The Boardroom Path

[00:00:03] Ralph Grayson: Welcome to The Boardroom Path by Sainty Hird & Partners. I'm your host, Ralph Grayson, a partner in the board practice. In this series, we'll offer practical steps and useful perspectives for aspiring and newly appointed NEDs. Throughout its 30 year history, Sainty Hird has recruited senior board members across the City, Industry, the Public Sector and NGOs.

We're now also evaluating those boards, as well as coaching and mentoring those seeking to transition from an executive career into the boardroom. So we'll be speaking to some leading figures in the board advisory and NED world. Specifically, we'll seek their counsel about how and where to spend time and energy to make an effective transition into the boardroom.

The goal is to equip recent and aspiring NEDs with tips, tactics and strategies to be most effective and build a successful career as a board director. In the process, we aim to help you to think more about who you are, how you operate and how you can make this work in the boardroom.

I have been a keen observer as an investor of the need for founders and scale-ups to surround themselves with the right support. The link between good governance, the right advice, and the ability to raise capital and maximize valuation. At the same time, I stressed to new and aspiring NEDs and board advisors the key role that they can play and experience they can gain working with early stage companies.

So I'm particularly pleased that Suzanne Chisti is with me today to talk about some of these themes and help our listeners think about how early stage companies can use their expertise and how this might be a part of their journey to the boardroom. Suzanne is the chair of FinTech Circle. Europe's number one investor network focused on FinTech investments and a leading FinTech innovation platform.

She's also a non-executive director at Crown Agents Bank, a member of RemCo and NomCo and the chair of the ESG subcommittee. In 2024, she was selected among the top 100 women in FinTech globally, and Suzanne is an experienced board member at multiple VC and PE owned and public listed companies. Suzanne is an award-winning entrepreneur and investor with strong technology expertise. She's a judge and a coach at Global Finance and Technology events and competitions, and a conference keynote speaker.

Suzanne is also the co-editor of the best sellers, the FINTECH book, the WEALTHTECH book, the INSURTECH book and the PAYTECH book, as well as the AI book and the LEGALTECH books, an entire library.

Her multiple awards also include the top 32 FinTech leaders in the UK, top FinTech influencer in the world, and among the top 100 FinTech influencers globally. She's winner of the FinTech Champion of the Year Award in 2019. Social Media Influencer of the Year, a top seven crypto experts globally. City innovator, inspirational Woman of the year award. European Digital Financial Services Power 50, a ranking of the most influential people in digital financial services in Europe. And finally, a top five ESG influencer globally and top 100 FinTech influencer globally for Refinitiv. She's also been a FinTech TV commentator on CNBC and is a guest lecturer on financial technology at the University of Cambridge and the Warwick Business School.

After completing her MBA, Suzanne started her career working for a FinTech company before the term FinTech was even invented in Silicon Valley some 25 years ago. Suzanne has worked for more than 15 years, starting with Accenture and then with Deutsche Bank, Lloyd's Banking Group, and Morgan Stanley with experience in both London and Hong Kong.

Suzanne now leads a global community of 260,000 FinTech entrepreneurs, investors, financial services professionals within fintechcircle.com. Suzanne, what a fascinating background. Please do tell us a bit more about your personal backstory, and that'll help set the scene hopefully for a fascinating conversation to come.

[00:04:44] Susanne Chishti: Of course Ralph and great to be here with you in your office. In terms of FinTech Circle, I founded the company about 10 years ago now working ata bank in the city of London. When I realized that the FinTech sector would become so huge and that you as a banker would be much more benefiting from the future of FinTech when you actually were able to invest in the best FinTech startups.

But being in banking, often you're working in an ivory tower where you don't understand and don't see what are the opportunities outside generated and being built by FinTech startups, and that was the vision behind FinTech Circle to really create an investor network where we invest in FinTech startups ourselves.

And so we are a group of about 70 investors. We invest our own money in in great FinTech companies then help those companies to scale. That's the inner Circle. We've got three circles. The inner circle is our investor network. The second circle is our partnerships. We work with the law firms, with marketing agencies, any partner who could be useful for our portfolio companies. And the outer circle is our global community of quarter of a million people now, you know whom we reach across social media channels and all our events and our activities such as webinars which we share online.

