Fintech Leaders: Jeffrey Axelrod

Key Takeaways



Web 3 is an idea for a new iteration of the World Wide Web which incorporates concepts such as decentralization, in the form of a distributed ledger such as blockchain technologies, and token-based economics.


Decentralized finance offers financial instruments without relying on intermediaries such as brokerages, exchanges, or banks by using smart contracts on a blockchain.


An automated clearing house is a computer-based electronic network for processing transactions, usually domestic low value payments, between participating financial institutions. It may support both credit transfers and direct debits.

We spoke with Jeffrey Axelrod, mentor and coach to financial technology startups about all things fintech! Jeffrey currently works as the Managing Director of Fintech Alchemy, where he mentors and coaches fintech startups and CEOs. Prior to Fintech Alchemy, Jeffrey served as Executive Director of EvoNexus (Silicon Valley Fintech Incubator), CTO of Backstop Solutions Group, and CEO of Cogency Software. In our interview, Jeffrey shares insights into his favorite kinds of startups to work with, the hardest parts of building successful teams, and the biggest changes and constants he predicts for the fintech space in the next 10 years.

BE: So Jeffrey, I saw you spend almost three years as Executive Director of EvoNexus. Can you talk about your time there and some of the most interesting learnings you had, working with the incubator and with everyone from founders to investors?

JA: Sure. I started out in EvoNexus, as a volunteer on their selection committee, and then moved into the role of executive director. It gave me really broad visibility into what was going on in the FinTech space with new companies. So I got to see probably 10 new startups a week. Just understand where the market was going, as well as really honing my own skills of quickly assessing, what is the company doing? Where do they live in the space? What's their trajectory? Possibility? And what did I assess their likelihood to be? So I got very interested in the work of storytelling, how do companies tell their story? So that was really interesting. I got to work with a lot of investors, both very established series A and beyond type investors. But more so working with either angels or seed stage FinTech investors, who were also doing that same kind of assessment on where's the market? Where's the company? And what's the likelihood of this being a good investment? So that was also good. 

Well, this particular incubator that I was at is very much tied to industry. I also interacted a lot with corporates who were interested in innovation, and just understanding how corporate innovation ties into what startup innovation might be, and they don't always intersect, right? Corporate innovation is very targeted at a specific goal that that corporate is looking for, not nearly as broad as what the market out there. So it's just a lot of interesting work interest at the intersection of all of this.

BE: Yeah, absolutely sounds like a really happening place to be with for one, not only the innovation in the space but two, the fact that policy is changing so rapidly, and how that affects the space. So kind of in a similar vein of thought, I'd love to hear about some of your favorite startups that you've worked with or gotten to see through the process.

JA: Well, I think I'll skip the names, but just give you general categories. We saw a lot of personal finance management, I almost felt like that's been done. It's moving on, we're done with that. But they still seem to exist in there, lots of them. And some of them target a specific demographic, and some target a specific geography. And there's still quite a big market for new companies, if you find your specific niche, and you can grow it fast enough to really have some kind of stickiness. Because it's a really crowded space, there's so many personal finance managers. But I came around to understanding that there is space for those that specialize in some particular way. So that was interesting. 

Web3 or DeFi as it's been called – fascinating – that's for sure. Interesting, a little bit of a risk appetite that you need to have in that space if you're going to support or sponsor that but clearly that's going to be a big thing. It's just a question of whether the companies around today are the ones that can survive tomorrow. But I enjoyed working with those. 

And then my own personal history and specialty in there is folks, things I've enjoyed working with are the very vertical market. Enterprise B2B fintechs that deal with specific super vertical areas, maybe it's loans, enterprise level loans, infrastructure loans, insurance markets. This is interesting to me, because it's where I've spent much of my career, so I understood the base, the life cycle of those companies, they take years to build up, as opposed to consumer apps that you could build much more quickly and get some traction. So those are the areas that I found I spent a lot of time in and found interesting.

BE: Very cool. On your point earlier about the intersection between corporate and startups, what do you see the role of personal finance being in creating that intersection, or if it's not really as much of an intersection as we think, if it's really more on the startup side of things?

JA: No, corporates care a lot about personal finance management, because it's their hook into people, like people, consumers are going to use some app, which under the covers reaches out into various services. So banks care a lot about personal finance managers, any kind of investment or house investment shop cares about that. And because they want to be the back end, for any of those things, they want to own the consumer, they want to own the apps that you use on your phone. And so anything they could do to have their logo on it, to say “powered by” or “using the services of” this bank, or this brokerage, or this investment strategy. You know, they definitely can. And so it's not a direct B2B, it's not like, small number of transactions, high volume, but rather, it is about quantity. And it is about getting into the mass market, so that they can have a piece of that puzzle. So they care a lot for sure.

