FINTECH
40
“ The vision since 2009 has been somewhat consistent , but what ’ s changed is how I have had to think about my role in relation to the company ”
— Tim Chen , Founder and CEO of Nerdwallet
Nerdwallet , according to Chen , has “ a bit of an unusual funding story as people don ’ t like to invest in what they perceive to be content or medium businesses in Silicon Valley . Overall , Nerdwallet has raised a total $ 105mn across four funding rounds .
“ The fact we didn ’ t really get any funding for the first five or six years was , in hindsight , actually something of a blessing ,” Chen said . “ It meant we didn ’ t have all the pressure that comes with investment , to build revenue and so on , but rather could focus on the things that were important to us like building out our brand , buying Google AdWords and becoming super efficient with things like optimising our pages for monetisation .
We had no money , so we knew we couldn ’ t compete on performance marketing with the larger players . Rather , we were forced by the constraints on us to really focus on building organic traffic and proper media relationships . It was a great foundation .”
Asked how other fintech entrepreneurs should approach the funding question , Chen offered two trains of thought . “ If you want to be a ‘ winner takes all ’ business where scale is all that matters , then frankly it ’ s absolutely rational to raise a significant amount of money and buy your way into the market . If you want to build a brand where you ’ re not competing on scale or price , it makes a lot of sense to bootstrap and build organically . It ’ s important to think long-term too . Are you competing on price with incumbents which have decided not
MARCH 2020