[00:06:14] Ralph Grayson: Fascinating, perhaps you could just talk us a bit through the process. So how many cohorts a year, how do founders apply and how do you then get them in front of the investors and hopefully funded?

[00:06:25] Susanne Chishti: Yes. FinTech Circle is the only investor network in Europe focused on financial technology. So we have got very good deal flow. Startups tend to come to us first when they need to raise the seed stage, early stage capital after family, friends rounds are completed. We run three selection days per year where startups apply to our network and then we go through selection days where we choose out of more than 100 applications. We choose the top 16 firms, normally over two day process as part of an investment committee, and then we go down to the top 50% who then are coached in order to get them really full investment ready. Then, all our investors, we all meet together and where those startup founders pitch to usto raise capital. So it's amulti-stage process to really fill out the best, highest quality, entrepreneurs.

[00:07:26] Ralph Grayson: So what does a typical founder look like? This would be seed? This will be pre-revenue, typically?

[00:07:33] Susanne Chishti: Yes, I would say so a typical founder is definitely seed stage, which normally is definitely pre profit. It might be early revenues, sometimes it's pre revenues. Ideally we like to see earlier revenues. You know, we want to see customer traction. But normally it is below 1 million in ARR because that's when the VC phase starts. So we are from basically zero to 1 million ARR. That's where we come in and I would say in terms of typical founder profile, there is not one. We don't have a typical age group and we don't have a typical background of founders. It's a variety. Some are young, you know, in the 25 others are above 50 and are very successful FinTech entrepreneurs. So it varies, I would say, depending on the sub-sector of FinTech.

[00:08:18] Ralph Grayson: Any perspective on whether a particular type of founder is more investible than another? One of my previous guests talked about how, for example, somebody who's on their second or third round of being a founder is perhaps more investible because they've seen some of the war stories,they've seen what to do, what not to do. Do you find a particular stereotype of what works or what doesn't work?

[00:08:45] Susanne Chishti: Yeah, I think that's a very good point. I do believe that the more experience you've got, the better it is. So if you have been a serial founder, you failed maybe the first time around, or you didn't do it as good the exit as you wanted and you do it a second time, you will have learned from your mistakes.

So you will be definitely a better founder the second time around. I also believe as an investor, you know, we look for startup entrepreneurs who are coachable, who listen to our advice, who want to get feedback to become even better entrepreneurs. So these are important things for us to take into consideration before making an investment decision.

[00:09:23] Ralph Grayson: So let's just explore that a little bit further. So good advice. As an investor, one of the first questions I ask a founder is where do you think your blind spots are? How are you going to use external advice to close some of those gaps? And if people come back to me in a narrow minded way, in my view and say, no, I know it all. I know what I'm doing. I don't need a co-founder, I don't need an advisory board. I don't need advice. That's it, I'm out.

I've learned the hard way. I've lost too much money in that respect. So just talk to me about your philosophy, both as an investor and an advisor. In terms of how founders should think, good advice, and conversely therefore, potential board members, board advisors, who are listening to this podcast, how do they bridge that gap?

[00:10:13] Susanne Chishti: I think the key thing is to understand that when you're a startup you don't need to have a board. Versus if you're a public company, you do need a board which basically means that startups and scale-ups for them, a board really has to add value to them initially as a small team. This value added, you know, by new board advisors or board members in the startup scene comes normally in two ways. Either you as an advisor can help open doors to potential customers, if it is a B2B company for example, or you're able to open doors to potentially investors if the company's raising capital.

So that's what startups, definitely need advisors is who can either do one or the other, you know, who can really help the startup with hands-on advice to make the startup more successful. And therefore it helps a lot if the advisor has been an entrepreneur himself or herself. Because he or she has been in the shoes of the founder and has experienced how tough it can be to set up your own company and to grow it to a certain scale.