BE: Yes, makes sense. And, you know, there's so much innovation coming into this space. I think people on the startup side of things, sometimes see themselves as diametrically opposed to the more established banks, but some things are not going to change, at least in the near future. So, instead of asking, what do you think are the biggest changes to the industry, I'm going to ask the opposite. What do you expect not to change in the FinTech industry? Or just in the finance industry in the next couple of decades?

JA: What will not change? Yes, very interesting question. Well, there needs to be rails that money moves on. And whether those are traditional banking rails or credit card rails, or DeFi rails; it's an evolution of the specific technology. But the context stays. Though, I don't know if that counts, but you know that expression, “the more things change, the more they stay the same.” I'd say, when I look at the way enterprise B2B companies are working today, they have new technology, they have new concerns they have to address. But fundamentally, the structure and the framework that they operate within, is very, very similar to what I was doing in the late 90’s. But now it's like the beginning of the early 90s, when I was beginning to work in that space. And the technology has changed absolutely, completely, but there's still so much relevance to my experiences over the past 30 years. So, in that sense, I think it's true if you abstract far enough, the structure of it all stays similar.

BE: Absolutely. I think when you look at certain types of, like you said, “rails” which are conduits for moving money, like ACH, a lot of those have remained unchanged for decades and decades. So, I think that's one area that FinTech really has to continue to build upon and isn't going to be able to fundamentally change right away.

JA: I think DeFi is an opportunity to move away from ACH. But you know, that works for some part of the population and other parts of the population are going to have to find a way to merge the benefits of DeFi with the KYC and AML security, privacy, or lack of privacy for that matter, but all those things that people count on when you're going through traditional banking rails, and there will be an evolution that merges the instant settlement of crypto in DeFi with the security of ACH. And so we will see evolution, but yes, we'll figure out what the needs are – what is driving the need for all those different versions of rail?

BE: Absolutely. And you know, even with Mooch, we still see the same need for KYC. And then if someone fails KYC, how do we manually fix that? So certain things you need to keep people feeling secure. And at the end of the day, we still require a bank account to be linked. So even here at Mooch, we're not quite there yet.

JA: And you won't move totally away from KYC. Because there's regulatory issues in place, and more and more regulations. And we see the dichotomy, for example, with crypto these days, when on one hand, crypto has made it very easy – take a look at what's happening with Russian/Ukraine right now – crypto has made it very easy to send money instantly to Ukraine, which has been a great thing to make it move quickly and avoid all the banks, intermediaries. And then on the sanction side, crypto makes it a little bit more difficult to create sanctions because of the privacy that doesn't exist, the lack of visibility. And so both sides of that are interesting. And so you can’t say, we have to go totally one direction or totally the other. But you see where there are features of each that are interesting and where that goes.

BE: Absolutely, and that's not even to dive into the ethical considerations of crypto and this whole space. So that leads to my next question: what are the best ways for those of us in the FinTech or financial services industry to make sure that we're being the best moral versions of ourselves, practicing inclusivity, financially and otherwise? You know, some say crypto and DeFi open up a whole new world and others say, well, it opens up a new world to some of us, but there's still so many major impediments, and there's so much gatekeeping along the way. So what do you think are the best ways for us to practice that?

JA: I think it's up to the companies, the startups, the apps, to bring it to the right population. That is, crypto itself is neither inclusive or not inclusive. It is just simply blockchain or the various layers built up from blockchain, crypto, etc. You could say inclusive, because anyone could get there. But the reality is that a limited part of the population is comfortable getting there. But I think on the apps, this actually takes us back to the question earlier about personal finance managers. And where is there space for them? Well, it's targeting either a different type, or geography, or both. And that's where inclusivity, I think, comes in. Companies focus specifically on these social issues that might create the opportunity for inclusivity. Because it's not just technology, it’s technology, it’s marketing, it’s ability, it’s distribution. It's UI UX, I mean, there's so many issues, to go into what stops or encourages any population from using financial apps. Things have to be good. Focus them in different ways and not think one technology or one app will be ubiquitous.

BE: Absolutely, I think that's a really interesting framing of what we talked about earlier, about companies finding their niches and the thought of the social issues that you're trying to solve that become your niche for certain startups and companies. I think especially at Mooch, that's not been hard. But thinking about our audience that is so engaged on Tiktok, they're all younger, they don't have a lot of money to spend. They need a free app, they want to get rewarded to budget, they want to learn these things but it's not really as available to them as it could be, without going through a traditional bank or having a financial advisor or paying for a service like Mint or Monarch. So that's a really interesting framing. 

