Field Notes from Startupfest 2023: Insights and Inspiration from Montreal

For the second year in a row, I had the privilege of attending Startupfest in Montreal, one of the most community-focused tech events I've experienced. Last year, I spoke about the various models and ways venture studios deliver value plus reconnected with some fantastic folks. This year, I was thrilled to return as a mentor.

What's notable about Montreal's environment, especially after recently writing about the Brooklyn tech ecosystem, is how distinct it feels. A Canadian investor asserted that while U.S. founders often tell grander, more compelling stories, Canadian founders tend to feel they need to be more grounded in actual accomplishments. I thought that was an interesting insight and kept my ears open. At every event, I was struck by the depth of experience of all the speakers and mentors; but I also noted that so many of the founders were off and running, operating young but growing businesses. There were almost no entrepreneurs there slinging good pitches based on vaporware and jargon. That investor was onto something. FWIW Startupfest’s organizers have been deeply embedded in tech for years, and it shows in the community they’ve built. Programming reflected an incredible interplay of technology and societal trends over decades, with conversations led and facilitated by luminaries.

Several big ideas kept surfacing during the event, and I wanted to capture three that particularly stood out to me:

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1. Truth in AI

There was a fantastic panel about Truth in AI. The discussions really got me thinking about the implications of hyper-enabled humans with bionic powers (aka the Bionic Consumer to gather, synthesize, and apply vast amounts of information to decisioning. The critical question becomes: Is the information I'm using true, and where did it come from?

Maybe best poised to tackle this question are folks like Shingai Manjengwa and her team who are reimagining applications of Blockchain to solve this problem. We need smart mechanisms for consensus to govern – not just monetary provenance—but ALL IP. Its promise is to help us with a simple question: Do I believe the information or transaction I’m observing is real? Do I understand its origin? As AI agents operate on our information, trust in AI itself and its conclusions becomes paramount. As more of us turn to AI for perspective and interpretation and then turn around to pass them along…how will the next person trust us? Our judgment in AI selection? Our sources? This need for trust and transparency will only grow as AI continues to evolve.

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2. Evil Enough

Startupfest organizer and OG startup vet Alistair Croll and rockstar brand strategist & marketer Emily Ross, co-authored a book called "Just Evil Enough," which rethinks marketing for the attention economy. They explore how certain individuals find loopholes and hack systems, like Farmville's meteoric rise to 72 million users or Kraft Mac & Cheese selling a million boxes a day. The book analyzes and deconstructs various playbooks that can help us rethink marketing strategies to discover advantages and ultimately hack the system.

For me, the fascinating part was discussing with them where the lines were? How far is too far? And maybe most importantly to me, how might we subvert these tactics for positive impact. Often, I talk about “hacking” companies to help those companies do good while making money, in spite of themselves. 

I wonder if there's something around “good enough to be great”...collabo for next book y’all? 

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3. Champions, Not Charity

I had the great fortune of sitting next to Deborah Price, a member of the Board of the National Indigenous Fisheries Institute (NIFI). The Institute aims to promote national consistency and standards across Indigenous programs and practices related to fisheries, aquaculture, oceans, and aquatic management. The Board of NIFI includes various regional and national Indigenous executives who collaborate with communities, regional organizations, and governments to enhance the potential and benefits of these programs for Indigenous peoples across Canada. She had just spoken about sustainable business and connecting First Nations people to the broader more sustainable economy. Her unambiguous statement to me when I asked her what she saw as the biggest opportunity for impact: “I came to do business and make deals”

Not charity. Not handouts.

I missed her on stage but our convo was a masterclass. Deborah's focus on sustainable participation—empowering communities that have been commercially and economically marginalized—was poignant. She spoke about giving communities not just a seat at the table but the means to build their own tables, define production methods, and engage in deal-making, monetization and their own community reinvestment. This resonated deeply and aligns with my belief that doing good and good business need to become indistinguishable. Targeting new markets aimed at serving traditionally commercially marginalized populations is a sizable business opportunity.