So I would say that's super important for early stage is really the relationship to the CEO, to the founding team and to really add value to be there. I always say in good and in bad times, you know, often there is a crisis coming and it's very clear to the advisor what is going wrong, and you can give and help them out because you've seen it before. For the founder, it might be the first time that they have experienced something like that. So that's where they, the added value comes infor the founders just having experienced people around, around the team, who have done it before, who have gone on the journey before.

I think the issue of this startups don't have money to spend on advisors or they don't have the money to spend on a board, and so they often then pay in equity. But I would say I've seen startups to know who would have broken up if they wouldn't have had the good advice surrounding them who steered them through difficult times.

[00:12:14] Ralph Grayson: Any views on being a single founder, being a co-founder? Some people, investors and incubators, accelerators, have strong views on this. We don't back somebody unless they've got a co-founder or they've got a chair. Any predispositions from your side on that?

[00:12:28] Susanne Chishti: I would say from my side, co-founders is better in the sense there's less risk just on a single founder risk. However, we do see often, especially early stage, we do see single founders who are looking for a co-founder. That's often very difficult for single founders who had the idea, who develop the business to certain extent, but then looking for a co-founder to scale it up further.

[00:12:50] Ralph Grayson: Suzanne, you sit on multiple private and public boards. What's your perspective on the role of a board and how perhaps has that changed during your time with FinTech Circle?

[00:13:02] Susanne Chishti: Yeah, as a board member of private boards and then FTSE250 boards, it's a huge change of responsibility.In a private setting, you know, as I said before, it really it's about giving hands-on advice to the founder, to the CEO and often being involved in many more decisions and also being in more minor decisions to some extent. Particularly knowing that any decision you make might be implemented the next day because the team works so quickly and turns everything around so fast. Versus being on a public board, it's much more about governance. It's about ensuring that the company is governed in the best possible way, and you've got hundreds of people below the the junior member and the CEO and you've got much more structure in place.

So I would say the key criteria for good board members to be flexible. To be able to adjust your personal style to the situation you're in and to the founder's needs and to the company's needs whom you're working with. So it's very important, I think, to have a good sense that you pick up the requirements and you pick up the challenges the various companies face, and you respond in an appropriate way based on the stage of the company they are in.

[00:14:14] Ralph Grayson: Yeah, I think that's a really interesting perspective. I spoke to a seasoned investor the other day who was talking about the importance of board advisors who have, as he calls it, pattern recognition. So his point being the old adage that history doesn't repeat, but history rhymes. So as an exited founder your added value, to a new founder, is if you do this these are the issues you're gonna face. If you do that, here are the consequences. There isn't a right or wrong, everything's a helter skelter, and therefore that need to have scar tissue as somebody else explains it to me, having learn the hard way. I think that's a really interesting perspective.

My experience also is that venture boards are just different. It's that need to raise capital, shape product-market fit, and make introductions. Yes. But above all, it's the mindset to give up a Saturday night acting as a therapist for a founder, or spend a Sunday evening talking through a cashflow crisis when the founder realizes they can't make payroll next week. What's your experience working with FinTech founders and advisors in terms of that behavioral part of the dynamic?

[00:15:30] Susanne Chishti: Yeah, the examples you gave are spot on Ralph and I remember, you know, one startup which was founded by two co-founders and their co-founders fell out. They owned 50/50 initially, then after we invested it was 40/40, and we as share holders owned the other 20%. Then they fell out and the company could have gone bankrupt right away because if one founder leaves and he still owns 40%, I mean, the company's almost dead because you've got this skeleton on the cap table that you cannot survive. And so we had to restructure the whole company and if you wouldn't have had this good advisors around the founder, the remaining founder, the company would not have made it.

So there are very tough decisions sometimes to be made. As an advisor, you have done it often before, or if you're a group of advisors, one of you has done it before. So that's the importance is really of a diverse team of advisors around you. One might have the expertise in fundraising, the other one has got the scaling expertise, maybe the other one has got the M&A expertise. So to be ready for all eventualities and you can trust those advisors that they are here and give you really objective and honest advice and support you when things really go tough because they've got the best interest in mind For the founder. So that's I think, super value added.

