How to Find, Recruit, and Onboard People for FinTech
In our previous article, we described several of the most painstaking problems CTOs face in their practice. Finding and onboarding people for WealthTech took pride of place at the top of the chart. Fittingly, this extreme problem can be addressed using two extreme strategies, each of which has its advocates and opponents. Let’s find it out what merits and bottlenecks each of them has.
Find a perfect fit—“Cruel and absurd”
During our interview with Aaron Schumm (CEO) and Mark Shilshtut (director of engineering) at Vestwell, they said that a pivotal aspect that makes the company stand out is their recruitment process. The company place huge emphasis on hiring people to tap into each of the business horizontals. They’re apt to stick to the right balance between a skillful engineering team and FinTech domain expertise, which results in an iconic product.
Okay, there doesn’t seem to be anything special about the approach, so why are we calling it “cruel and absurd?” Well, first of all, this approach squeezes the range of possible matches dramatically. Headhunters and corporate culture disconnections compress this range even more. On the flipside, acquisition costs fly up, as does the payroll budget.
Alongside this, hiring only top-notch folks can prove to be a rather unscalable approach. As the company grows extensively, you may need to take recruitment to the assembly line.
Meanwhile, Vestwell aren’t the only FinTech firm that encourage pinpointed hires.
Roland Collins, CTO at InvestEdge, has an impressive lineup of in-house experts that include Masters of Finance, CFAs, and CPAs. Roland noted that many analysts and several programmers are pursuing CFA certification in order to gain a deeper understanding of requirements, client-oriented services, and product management.
Sometimes, talent shortages push companies to look for engineers offshore.
Kendrick Wakeman from FinMason placed part of the company’s team in Europe. The US- and Europe-based teams communicate constantly via Slack, Jira, Zoom, email, and phone. Kendrick also mentioned that because most of the engineering and data validation teams are in Europe, the time zone difference advantageously allows the Europe-based teams to get a jump-start over the US start-of-day on cleaning data and resolving issues.
Nevertheless, no one would say that FinTech knowledge doesn’t make a difference for candidates—here’s why.
Training in-house—Durable and pricy
AI Labs decided to hire people with a strong consumer technology background. They were worried that if they hired more people with financial services backgrounds, it would actually just end up being more of the same. “We wanted people with Apple, Google, Comcast, Amazon, and other consumer-based backgrounds partnered up with some industry veterans,” says Lori Hardwick, co-founder and president at AI Labs.
Seems like a win–win strategy. Hire and then teach. But as always, the devil is in the details:
- When you have to teach an employee, they don’t generate value for your company and product immediately. It will take quite a while until they’re able to fall in line with other teammates.
- If a candidate fails after the probation period, you will have to spend additional time and money hiring someone else.
- You will also have wasted time and money on recruitment and filtering candidates, and taken up the time of other staff that had to interview and train this ultimately ill-fitting candidate.
- Hiring the wrong person can reduce morale within the rest of the team.
Nevertheless, this approach is rather popular among FinTechs, especially those who struggle to find engineers using the “cruel and absurd” perfect fit strategy. The following strategies are the most common among FinTechs that chose training in-house.
Level 1: Lazy strategy
Some companies admit they don’t have any other knowledge transfer practices than simply getting people together. They create separate Slack channels for this, or invite RIAs to their offices during “lunch and learn” events.
Portfolio Pathway’s team members can get involved in other parts of a project in order to see how a particular domain works. Ryan Brucker, the company’s CTO, stated that they have business analysts working closely with staff to give them an understanding of the processes they will reproduce. He also said that it’s important not to go too far with education, and to find ways to encourage learning but not make it an obligation.
Level 2: Writing wikis
Another popular approach among CTOs to turn their engineers from zeros to heroes in financial literacy is building an internal knowledge center. This can be a base for employees only, or a resource that is popularized across a community.
Perry Moutzouros, CTO at Oranj, has built an internal knowledge center or wiki, but this wiki is not only for developers. People on the product team also populate the Confluence knowledge base, making it an important tool for existing staff to reference, as well as a powerful onboarding tool for new hires.
Level 3: Swap roles
Among the ways to ensure developers are in tune with users, direct client interaction is the most efficient, tech heads say.
In addition to internal training, developers led by Patrick Flaherty, CPO at FirstRate, obtain industry-specific certifications such as the Certificate in Investment Performance Measurement.
To ensure software engineers understand the industry, Matt Pistone from Riskalyze facilitates software engineers to periodically shadow training and support calls.
Chris Nicola, CTO at WealthBar, has a mandatory savings account set up for every employee that the company funds as part of the employees’ compensation. This makes it easier for engineers to understand how saving money and investing money into a portfolio works. And what’s more, they get a real sense of what it is they do for their clients.