JA: In fact, I think that my interaction early on with Mooch was an eye opener in that way, because it made me really understand that there's a different way to market and reach 18 and 19 and 20 year olds than what I'm used to. And however much I think I'm broad minded and inclusive and I see the world and all, that turns out to be not true, no matter how much I try, because I'm just not in that world. And so I had to hang out with Kevin and hear what he's saying on his Tiktok channel to understand why there's a market for Mooch.

BE: Yes, absolutely. And it's so interesting because Kevin has his huge following on TikTok and in the last month or so, he's also blown up on Instagram. He has over 40,000 followers on Instagram now. And what I've been doing has been taking his videos and posting them on Pinterest. And it's so interesting, because on every platform, there's a different demographic, right? TikTok is a little bit younger than Instagram. Pinterest is like 10 years older than the average Instagram or TikTok age. So you see different videos and different communication styles doing really well on certain platforms, and not really well on other platforms.

JA: I think it's reasonable to say that you can't build an app for all ages for all things. And if I see a company that's focused on the 18 to 20 year olds, I say, great, you can also reach the 35 year old suburban families. If you're trying to reach the 18 to 20 year old, first-time finance people, it's going to be different, right?

BE: Exactly. And then we see that with the content, like Kevin will make a TikTok on how to save for a family or for buying your first house. And it'll get like 10,000 views, which is still a lot, but not as much compared to his other videos which have millions of views. But then you go put that on Pinterest, and it blows up. But that doesn't necessarily hurt our traffic, per se. It's just been a really interesting dichotomy from the marketing side of things. So zooming out to the years that you spent in executive roles from CTO to CEO, what do you feel has been the hardest part in building teams and motivating your team members?

JA: You always have to find people. That's not the hardest part. Giving them a vision of what you're doing is the most important thing. And it's the thing that will keep them. So you're competing when you build, when you're hiring people; you're competing with every other company that's out there. If you want to get good people, you need to have a good story. And you have to not only have the story to tell them once, you have to create that story. In reality, you have to implement it. Because people come into work, and it feels like you're just on a hamster wheel, you know, you walk in and it's going but it doesn't go by itself. Someone has to create that environment that sweeps you up and gets you interested. 

You know, people talk about the mission of the company, or the culture of the company, the financial success of the company, it's all of those wrapped up into a story that is real, you know, it's a story as the way you weave it, but it has to have reality behind it. And I think it's in my roles, my various roles of building teams, it's the people part that was really the most critical part of the role. Because if you hire people and get a good team, then comes the multiplier effect, you always hear that. But you also want to be sure you have content and not just motivation, not just like cheerleading skills, but that there's true content behind it all. So that means as a CTO, it means you really have good technology that is interesting to work on. As a CEO that you really are doing something interesting in the world, you really have something that people can feel proud about participating in and talking to their family and their friends about what they're doing.

BE: Definitely, and I think in a lot of larger tech companies, people tend to lose sight of that vision, or they have employees that aren't going around telling their friends and family how much they value working there. And I think you see that in really high churn rates, especially now with the Great Resignation and people are changing jobs, and it's easier to change jobs than ever. But personal values and values of a company is really what pulls people in, at least that's what I felt like really pulled me in with Mooch. It was the thought of working somewhere where my work is going to directly benefit people, and that was my main stipulation for looking for a role and I feel really lucky to have found that. But we even saw with the most recent hiring process, we had over 1000 applicants for two roles. It was crazy. We just posted them on LinkedIn and AngelList, and within days had 500 plus applicants per role. But on this idea of values, not just in the workspace, but on a personal level, how do you infuse your personal values into all of your other roles and all of your work with these different companies?

JA: When I was a CEO of a company called Cogency that built accounting systems for pensions, endowments, hedge funds, funds. And so in my more cynical moments, I would say, “our role, our purpose is to help rich people get richer,” and clearly that is not going to go over very well. But in my more studied moments, as I thought, really, what am I doing here, I would say, “I'm building a place where people could come in to work every day, work with smart and nice people, learn facts and learn about an industry, earn a paycheck, so they could go home and take care of their families, and know that they're working in an environment that cares about them as much as we care about our customers.” That really got me through 10 years of building and running that company, of saying that it really was about creating community, it wasn't about making a judgment, unnecessarily, about our customers. And you know, what I said about the people getting richer, but that wasn't really at all what I experienced. We worked with lovely people who themselves were in a similar position. And if we treated our customers with as much care as we treated ourselves and our teams and our own company, then they also would go home and feel good about their day at work. 