In Summary

Startupfest in Montreal was an amazing experience once again, filled with incredible community, a vibrant ecosystem, and fresh, diverse perspectives. I'm grateful for the opportunity to participate and hope to continue to build bridges and portals between NYC and Montreal.

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Big shout outs to Rebecca, Alistair, Suchi and the whole StartupFest crew! I’m already looking forward to next year.

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Hi there,

What if I told you that Primary Banking, as we know it, was dead?

Since the old days, the “gold standard” for growing a consumer banking businesses has been relationship banking.

Become the one institution a household primarily relies on. Win outsized share of wallet. Easy to understand. High ROI if you got it right. Primacy for the win.

The playbook was simple:

1. Deliver decent onboarding: Make it easy to walk into a bank and open a primary checking or savings account. Incentivize connecting that account to payroll, and get direct deposits every two weeks.

2. Create consistency: Provide seamless coverage across products with a skilled account manager and a good CRM (customer relationship management system). Cross-sell into higher margin products and services like credit cards and wealth management.

3. Remain relevant: As customers approach major milestones (Getting your first car? Buying a house? Saving for college?) put relevant offers and rewards in their path and cross-sell into a multi-line relationship.

Done right over time, you’ve increased loyalty, earned sticky deposits that provided a low-cost source of capital to grow a lending business, and transitioned a single account holder into primary banking relationship.

But, a few things have changed that are making it harder to predictably win “primacy.” Perhaps even more concerning for institutions, is the possibility that idea of primacy itself may be gone for good.

So what’s changed/changing?

Competition and fragmentation of deposits

A near-zero interest rate environment and explosive FinTech innovation created an unprecedented level of competitive pressure on every part of banking over the past 15 years. Almost overnight, consumers could send money faster, borrow more cheaply and — even with small balances — be offered superior interest rates just for opening up new deposit accounts. Ultimately, while most consumers did not move all of their money to challenger banks and digital wallets, a shift in willingness to have multiple relationships did occur. From new banks, to payment apps, to embedded finance players, consumers suddenly had lots of new places to stash deposits.

More informed consumers with real needs

I recently wrote about the rise of the “bionic consumer” in the context of the shifting power dynamic between providers of commodity services and their customers. One big takeaway was that it’s now easier than ever for customers to understand and optimize all of their purchasing decisions:

Do I have the right financial products (rate, reward, cost, service, values, etc) given what my needs are today?

The even bigger takeaway is that consumers will be able to passively optimize their financial lives; their AI money “agents” will hunt, compare, and analyze choices and changes in the market for them 24/7 across a huge set of factors and dimensions.

Better informed customers navigating a challenging economy will mean more demands on every provider and a greater portion of deposits up for grabs.

Open banking and money servers

As US regulators establish the particulars of what open banking will look like, one thing seems clear: much like in the UK, the advent of open data and seamless account-to-account (A2A) money movement will likely increase fragmentation and impact share of dollars kept in the “primary banking” relationship unless that provider is serving up the very best rates.

How?

1. Ease of A2A money movement
2. Rules-driven (aka algorithmic) money movement based on risk appetite, timing of different cash flow needs and yield

In the future your average family may break *all* of their money up into buckets they need to access over 15, 30, 60 and 90 days+, with AI “re-balancing” their money all the time to optimize.

Sounds a lot more like web servers than static financial deposits, doesn’t it?

While this future of an always on, always optimizing version of consumer banking might not be a reality tomorrow, it feels almost certain that financial institutions (FIs) of all sizes will no longer be able to rely on steady paychecks (we didn’t even touch the explosion of 1099 income) into a direct deposit account as a predictor of primacy.

So what, then? A new time calls for a new playbook.

Enter the  “Command Center” strategy: Become the very first place consumers turn to when they are even thinking about what to do with their money.