[00:16:52] Ralph Grayson: A lot of new and aspiring NEDs struggle with whether joining an early stage board is the right thing for them. How might experience in an incubator or an accelerator help these aspiring NEDs transition into roles? How does it help them earn their stripes, learn what they solve for, and ultimately get to a paid board role if that's what they're looking for?

[00:17:20] Susanne Chishti: Yeah. I would say if the future aspiring NED is an employee, being a part of an accelerate is the closest thing to do to get there. Because you experience how startups are being mentored and you become a mentor yourself. You learn the challenges of early stage startups. You discuss how they are being solved with various methodologies, various different approaches, and you learn through this experience in a safe environment, which is set up via framework via the accelerating partner.

And I, myself, I am a mentor atone excellent accelerator where I can see how those startups benefit. And I think that's a great way, Ralph, as you said, to aspiring board members to help them learn what startups needs and to add value and I definitely could imagine that some startups, if they like the advice they get and find it very valuable that they might offer the mentor a long-term engagement afterwards. After the accelerator period is finished. So I think that's definitely one way in.

[00:18:27] Ralph Grayson: So beyond the scars of experience, which we've touched on. Any other themes that you might say, if you've got this experience or you've got this sector knowledge, domain expertise, you really should think about entering the scale upboard advisory market? Generalist skills versus specialist skills, sector skills, go to market, ESG, DEI, resilience, these are all board themes at the moment. Any of them particularly relevant or that you would stress from your perspective?

[00:18:59] Susanne Chishti: Yeah, I would say in terms of new NEDs, you know, who want to become or want to become a NED. Founders, what they would appreciate more most is either experience how to sell into a large organization, you know, this enterprise B2B sales skills. How to develop account knowledge. How to create a sales strategy and to build a pipelines on the sales side. On the other side is on the technology platform, you know, how to develop your technology so it's enterprise ready. So any person who has got strong expertise in the technology space or has been a CTO of a large organization before, would have very valuable knowhow for founders.

And the third one is the investor landscape. So if people come from the investment side have got a network among venture capital funds or family offices, private equity firms, and know how funds are being deployed, how decisions are being made and which company to invest in. Those are super relevant elements for founders because normally they do it for the first time. You know, they raise capital for the first time and if they don't get advice, they make so many mistakes or could make many mistakes, which are easily avoidable and will cost them time, distract them from running the business and ultimately don't help them to achieve their goals of being successful and beinga found a nation as we aspire here in the uk.

So I think these are key skills for NEDs to add value on. I would say another skill if it's a B2C startup could be marketing skills. You know, how to market yourself from a PR point of view, from a product point of view. How the product features look like. And I think the ultimate one now, of course, is AI and it's about any person who has got deep AI knowledge, gained in a company where the used already AI. You know, those skills are very, very much in demand by any headhunter and any company in the tech space because most funding rounds nowadays go to AI startups and AI startups know that, and they all need to double down and double click, you know how it's called nowadays, on AI expertise. So they're hiring entrepreneurs, they're hiring tech experts in AI and if they can get board members who have deployed AI successfully, that's of course a huge bonus.

[00:21:25] Ralph Grayson: Let's just pause and think about AI in the FinTech sector. It's in every deck you and I see now. It's part of the marketing pitch. But how genuine is AI in terms of how it's disrupting the early stage ecosystem, particularly from a FinTech perspective?

[00:21:43] Susanne Chishti: I think, I mean, AI issuch a huge change for all of us and such an accelerator of change. So when I think about one successful story of an AI company in Sweden, Loveable You might all have heard about Loveable, but it's a company which was founded two years ago. Within three months, it achieved 17 million in ARR. Now, two years later, it's worth 1.8 billion and what Loveable does, it translates a human language into a new website. So you can tell the AI Lovable, I want to create a new website and they do it for you. So those type of companies are probably most people's blind spots because you didn't even know that this is possible with technology until you see it for the first time, then you see, gosh, that's possible nowadays. And so I would say AI will be a huge change for the FinTech sector, and in two ways.

