The golden rule of fintech

It does not exist, if it is not scalable

1. Entrepreneurial Spirit
2. Customer Centricity
3. Candor
4. Respect
5. Winning Teams

These are Multitude’s core values, and it is upon these values that we are trying to shape the future of Multitude on. We make sure they are more than just phrases randomly written around the office or on the screensaver of the company PC. We use them as a compass when making daily decisions in the team. How do our customers benefit from this? Will the solution pay for itself in the future? Are we taking ownership of our solution as a team? Those are just some questions related to our core values that help us stay on track.

As the Multitude’s User Interfaces Chapter Lead, I ask these questions in this article, the first in a series of articles that we will be posting on the blog. Our first value and principle (Entrepreneurial Spirit), and its connection to the frequently asked question — How does it scale?

Those of you with an IT background might be familiar with the concept of horizontal and vertical scaling. The fun thing is that there are some parallels to this approach that remain valid also in some other areas of the business. Let me explain:

Vertical scaling

Imagine that you are a fintech company, with a clearly defined market, product, and target group. Yet, you want to grow your portfolio without the need for further expansion to other markets. That means you need to grow your customer base, which is an example of vertical scaling. Techniques that ensure vertical scaling of fintech companies might for example include:

• Automatic scaling of the number of computational resources dedicated to the digital product along with the customer traffic. If your page has hundreds of visitors a day and suddenly, you launch a marketing campaign which brings this number closer to the thousands, you want the page to be able to cope with it.
• Same applies to the involvement of any manual processes. This is the main reason fintech companies are much more flexible than traditional banks. Let us take the approval of the loan, or validation of the customer’s identity as an example. If these tasks require some human interference, with the growing number of your customers, you can either hire more people, pay them more money from the revenue, or let customers wait while the original number of the employees processes the loans. None of these approaches is optimal and that is why the fintech companies try to automate as many of their processes as possible. Vertical scaling of automated approval again requires only additional computational resources, but without the need for the hiring, training, etc. As a bonus — people are not forced to the jobs that are meant for the computers and we can benefit from their other skills which are hard to automate.

Horizontal scaling

Now, things tend to change a bit, if you decide to explore some other markets and grow your business horizontally. Suddenly, you are dealing with completely different challenges that include for example:

• is your solution ready to be easily translated into dozens of languages? Does it consider the specific nature of every nation and its habits? Some markets will react quite differently to the same offer although we are all just humans.
• what are the legal differences between the markets and how will they affect the nature of your product? Are you willing and able to make some compromises? Will it not change the original product design too much, that you will end up maintaining a custom product per each market? And if so, is it still manageable with current systems, people, and processes? Because if not, you are not scaling the solution, but creating a new one.

Startup mentality

Do not get me wrong. We were also a startup once upon a time. We also tried to keep the “street smart” habits, that help us be less rigid and deliver value to the customers faster. Yet, at the same time, we are somehow naturally forced to constantly think about the scaling aspect of any solution as we already operate in dozens of markets and such a position is a bit less forgiving. Hard on us, yet greatly beneficial for the product.

This also translated to another “golden rule” which says that solution must make the money for its own existence. If the cost of scaling the solution is higher than the actual revenue it generates, we always either disregard or outsource the solution. We really try to avoid being the person hammering the screws just because it is holding the hammer. Yes, we are a full-blown fintech company with developers capable of delivering basically anything. Even though we don’t drink too much kool-aid and are not ashamed to buy something than do it ourselves. Of course, with all respect to the business criticality of the solution. Core functions will always be in our hands, as you probably understand why.

Microservice architecture

What might seem a buzzword to some, is the thing that is heavily covering our backs. If a company exists for a couple of years, there is quite a big chance that it is coming from the “old world” of dedicated servers and monolithic applications. We do as well. Yet, after some time, naturally, the complexity, cost of maintenance and other factors bring many companies to the place where we are now.

It is much easier to grow both vertically and horizontally if your tech stack allows that. And trust me, adding resources, spinning up new countries and products, or creating new systems supporting your services is much easier, if you operate in an environment of small services, dedicated to some area of your business, that communicate in a fast, standardized manner, but are still able to grow or shrink independently.

This is the way we rock ’n’ roll in Multitude. As a group of humans, we will keep being imperfect, but we will never stop trying to get as close to perfection as possible. Always thinking about the scaling aspect of every solution is one of the tools that help us in this endeavor. What do you think about it? Do you also perceive scalability as a crucial feature of every solution? Watch this space and follow Multitude IT Labs on Medium for the next article.