So in that sense, that was my value that I instilled in the company that I think was quite successful, so that we didn't have to sit around and wonder, why are we building accounting systems for hedge funds, but that there was something beyond that. And then of course, you have to find a way to make sense within the industry as well, in the domain space. But fundamentally, it was just that attentive care; caring and also caring about coming into work, learning from each other, and making a living so that we could have good lives.

BE: Absolutely. And the intrinsic value of working somewhere, one where you're surrounded by smart, kind people, like you said, and two that your work is valuable, and that you're making a difference, at least for yourself, for your family, for those around you. I think there's intrinsic value in that, but like you said, it's not always easy to remember that on your worst days, or your most cynical days.

JA: Oh, but that's right. And, you know, sometimes we think we should all be out there, fixing the climate change problem. But the fact is that not all of us can work on things that change the world in any major way. So each in our own way. And one thing I've also learned along is that it is also valid to say you work in an area as long as you feel ethically good about where you're working, that you work where you can bring the most value and some of that value is financial, and then you could turn that around and that financial value could turn into supporting the causes that matter. And sometimes I feel that I can do more for causes that I care about by making money and donating to those causes than I can by going in and working on those causes. So there's so many ways where your values can come out. And it doesn't necessarily have to be just that your work has to be directly tied to those causes.

BE: Definitely, so expanding on your point there. What would you say to founders, or not necessarily founders, but young people, anyone looking to break into this space who feel unsure if there's a role for them in this space, or if this is where they should be going? But if they care deeply about fintech, what advice would you give to these people?

JA: I think that you find something that you both have some aptitude for, and that you intellectually care about, then you just pursue it, and you will find a channel in as opposed to thinking, “now I have to go this way, I have to go work.” And in the old days of investment banking, that would be to go via an engineer and work at Google or Facebook. Not true, by whatever means you have an aptitude for and an interest in, I think you will find a channel to bring that into what's good, to bring that into a way that you turn it into your livelihood. 

I don't think it's always direct. I think that it takes creative thinking. But I think it's important to follow those passions and know that you can just simply believe that then you will find a channel or that interest in that passion and that aptitude combined.

BE: So important. So we're almost at a time here, but just a little personal question to wrap things up. Are there any topics or issues right now that you're super interested or passionate about or following? For me, it's DAOs, looking at the role of decentralized autonomous orgs and how they're developing because it's such a new space. Do you have any interests like that, or any companies that you've been working with that prompted you to go do more searching or more learning?

JA: I've worked with quite a few companies that are doing NFT's. Okay, first, it seemed trite. And I think that there are more and more companies doing work within the NFT space that is not feeling trite. Everybody, you know, we all laughed at it when we first heard about that. And there's some serious visual artists who are finding their way through NF's. There's the intersection of NFTs and DAOs, that is interesting. There's the use of NFTs both for visual arts and for music. I've been talking to a couple of people around what's happening in the performing arts. So that will probably turn into video but you know, just different ways to take culture and tie what's been traditionally thought of as this, the cultural realm, the arts, into the digital realm. So that's interesting. 

I'm also quite interested in DAOs as a governance method. Throughout my career and life and various aspects of it, I've run into all the different governance methods that have been tried over the last many years. I'm remembering the one that we used at Zappos, which was called holacracy samples. Now, it was a form of government called holacracy. And, you know, in a way I think of DAOs as the most recent attempt at a different form of governance. Your consensus, that consensus, the concept of the company you know, if your organizations use that or have been on various nonprofit boards, and they have a governance method that is generally policed in practice quite differently than private companies. And now we have DAOs and so I'm quite fascinated by it. And whether it will, whether there's some cultural phenomena that makes that more likely to work now than holacracy, or consensus that worked in the past, because I would say in the past, they did not work, or those worked in limited cases. And there was something about benevolent dictatorship, that we may not like the terminology, but it worked in its own way. So I see doubts about it working, you know, and I'm very curious to see will those work on any larger scale? Or would they work in a contained space where the participants are really geared for that, but not in a larger space? So quite fascinated by whether it's democracy, autocracies, and now in the bigger political space of the world? Socialism, Communism, DAOs, holacracy. And looking at all of them and saying, what is it that creates a working governance model for a given time?

Loved this interview? Read more interviews from our Fintech founders & leaders series here.

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