One is on a positive side because it allows you to do everything quicker. You know, in most FinTech companies, I think, in fact almost all companies I'm talking to at the moment, they use AI. Some use it more on the surface, by using chatGPT or using multiple large language models to research or to code. Others using more deeply by developing their old LLMs or developing their own business models, which have not been possible a year ago without AI. And I would say for the, employment landscape, of course there might be challenges because there will be an impact on jobs. I think long term there will be an impact on our society when jobs are becoming less and more AI will replace people's work. You know, what this means for society at large. But I think for the entrepreneurs themselves, it gives them a huge tool to move faster at lower cost and helps them therefore accelerate their business journey.

So I think it's overall, it's positive for the startups and for society I think we just need to manage it. We need, from an ethical point of view, a transparency point of view, particularly ESG point of view, as you said, Ralph. You know, thepollution data centers cause. I mean, there's lots of information out there. How polluting data centers can beis enormous and any ChatGPT request apparently burns one liter of water. So I think we have to be aware of those consequences of using AI as well.

[00:24:14] Ralph Grayson: Yeah, that's so interesting. I can tell you chair an ESG committee. Back to your public board roles. How do you think AI is gonna change the nature of which board members run board meetings? Think about their contribution on a board? We had Scarlet Brown, recently who's head of thought leadership at Board Intelligence talking about how they think AI can be used to make individual board members more efficient thinking through their 250 page cliched board pack. How board members think about where the gaps are in their strategic thinking and their oversight.

But how do you see AI disrupting the boardroom?

[00:24:55] Susanne Chishti: Yeah, when I look at my public board, we use AI already as a company. So we use it in our operations. But because we are PRA regulated bank we make sure that we have got always a human in control still. So we don't let the AI do its own thing, but we've got the human on the top or the human in control.

In terms of on the board itself, I would say we don't use AI in board meetings yet. But as part of preparing for board meetings, I found myself already that when I want to discuss what are our competitors doing in a certain space and I ask ChatGPT, I askwhat do other payment companies in the cross border space do in this area? And you just get what's publicly available and it helps you just understand, from a competitive point of view, what's going on. I do think that board members probably use AI to prepare themselves for board meetings, but we don't yet have an AI as an AI member, because I know we talked about that might be the future, that there might be an AI bot, you know, as part of a board meeting. So we don't have gone so far yet.

But I think it'll be more helpful in crystallizing the essence of board papers. In the future, it probably will help to write, of course, meeting minutes. Nowadays can be written by AI much more concisely than in the past, done by people. So it'll be a huge step forward. But the key thing, of course, has to be complete confidentiality. It has to be 100% trustworthy, that nothing gets shared with anybody, and I would say the other thing is that being, you know, an ex-banker, our regulators want complete transparency. So you don't want a black box, you never want any AI making a decision where you cannot justify or you cannot explain why the decision was being made in this way.

Whenever you think about using AI in a financial services context, you have to make sure that you are completely aware not to implement anything which is not transparent or could be unethical or could make any risky decisions, which you don't want to do, obviously.

[00:27:08] Ralph Grayson: We touched on in an earlier conversation, the data privacy part of that. If you are putting part of your board meetings into ChatGPT then it's shared, it's public, right? And then particularly from in a regulated environment.

Be really careful.

[00:27:23] Susanne Chishti: Yes, 100%. Completely careful. So don't any board member listening. Don't put anything on AI. You know, it is very important because what I just also found out last week, for example, they said when you share something on ChatGPT, the sharing link now gets indexedapparently one week by Google. So complete, separation, and there must be a firewall and only use AI which is completely owned and safe by the company you're on the board of. Yeah, very important tip.

[00:27:51] Ralph Grayson: Susanne, I think that goes back to the point of what knowledge do you need to be an effective board member, particularly in your first board role? And again, one of the cliches is you can't be a board member until you've been a board member. What's your perspective on this? What do you feel is the need for any prior executive board experience orgovernance perspective and how should other board members think about onboarding for new and first time board members?

