Fenergo currently helps top financial institutions including ICBC Standard Bank, Santander, Mizuho, ABN AMRO and BNP Paribas to digitally transform their end-to-end client lifecycle processes.

In the financial year ending March 2021, Fenergo’s revenue increased by 17pc to USD$107m.

The next chapter

Speaking with ThinkBusiness, Fenergo’s chief strategy and marketing officer Stella Clarke said that there have been effectively three chapters to the Fenergo story so far. “The first chapter was building the business, acquiring our first customer and really developing and delivering a product fit for purpose that could serve large financial institutions in different geographies. You saw a change in 2016 when Insight took a stake in Fenergo and really helped the company to scale up.

“The last five years have been about the acquisition of new customers across geographies and we have clients in America, Canada, Europe, Australia, and it was about growing to about 850 employees. That’s where we are today.

“With the latest acquisition we are really gearing up to the next phase. The next phase, which we like to call chapter three, is really about scaling up Fenergo in terms of go-to-market in operations, geographic coverage and the type of market and segments that we can penetrate within financial institutions.”

Clarke, a French native who married an Irishman, is clear-cut about the company’s strategy. “Our main customers are banks and also financial institutions like asset managers, wealth management and insurance companies, and we solve the issue of managing the lifecycle of their clients.

“What we mean by that is we help them to really digitise and automate the process of onboarding new clients and opening accounts in a safe way. This means meeting requirements from an anti-money-laundering, Know Your Customer and regulatory perspective. We help them manage their life of the client from the first touchpoint and onboarding. That is our business.”

Digitalising banking

Dublin has a fast-rising coterie of young fintech companies, no doubt emboldened by the success of another Irish-led company called Stripe which is also growing in the city.

Asked what makes Dublin a good place for fintech, Clarke said there are a number of aspects. “The first one is that the industry itself is in Dublin and you have a large representation of financial institutions from banks to asset managers to fund administrators. So you really have a strong ecosystem, which in turn means you have business knowledge and understanding of business processes related to financial institutions. This is very important for fintech and it’s the basis of what we do. We are looking to solve pain points for financial institutions.

“The second aspect is that Ireland is an English-speaking country that has close ties with both Europe and the US. And in fintech this is critical in terms of client acquisition. It really is an advantage.

“The third aspect is really the quality of the education system in Ireland. You have a plethora of Irish-educated software engineers in particular, plus its an attractive place for European talent. With such a concentration of big tech here in Dublin and the fact it is English-speaking it is very attractive fro French or Spanish or Polish people to come here to start their career. So those three elements qualify Dublin as a very attractive place for fintechs.”

Fenergo’s foundation in the wake of the global financial crisis of more than a decade ago was well timed. And no doubt as the pandemic crisis begins to wind down, the appetite for digitalisation is growing.

“Fenergo helps institutions like banks to digitally transform. If you look at what happened after the crisis of 2008, there were a lot of new constraints and rules across the world to make financial institutions safer and regulation become more important. Banks, because of their legacy architecture had been adding layers and layers to fix things but in reality didn’t have the opportunity of time or budget to really reinvent the way they do things and how business processes need to be handled. Whereas neobanks can just start from scratch.”

This is where Fenergo steps in and gives established financial businesses the firepower to compete technologically with rival neobanks.

“At Fenergo, with our software-as-a-service (SaaS) offering, we are able to take some of the processes of a financial institution and do them in a way which will be new, attractive and nimble.”

Clarke says that the challenges facing institutions are never-ending when it comes to transforming digitally and staying up-to-date and relevant. Currently there is a review of the Anti-Money Laundering (AML) Directive in Europe as well as its US counterpart to contend with and what it will mean for the era of Open Banking.

“Data sharing between banks is still in its infancy,” Clarke said.

Winning the war for talent

The global pandemic has done little to dim the fires of the global war for talent. Growing its headcount in a city where big tech giants like Google, Salesforce and Facebook are also continuing to grow, must be a challenge.

However, Clarke believes the opportunity to be part of a powerful growth story sets Fenergo apart.

“Software engineers are at the heart of what we do. Because we are investing heavily in our SaaS platform, we offer a very interesting development environment where we are leveraging the AWS (Amazon Web Services) stack. For young engineers, working at Fenergo would put them at the forefront.

“Another plus is that we are Irish, which is attractive for local talent. We have a large client base and this means you get to work on implementation for clients in exotic locations so there are opportunities for travel.

“On the commercial side, there is a lot of diversity and opportunities to be promote internally and move across product management to product marketing as well as sales and customer success. So there is plenty to do and plenty of reasons to attract talent.”

Fenergo CEO Marc Murphy was recently named The Irish Times’ Business Person of the Month, in association with Bank of Ireland