The Command Center strategy has a few key elements that banks will need to address:

• From walletshare to mindshare: Moving from simply being a payment method or a place to store money to being a trusted partner and co-pilot
• Lead with help: To be a partner, banks will need to create value in non-traditional, non-transactional parts of the journey. Don’t wait until a person is ready to buy a house to compete for their attention with rate and rewards… Give them tools and experiences to make and manage their long term buying plan.
• New kinds of partnership models: Consumers have a large and increasing number of FI relationships. Rather than try to get those consumers to switch completely in service of the traditional primary relationship, smart institutions will leverage their institutional platforms to convene partners and create robust experiences; capturing commercials even when they don’t fully own the journey end to end.

We’re all going to need to learn new tricks to serve tomorrow’s customers in a dynamic market with new rules:

“I didn't come here to tell you how this is going to end. I came here to tell you how it's going to begin.” - Neo

You ready?

Cheers,

Ron J Williams

Partner at Co-Created, Empire Startups Contributor

Contact our team to start a conversation!

The Assignment

Citi Ventures is the ventures and innovation arm of the bank. The team's remit is to help catalyze innovation and look for opportunities to accelerate growth. Spotting new and emergent trends and understanding the behavioral, structural and technological changes that will impact the business is part of the mandate.

The product development team wanted help to build a business case and launch a digital first product that addressed a financial pain point for families.

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The Solution

Starting with ‘Modern Family’ as the foundation, Co-Created kicked-off the ideation process with a week-long intensive workshop with specialists from the consumer bank product and tech teams, external subject matter experts, and seasoned tech founders. Co-Created then did a customer discovery deep dive – bringing in real people (consumers) to hear directly what challenges they were facing and what services they wanted from their bank.  These sessions, complemented by prior research, helped our team create a half dozen family 'archetypes' to broaden our exploration of problem categories, market segments, and consumer needs, in order to ideate across a range of potential solutions. In short order, our process facilitated and forced prioritization to land on the top three concepts. At the end of the week, we delivered three high-fidelity pitch decks (“Lean Product Plans”), each one for a discrete, disruptive concept, one of which was a way for co-parents to seamlessly manage and track shared financial expenses related to their children.

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Co-Created then worked with the Citi team to drive the in-market validation process. This first phase we call “signal mining” – a sprint (in this case 10 weeks) designed to help us get closer to customers and validate the critical assumptions underpinning the concept, primarily which problems and value propositions resonated most with different target customer segments (co-parents in this case). Following this phase, with strong signals (validation) around concept resonance and cost per lead, Co-Created moved to the MVP phase in which they designed, built and launched an iOS app in the app store under independent (non-Citi) branding within roughly two months. Over the following four months, Co-Created iteratively launched marketing tests and product designs to progressively improve key metrics. The product launched first as a simple free collaboration tool for co-parents. Despite intentionally not building a fully featured app with money movement, Citi saw unprecedented monthly engagement per user compared to its own mobile app.

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Outcomes

• 4,000+ downloads in the first two months after launching with limited marketing. 
• Executive support for a spin out in 2021 – Onward. 
• Onward then went on to raise over $13 million across its Seed and Series A fundraises, including investment from the Citi Ventures fintech team
• A new playbook for the Personal Banking business

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How can we help you?

Contact our team to learn more

It’s our job to understand the new and emerging signals we are seeing in the market and to help our clients and partners spot opportunities for growth. As part of our “Field Notes” series, our partners share what they are seeing and hearing at key industry events plus their💡quick thoughts.

Co-Created Partner, Ron J. Williams attended the Brooklyn Founders and Funders event during NY #TechWeek at the Domino Sugar Factory in Williamsburg. The event brought together founders, operators, and investors to hear about the latest trends and enabling tech that are driving innovation across the ecosystem. Event hosts included Elana Berkowitz of Springbank VC, Aubrie Pagano from Alpaca, and Elliott Robinson of Bessemer Venture Partners, among others.