[00:28:22] Susanne Chishti: I think when you are a first time, or when you want to become, a first time board member, I think the more experience you've gained, the more varied experience you have gained the better. And then I would say it is about really being interested in the sector you want to advise on. So be up to date with new trends, new industry trends, new developments so that you are up to date and can have a very interesting conversation with the CEO and the founder about his or her sector.

And then I would say a huge important skill is emotional intelligence. It's emotional intelligence, getting along with people, being able to share ideas in a non-threatening way. Being able to give feedback in a kind way where the person you provide feedback to feel support, it feels heard, feels you've got the best interest in mind. So it's all about really emotional intelligence and then the knowledge and expertise combined and ultimately I think as a board member,you shouldn't have an ego. Because it's not about you, it's about them. It's about the company, you know, you want to help.

I would say it's a multiple factors, come to together and then to learn that at some stages in a company you have to be more active in other stages. You can be more passive actually, if everything goes perfectly well, but if everything goes very badly, you might have to fear a lot. And as a chair you might have to step in and becoming a co CEO, almost working alongside of the CEO. Something happens to the CEO, you might have to run the business for a while as a chair. So it really depends. How actively involved you get depends on how good the company's run and how well the company's performing.

So it's important to make sure that you've got enough time. I think that's important for upcoming board members to know that you've got enough time, enough capacity, and enough buffer zones that if something goes wrong, that you've got the buffer to really allocate time to the company when they need it and that you're not overstretched.

[00:30:23] Ralph Grayson: So let's just stay with this boardroom behavior theme for a little while. When I'm coaching perspective NEDs, who are looking for advice from that transition out of an executive management role, which is all about overt demonstrable leadership into the boardroom, which is much more, as you've touched on, about influence, about collective. As somebody who's no doubt interviewed many NEDs, how do you frame the questions that make you comfortable that this is somebody I want to be on a board with?

[00:30:59] Susanne Chishti: It's a tough one. It's a tough one, Ralph. I would say,when we look for NEDs, you know, and I'm part of the nomination committee, so as you said, I interview lots of NEDs,So we are looking on one side, we are looking for deep domain expertise. That's super important because if we know they can add value on a topic basis. In terms of their personality, we are looking for somebody you enjoyed to have a conversation with. I think that's really important. You know, somebody you enjoy speaking to and we are looking for somebody who is a team player as a NED. Because ultimately you don't run the show, you know, you're part of a team. You want to have a good collegiate environment. So we are looking for those factors as well, and then we are looking for the way, in an interview somebody responds to our questions, somebody how they ask questions to us as well, and if there's a cultural fit. I think that's really important.

I think the other important thing is humor. You know, it's something really important. I think if somebody has good humor, has got afriendly personality, it helps enormously in all situations in life. Equally, I think if somebody, of course, like you said, if somebody has been on a board before, has experienced working with startups before, of course we know that it is easier for them to therefore provide guidance and provide help.

But I would say for first time NEDs, as long as they show these characteristics of openness, willingness to learn, and a willingness to embrace change quickly, they will be very welcome at new boards and their advice and expertise will be able to gain and add lots of value to entrepreneurs, both, early stage, middle stage, and then later on listed boards. And again, listed is also a full range of AIM listed, you know, very small boards where companies can be very, very small, to super large boards, you know, of valuations of 1 billion plus. So there's lots of opportunities out there.

[00:32:55] Ralph Grayson: The role of a board member is getting ever more complex in that respect. People talk about the need for a t-shaped board member, ie broad governance and sectoral expertise as a member of the board team, but deep vertical experience in terms of their particular expertise on the board. How do you think about that? So if you have somebody who's solving for cyber and AI, but they are so technical, they can't add value in that broader board conversation, how do you try and get that balance right, as a member of Noms committee?

[00:33:29] Susanne Chishti: Yes, I love the Ts shape analogy because such a powerful one. And I think often when I look at boards, you can see that, well, let's say one person is a tech expert, one is a lawyer, one is an equity analyst in the past, or one has been an industry CEO. So we've got these varied backgrounds which we bring to the table. But the commonality of all of us is that we are interested in helping the company succeed, and we are interested and we are able to talk about different strategies, different approaches, and what it means is that you need to be comfortable to talk about areas. So to ask the right questions in areas where you don't have expertise in. So we talked about cybersecurity as an example. So somebody who has never been or done anything in cybersecurity still should not shy away in the boardroom to ask very basic questions because often those basic questions are the toughest ones to answer and often are the best ones. Because they help other board members to also appreciate you know, the complexity of a certain area.

