Collaboration is not fostered by a transactional relationship. It is a considered, deliberate and evolving process. Many FinTechs fail to sustain meaningful collaboration once the partner has been identified. Upfront consideration of the resources, concerns or inevitable challenges that will occur in any partnership is vital to ensure the relationship demands can be sustained.
When traditional firms become deeply involved and offer guidance based on their business knowledge and expertise, the partnership is solidified. As FinTechs have limited resources (i.e., personnel, funding), dedicated resources provided by traditional firms (such as infrastructure) help FinTechs focus on their core competencies during the partnership. A well-defined partnership strategy, objectives, and a responsibility matrix are also helpful. Define success criteria early!
Allowing the FinTechs access to a broad flow of customers and data, while preserving the FinTech culture goes a long way in building trust. Not surprisingly, fixed hierarchical ownership of assets, processes, and resources does not foster healthy collaboration. The ability to scale the innovation may be diminished when the proof of concept or prototype (developed separately at an accelerator or incubator) cannot smoothly be integrated into the core systems.
Business model and operational process differences can erode collaboration between FinTech firms and incumbents. Similarly, cultural dissimilarity and inadequate alignment with each-others' business goals can be divisive.