Below is just a snapshot of what he heard on the ground (and, as always, his hot takes) –

1. Is Brooklyn in the House? Without a doubt. ;) The Brooklyn venture ecosystem is thriving! There was an incredible diversity of venture focus from health and wellness to fintech, sustainability, learning and development, adtech as well as a healthy number of folks thinking about what I now call “famtech” (solutions focused on easing the burdens around raising a family, providing for a family and keeping everyone (including yourself) healthy.
2. Impact, impact everywhere. I was excited to hear about the unapologetic interest in commercial ventures that improve the human condition. I got to join several conversations about how parents are navigating the process of getting advice and/or diagnoses for children who may be displaying learning or developmental differences, and the incredible challenges around that. I also got to hear about some of the incredible work the PINE Program team (a venture out of NYU) is doing at the intersection of building more inclusive classrooms (for kids of all kinds with learning differences, starting with ASD) and the K-12 professional development (“PD”) ecosystem. Fun fact: we spend more than $10B a year on PD in US public schools even though methods for training teachers haven’t been updated in 40 years. 
3. Keeping it Real..Estate: I talked to several founders and Commercial Real Estate professionals who are actively reimagining the future of built space; esp inside an evolving work ecosystem. One of the more interesting questions that kept coming up was around trends on residential vs commercial space. Folks keep wanting to move here to *live* but in a post-covid world, space needs to be flexible in terms of usage and ease with which it can be reconfigured. One founder was talking about leaning into the idea of “3rd space” (i.e. not home, not office but other places you access as needed) as experiential. Instead of the utility of office space, might I wind up exploring the city differently if I could plan where I worked around local delights? Maybe even with my girls on daddy-daughter office days (read: camp or school out and I’ve got no childcare), we can turn work trips into adventure time.

In summary, as a guy who almost left Brooklyn in 2008 to head out west because I wasn’t sure there was enough vital ecosystem energy, it feels like we’re just getting started. The future of building the future is distributed. It’s not on one elite road in California where a bunch of VCs hung a shingle over the past 50 years.

It’s wherever the people, problems and community of intrepid problem solvers meet. And Brooklyn is for sure one such place. We’re just hitting our stride.

Stay tuned for more from the field!

If you need help exploring, unlocking and doubling down on the future, reach out to the team.

The Assignment

HP Labs excels at R&D and the broader organizational machinery is incredibly efficient at scaling operations around existing products. However, the executive team wanted help accelerating pipeline activity and bridging the gap in their commercialization process between R&D and compelling commercial opportunity. Several projects had been in various stages of development for years, without a clear path to market. Co-Created stepped in to help identify and prioritize the strongest use cases for driving organic growth and new revenue streams and developed a repeatable process to commercialize new IP as it emerges/matures.

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The Solution

Our team bridged the gap between R&D and market success by helping the executive team align on new opportunities, increase agility, and go to market with anchor customers. The engagement kicked off with technical presentations by the R&D leads, and continued through a structured, phased approach to surface a wide variety of potential use cases and hone in, with increasing levels of validation, on compelling commercial opportunities. Co-Created facilitated working sessions with the R&D teams and executives, conducted extensive market research and discovery, and engaged with dozens of industry experts and prospective customers through its own outreach across the use cases identified. 

To help prioritize use cases and force decisions throughout the engagement, we leveraged a scorecard, consensus voting, and templated use case summaries and business cases. The scorecard, for example, was customized to HP Labs commercial and strategic criteria, and enabled the collective team to evaluate dozens of potential use cases in a structured way – looking at evolving market dynamics, shifts in consumer behaviors, the size of the opportunity, technical feasibility, and the competitive landscape. The ultimate goal was to narrow in on the few most compelling opportunities that had strongest alignment to HP Labs’ strategic priorities, biggest market opportunity, and clearest signal of demand from large, qualified customers.

The three most impactful capabilities Co-Created brought into the process were (1) digesting and translating technical descriptions into market-ready propositions, (2) bringing structure and granularity to evaluating use cases and the criteria that matter most, and (3) spearheading market outreach and direct customer engagement. 