So I would say it is important, number one, to be able to ask and to be interested in areas which are not your expertise. But equally, if it's your area of expertise, you must be able to communicate it in a simple way. It's very true what you said. If your areas very deep in, let's say, quantum computing, and as we know, quantum computing is an area which is highly complex. You must be able to explain it in an easy way where anybody who has not studied physics and is not a quantum expert understands your summary and your conclusions.

So communication skills I think, are a key requirement for board members. Both on the topic itself in terms of industry expertise, but also in terms of discussing difficult topics and researching in a group, you know, what are the options you've got as a board and then weighing up the pluses and minuses of each scenario and each option before you decide jointly, what's the best strategy for the company to go down on. Being aware that you looked at everything, to know that you've been investigating what's possible but you chose the best path and you're all agreed to feel comfortable that that's the best solution and the best next step.

[00:35:48] Ralph Grayson: Before we leave the subject of behavior. You've got the most incredible range of experience from startup through to PLC boards. Most founders, in my experience, think their success is just almost mechanistic. Get the product market fit right. Get the fundraising right. Get the hiring right. We've solved for it.

But a theme on a recent podcast we had with Rupert Jones was how for a startup company, in particular, to successfully grow the founder must also scale up by which he meant how a founder needs to think about culture, recruitment and management style.

I'd love to get your perspective on, how you think a founder scales and in particular that evolution from founder where you are block and tackling on everything. You are running everything. To the point where you are a CEO and you have to delegate and you have to manage a team around you. Any perspectives on what you've seen in good and bad behavior, success and otherwise, and in particular how a board can help with that maturity of the executive team and the founder in particular?

[00:37:04] Susanne Chishti: Yes. I would say, we almost divided in revenue stages, so we say this one phase is zero to 1 million. So the founder who starts his company, you know, the goal is to, generate revenue and then to grow it. The ability to grow a business from zero to 1 million requires a founder who becomes a CEO, and the CEO in this context is Chief Everything Officer. So you initially, with your team, you do everything and then you try to, as you said, to find product market fit, to scale up your revenues to get to 1 million. This is the initial hardest phase for a founder.

Then the next phase is from one to 10 million, which requires much more structures. It requires that you set up a sales team, probably a marketing team, you've got operational support, and some entrepreneurs like that, and are able to advance and are able to grow with the new responsibilities and others don't. And I think both is okay. The important thing is that the founders who don't want to or who enjoy some of them just love this first phase, from zero to one and don't enjoy any more than one to 10 or 10 to 100 million, that they realize that's not their strength, and they can step back and let somebody else come in and they, of course, what we see sometimes when VCs come in that the CEOs who have gotten outta VCs and the cap table stepped down after two years and become a member of the board, and they have higher than a professional CEO to run the business and scale it up. So we see that happening a lots of time.

But I would say as founder CEO the key thing is if you want to do it, and if you've never done it before, if you've never done one to 10 million, for example, you want to do it with your business is to get expertise. To get as much of coaching and coaching. There's so many fantastic coaches out there.You get expert advisors who help you on this next journey of growth. You experiment, you take their advice, you see what works best for your company. But equally because as a founder, you of course, often the most of your wealth is concentrated in your equity in this company. It might be in your interest at some stage, if you think you've reached your limit to step back and become just a shareholder, become a board member, let somebody else run the business. If this other person can make your business a 100 million revenue business, because then you will be much wealthier ultimately, and better off because you own still a large portion of the shares of the company.

So I think that's the self-awareness part, which is required of a good founder, that they're self-aware enough to realize when have I hit my ceiling or when I don't enjoy anymore the day-to-day operations because it becomes too bureaucratic at some stage and that's why I step back and then enjoy my journey so far.

