“8 Questions with Playfair” ft. Paul Taylor @ Thought Machine
This is the twelfth in our “8 Questions” series — in which we sit down with founders in the Playfair portfolio who share their entrepreneurial journey.
We first invested in Thought Machine, a core banking software provider, in 2016. Since then, the company has experienced tremendous growth, winning household name clients, opening offices around the world, and most recently closing a $200m Series C which values the company at well over £1bn 🦄
Today, we sit down with founder and CEO, Paul Taylor, to hear his story from the beginnings of Thought Machine. We hope this can help other founders and aspirational entrepreneurs in their own ventures.
1. What inspired you to be an entrepreneur?
I started my career in academia, first at Edinburgh University’s Centre for Speech Technology Research and later within Cambridge University’s Engineering department, writing the book Text-to-Speech synthesis. In the late 90s/early 2000s I left academia for the start-up world as I had an urge to build and run my own business.
I went on to start two technology companies, Rhetoric Systems, which was acquired by Nuance in 2004 and Phonetic Arts, which was acquired by Google in 2010. Following this acquisition, I was hired by Google to lead the team of engineers responsible for launching their text-to-speech system — which provides the entire basis of all Google’s speech output.
After three years at Google, I had an itch to start my own business again. The way new services like Netflix and Spotify had disrupted their respective industries with cloud technology was inspiring, and yet the banking industry remained stuck on ancient, mainframe technology. I decided to leave Google to get into the fintech industry and found Thought Machine.
2. Can you take us back to the beginnings of Thought Machine?
We founded Thought Machine in June 2014, and we borrowed a lot from Google’s company culture — with that excellence baked into everything we did. I hired the core team, seven of us, that were the backbone of the engineering part of the company.
The key point was about the middle of 2015 when we came across an opportunity in core banking — we were aware that traditional banks were running on terrible legacy IT.
It became apparent very early on that there was a clear gap, and desperate need, for a modern alternative to their ancient core banking systems. The team worked tirelessly to build Vault, our core banking engine that is now deployed in some of the most innovative banks around the world.
3. What is the hardest lesson learned since day 1?
Perhaps not the hardest to learn, but hard to implement in earnest. Take great care in instilling a culture of fun, and excellence, into the business, and you will reap the rewards. We have benefited greatly from some of the cultural principles we implemented into the business at an early stage. Our commitment to transparency, our debate-and-commit style of work, and our steadfast commitment to product excellence. With some of those principles in mind, we’ve avoided the pitfalls of other fast-growth technology companies, and subsequently delivered a brilliant product to market, with huge levels of client satisfaction, while our team is having a great time, too.
4. What has been your strangest day as a founder?
Throughout the periods of lockdown, our team had grown to more than 500 employees, we had relocated to a large new office in London and expanded our overseas offices. Seeing the team arriving at our new London HQ in Bloomsbury, all together on the same day, after Covid restrictions had been lifted was strange but brilliant.
5. What have you learned from your investors since you first fundraised?
Our first investors were IQ Capital, Playfair Capital and Backed. I have personal relationships with the founders of these funds, before the investors. Those strong relationships have been critical in securing the funding and growing the business.
The essence of my learning is really to focus on product/market fit. I’m not the first person to say this, but it’s critical to have in mind the biggest market possible. It’s great to have a tremendous, talented team — but if after all the work, you’re not making lots in revenue, you have to ask yourself — what was the point? So — focus on big markets, big opportunities — take on big problems. We were bold enough to take on a big opportunity that nobody else was taking on. We said we’re going to deploy entire Tier 1 banks in the cloud — and we’ve done that. So, the lesson here is to think about markets, think about real pain points — and don’t be afraid to back yourself until you’ve solved that big problem.
6. As a founder, what is your proudest achievement to date?
Building a world-class team is my proudest achievement and underpins all of our success. The high standards in the quality of the people we hire has enabled us to build a core banking platform that is capable of running the world’s most ambitious banks — JPMorgan Chase, Lloyds Bank, Standard Chartered, and many others. These extraordinary client wins would not have been possible, without the remarkable team building Vault and delivering on our vision.
7. Crystal Ball: What are your plans for the future?
We recently closed our series C round at $200m, securing our spot as one of Europe’s most valuable fintechs. With this new funding, we will continue to improve the product, expand into new markets, and get more banks live on our platform. With our relentless commitment to product excellence and growth, it won’t be too long until you see Thought Machine announcing more major banks, and taking on new funding — but watch this space!
8. #1 piece of advice to an aspirational founder?
If you’re not having fun in a tech startup, you shouldn’t be doing it. It’s a career filled with passion, with good times and there are plenty of memorable moments. So whatever you do, make sure you can enjoy it.