LendInvest GC Ruth Pearson talks to The Lawyer ahead of her session at the In-house Financial Services conference
How can a financial services business ensure growth, profitability and sustainability?
It’s something you have to build into the structure and strategy of your business from the outset. Those three aspects (growth, profitability and sustainability) have been central to the LendInvest business model for the past few years and we’ve been able to deliver each of them consistently year on year. At LendInvest, we pride ourselves on continuing to prove that it is possible to achieve rapid growth whilst also making a profit. Financial viability is important to all our stakeholders (employees, investors, customers, the regulator etc) as is ensuring that a culture of compliance is embedded throughout the business – SMCR implementation, for example, has been welcomed by the whole business in that respect.
Our leadership team is responsible for delivery of our growth, profit and sustainability targets. We have sought to maintain growth year on year but have measured that growth to ensure it is being achieved with the longer term success of the business in mind. We’ve sought funding (and funding structures) that fit our business model and help us achieve those objectives, looking to reduce the cost of our capital and driving profitability. One size does not fit all.
Sustainability also comes from good corporate governance, providing confidence to our stakeholders that our business is being run well and helping us secure the commitment of new institutional partners. The reward to the business of having a strong governance structure in place is more stable financing at a lower cost of capital than would otherwise be available. The processes we went through to be the first UK fintech to list a retail bond and our more recent public securitisation of £259m buy to let mortgage assets (the majority of which achieved a AAA rating from the rating agencies) are testament to that.
There are macro factors that would help us ensure growth, profitability and sustainability for the future: what we really need to support entrepreneur-led businesses in the UK is to make it easier for highly skilled tech workers to come to the UK and to encourage innovation at the same time as compliance. As a business, we approve of the Home Office’s inquiry to overhaul the visa/immigration system and we have submitted evidence in support of the adoption of an Australian-style points based system. We’d also like to see the scope of the FCA’s regulatory sandbox increased to help fuel sustainability developed growth.
If you could sum up the current climate of financial services in one word, what would it be?
What are your top tips on creating an efficient team?
Collaboration – we’ve focused on ensuring the team works collaboratively with the business, establishing each member of the team as a business partner from the outset and not as a technical support function in the corner.
Understanding the business strategy – this is essential to the team understanding priorities and means we can regularly assess whether the correct matters are being focused on. In a high growth business, priorities frequently change and its important to be on top of this to ensure the team is delivering on the key value-add projects.
Focus on delivery – we’ve taken the lead from our software developers and now work to modern Agile principles. Using a Kanban board to track all of our workflow, the team provides business-wide visibility on the stage at which each matter is at, what the blockers to delivery may be and ultimately promoting continuous delivery.
If you had to be stuck in a lift with one person, who would it be?
A lift engineer.