Naaz Scheik of SoftPak Financial Systems On 5 Things You Need To Succeed In The Modern World Of Finance & Fintech

The biggest thing to not burning out, is having a good work-life balance. Any corporate individual would know mixing personal responsibilities with your professional life never works. Working eight to ten hours a day or fifty to sixty hours weekly is fine if you know your limitations. What has always worked for me, and is extremely important, is delegating tasks. Accepting that not everything is under your control and being able to trust in others is the key reason your company will thrive. Control limits success and allowing yourself to trust like-minded individuals will make you start seeing growth, allowing you to have a succession plan as well, if say you or any senior management were to leave in that regard.

As part of my series about the “How to Navigate and Succeed in the Modern World of Finance”, I had the pleasure of interviewing Naaz Scheik.

SoftPak Financial Systems, Inc founder and CEO, Naaz Scheik, started his career as a quant analyst at Wellington Management in Boston. His firm was founded with the goal of enhancing financial technology software by making it more user-friendly and offering analytical tools to portfolio managers. The firm employs more than 150 people globally, and under his direction, it has developed from developing custom software to placing consultants and producing packaged software. He also attended the University of Karachi and Tufts University in Massachusetts, where he earned a master’s degree in mathematics and physics.

Thank you so much for your time! I know that you are a very busy person. Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?

My name is Naaz Sheik, CEO and Founder of SoftPak Financial Systems. My career began working as a quantitative analyst at Wellington Management in Boston, where my skills in financial analytics and portfolio management were sharpened. In 1994, I founded SoftPak with the mission to revolutionize financial technology software, making it more intuitive and powerful for portfolio managers.

With a Master’s in Math’s and Physics from Tufts University and the University of Karachi, I have grown SoftPak to more than 150 employees worldwide. Now, our technology processes over $500 billion annually for some of the world’s largest investment firms.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?

I’m not sure if this is really a funny mistake, but many mistakes were made in the first few years of SoftPak including marking projects completed without really ensuring their quality was checked was one of them. In the beginning, we would let the developers do the project and ensure it was QA approved from their side. However, we would come to find out that to avoid any repercussions the developers would hide some of the mistakes they made, allowing for awkward conversations with the client. We, of course, learnt our lesson later and hired a separate QA team to ensure quality was never compromised.

Are you working on any exciting new projects now? How do you think that will help people?

I am currently working on projects that are on the forefront of software development, as mentioned previously. AI and genetic algorithms are indeed going to change a lot of what we see in the fintech industry, quantum computing on the other hand could take some time since it’s too difficult, and most don’t even have access to quantum computers.

Thank you for that. Let’s now shift to the central focus of our discussion. Extensive research suggests that “purpose driven businesses” are more successful in many areas. When your company started what was its WHY, its purpose?

SoftPak, started with the simple goal of providing software development services for our offshore clientele. Looking at competitors and how they were opening similar companies in India, and Bangladesh with clientele in the UK, United States, and Germany, something just clicked in me that said we need to specialize, apart from being just a software house. Thus, our switch to quantitative portfolio management. This specialization through my extensive research gave us an edge over our competitors, allowing SoftPak to not only stay steady during economic downturns but also thrive.

Do you have a “number one principle” that guides you through the ups and downs of running a business?

My number one principle is always scaling growth. Most businesses make a major mistake early in their tenure by growing too fast. Scaling the business’ growth is vital to ensuring it can withstand economic downturns, since the market has its ups and downs. Laying off personnel when times get tough and ensuring you don’t overspend on your budget allocations can make the difference when it comes to the continued success of your business.

If a fellow business leader would ask you for advice about whether to bootstrap or to look for VC capital, how would you help them weigh the pros and cons of that decision?

VC capital and its importance cannot be understated. Bringing in that form of capital allows your business to expand fast, and there are many ways you can do that. Organically, which despite being a popular method, normally takes a long time. I personally have been relying on organic growth for a long time. If a fellow business leader should ask me for advice, after everything I’ve learnt in the past thirty years. I would look for VC capital early, within the first three to four years of my business to scale growth as fast as possible.

What measure do you use to determine the value of a company? What advice would you give to other leaders about how to get an optimal evaluation of their business?

Two standard things are my measure of value, turnover-rates and profits. Figuring out what your business’s average sales and margin values are, gives you the tools needed to evaluate your value for business. Growth prospects, on the other hand, are a good long-term valuation for company growth, allowing you to see what increasing revenues, profits, and your overall company trajectory in the coming years.

What would you advise to a founder who initially went through years of successive growth, but has now reached a standstill. From your experience do you have any general advice about how to boost growth and “restart their engines”?

When growing a business, a lot of entrepreneurs tend to grow vertically, or in the same industry by expanding their existing clientele base. Another often overlooked growth opportunity is horizontal growth. If you feel your industry is getting too saturated, you should start to look at industries closely related to your own for example, in the industry of portfolio management a closely related industry would be commercial banking, insurances, and venture capitalist corporations. Applying portfolio management, or your own niche in these fields allows you to create new vertical growth opportunities.

What are the most common finance mistakes you have seen other businesses make? What should one keep in mind to avoid that?

Expanding too fast is one of the biggest mistakes any business could make. Many businesses have failed entirely just because they expanded too fast. Any growth should be controlled, and at the first sign of any sort of financial issue, a leader must make the hard choices and be ready to cut down on any sort of expansion, quickly and immediately. Whether it be staff or locations, a leader must be able to outweigh his or her business costs over all else. Many may see this as a drastic step but looking at the cost of staying afloat versus laying off a few staff members should be all the incentive you need.

Ok, here is the main question of our discussion. Based on your experience and success, what are the five most important things one should know in order to succeed in the modern finance industry? Please share a story or an example for each.

With any business, the main question you should be asking yourself is; “What is the main value you add to your business?” Sourcing cheap products and expecting to turn a profit isn’t the only requirement for a successful company. Understanding what value you add to your business is the true measure of success. Another key indicator is having a strong plan to put it all into practice. Cost competitiveness also allows you to gain an advantage over your competitors, delivering what you promised for half the cost is always a win in any industry. In today’s finance industry you should always ensure not to over deliver or under deliver either, finding that middle ground essentially makes or breaks your business growth. Finally, adhering to a strict timeline for any sort of business cycle. Over the years I’ve seen numerous businesses go under simply because they could not adhere to their timelines, or they were too unrealistic to progressively scale their growth.

Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?

The biggest thing to not burning out, is having a good work-life balance. Any corporate individual would know mixing personal responsibilities with your professional life never works. Working eight to ten hours a day or fifty to sixty hours weekly is fine if you know your limitations. What has always worked for me, and is extremely important, is delegating tasks. Accepting that not everything is under your control and being able to trust in others is the key reason your company will thrive. Control limits success and allowing yourself to trust like-minded individuals will make you start seeing growth, allowing you to have a succession plan as well, if say you or any senior management were to leave in that regard.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I always thought of starting a class in Pakistan, promoting entrepreneurship and starting a small business. There is a lack of support systems for entrepreneurs in Pakistan and I would love to be able to share what I have learned over the years to young people looking to start a business with seminars to discuss the difficulties, and methodologies to starting and running your own business. Promoting this kind of learning would be very beneficial to the country’s continued development.

How can our readers further follow your work online?

Readers can always follow me on Linkedin, I use that for all my professional work.

This was very inspiring. Thank you so much for joining us!