Do you know, I think that's a perfect, successful ending as well for entrepreneurs. So not everybody has to do it all the way until exit. I think that's very rare. That's probably the more, the exception of the rule.

[00:40:09] Ralph Grayson: Yeah, I think that's a great perspective and something that founders often struggle with. When's the right time for the business to pass the ball and bring in an external CEO and in particular to try and do that before an investor board loses confidence in them or feels they've outgrown it or whatever the external pressures are.

Suzanne with the time is really running on. What final tips and advice would you give our listeners who are thinking about starting out on their board careers, either on a public or a private board?

[00:40:40] Susanne Chishti: Yeah, I would say one of my tips is you know, if you think from a management point of view sometimes leading a firm means that you can't look back and don't rely on your past experience too much because your biggest impediment for the future might be your past success. The future of requires completely new strategies to be successful. You know, an important thing that as board members, we look at our experience, but we also have to be very cognizant that the future, especially now with AI, will require completely new skillset. So we have to be, I think, self-critical, in order to adopt and to change constantly.

I would say the other one is a board members that we need to challenge our leadership teams to ask them, how can you improve by 10x? It's not anymore, how can you improve by 10%, but how can you improve by 10x? Because it forces the management teams to do things differently. You know, really try to think how can you use AI to really increase revenue substantially to cut costs? And equally very important to retain the morale of your employees, to take them on the journey, make them understandwhat the purpose and really the excitement of the company is and why it is important to come to work every day. So, and I think as a board, you've got this responsibility for employee engagement as well. So that's really key. And I would say the worst thing for a leader is not to understand reality fully. So important to embrace change, embrace AI, and be really crystal clear to what goes on, in our world today.

And I would say tips from a startup point or for entrepreneurs or for NEDs who want to work with startups, there's an immense opportunity for FinTech startups currently because requirements are constantly changing. So they can adapt, they can use their AI, and we see, you know, on a positive side, we see lots of US funds now being set up and investing across Europe. Because European companies, UK companies are valued often half as highly as their US counterparts. So there will be an influx of capital in the UK.

I just met last weeka new UK PE fund, and they are just launching now and their minimum ticket size is 50 million. So they just will invest in the UK in Europe, nowhere else. And so I think there's a big opportunity to build large ARR businesses and these business models very quickly with AI. I do think for any startup and also for any board member, it is mandatory to use AI because the adoption of an AI strategy is being demanded by investors. So that's really key and therefore you need to understand, you need to learn, you need to play around with it yourself you know, as a board member.

And as an investor myself, you know, I review my portfolio companies and their effectiveness on a regular basis by evaluating how AI is being used to move faster. To achieve more. These are just practical things as a board member you can do just to be always on the top of your game. Then it's also most fun for you because you can really add value and the companies will benefit most from your advice.

[00:43:52] Ralph Grayson: Growth mindset as people talk about for both founders, CEOs, and board members, and the crucial importance of continual coaching and development, I think are key themes there. Suzanne, thank you so much. If people are interested to find out more about FinTech Circle, where do they go?

Where can they find out more?

[00:44:10] Susanne Chishti: So on one side it's our website, fintechcircle.com. They can visit on our website. They can also join our LinkedIn group, which has got about 140,000 members now on LinkedIn, it's also called FinTech Circle, and of course they can follow us on Instagram, on X. We are on Blue Sky now and on LinkedIn where we post about FinTech trends and if people are in the UK and in London, they can of course join our FinTech Circle drinks events, which we do on a regular basis.

[00:44:41] Ralph Grayson: Super. Suzanne, thank you so much for your time. It's been a fascinating conversation.

[00:44:44] Susanne Chishti: Thank you so much Ralph. Great to be here.

[00:44:47] Ralph Grayson: I hope that you've enjoyed listening to this podcast and have found it helpful when thinking about how to approach your own path to the boardroom. If you would like to push this a little bit further, Sainty Hird runs a bespoke one to one programme designed specifically to this end. For more information, please visit our website, saintyhird.com, follow us on LinkedIn, and subscribe to the Boardroom Path to receive new episodes. Thank you for listening.