Co-Created engaged directly with the research teams, over several working sessions, translating their ‘technical’ info into market-facing value propositions and critical assumptions to be tested further when surfacing business use cases and validating customer interest. Prioritization, through scorecard evaluation and use case ranking, was based on factors such as market size, potential for differentiation, alignment with the company's strategic goals, and the feasibility of development and commercialization. To engage prospective customers and validate use cases, we leveraged our global network of corporate clients and subject matter experts, as well as third party platforms and direct cold outreach, to find the right people in market. We iteratively built up our understanding of and point of view on the use cases, digging deeper in each phase of the engagement as we progressively narrowed our list to the prioritized few.

By building out the detailed business cases with direct input from prospective customers, Co-Created helped cultivate relationships and build credibility with those customers – making way for an organic transition to negotiate and sign Letters of Intent (LOIs) with those customers for large scale pilots. This step was about moving from theory to action, translating strategic planning into tangible partnerships and projects. Finally, we handed off the projects in flight to HP Labs’ corporate development and supporting teams. 

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Outcomes

Within four months, the HP Labs team was able to advance from the exploratory stage to customer validation, working with several qualified partners on projects in flight. The HP Labs team built conviction around the prioritized use cases, as well as those opportunities not worth pursuing. This rapid progression from early thinking to actionable plans for commercialization underscored the fast paced, structured process that Co-Created applied to R&D commercialization.

The overall process was incredibly iterative, data-driven, and collaborative. It involved constant feedback loops with the market and the HP Labs teams, ensuring that every decision was backed by solid market-based feedback and validation and had internal buy-in. The ability to sift through dozens of potential use cases and pinpoint the most and least viable ones demonstrated a strategic clarity and focus that can be lacking in traditional R&D processes.

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How can we help you?

Contact our team to learn more

It’s our job to understand the disruptive trends that we are seeing in the market and help our clients and partners spot opportunities for growth. As part of our “Field Notes” series, our partners share what they heard at key industry events.

This week, Daniel Shani, attended the ADRP: The Association for Blood Donor Professionals annual conference with our client, Delcon, to share more about our collaboration and to help increase engagement with blood centers.

Here are some of the challenges the industry is facing and some forward-looking solutions that are driving progress:

1. As you’d expect – when a patient with medical bleeding or severe trauma is in transit to the hospital, every second counts. Life saving blood transfusions are given at the hospital, and travel time delay with EMS often has dire consequences for patients. Some leading organizations are collaborating to test making blood available on EMS vehicles (ambulances and helicopters) and are already demonstrating impactful results.
2. There is a big imbalance in the diversity of the US donor pool. Over 70% of donations come from caucasian males. As little as 2% of donations come from African American donors. The diversity of the donor pool is super important for a variety of reasons, but especially for conditions like sickle cell disease, primarily affecting African Americans, where the donor’s genetic likeness to the recipient is critical for effective transfusion. Alayna Maxson and her team at Solvita are pushing boundaries and seeing results, nearly doubling their participation by African American donors in a 2 year timeframe. They followed a rigorous social science research framework to really understand their audience, and translated their findings into direct community engagement, debunking of common misconceptions and perceived risks, and tailoring of incentives and operating hours to best meet the community’s needs.
3. Lots of prospective donors drop off during the online booking process and there are lots of innovations around finding ways to make it more convenient for blood donors to get the information they need, including the use of new technology and AI. As estimated 35-40% of donors that begin the appointment booking process, drop off before confirming an appointment. That represents a huge amount of effort and resource to engage a donor that does not ultimately convert into a much-needed donation to maintain blood supply levels. New solutions range from AI chat bots to white glove service concepts, aimed at delivering a better donor experience and presenting the right information at the right time, all while reducing the level of effort and input needed by short-staffed blood center teams.
4. ✨Bonus✨ New line we heard and loved: What’s the rock in your shoe? We often ask about problems keeping people up at night. This is a different flavor that really effectively gets at a wider range of day to day issues – constraints slowing down your team, blocking step function improvement, or sapping people’s motivation.
   

If you need help solving a complex problem, building a new solution, or unlocking new ideas for good growth, reach out to the team.