BPM Partners James Lichau and Jill Pappenheimer explore the complex people-related challenges many fintech firms are currently facing. Learn how BPM can help build and support the foundational and agile HR function needed to succeed in the fast-paced fintech landscape.

The fintech sector has faced its fair share of challenges in the current market environment. The U.S. Federal Reserve’s campaign against inflation through interest rate hikes has led to slower market conditions and diminished valuations for fintech firms, hindering their ability to secure capital.

In response, many companies have had to develop strategies to preserve cash and extend their runways. For some organizations, this has resulted in cost-cutting and staff reductions. Without an established and formalized people strategy — often the case in fintechs that are more focused on growth and fundraising — laying off employees can introduce heightened risk. The HR strategy should be adaptable to changes and agile; otherwise, growth potential may be restricted.

People challenges are intensified in the fast-paced world of fintech

The fintech space is competitive, rapidly evolving and often has high levels of employee turnover. The key word is change. And that change happens quickly, especially when financial markets are volatile. These firms need the ability to scale rapidly with market cycles. In this environment, employee engagement can be especially challenging. When engagement suffers, so can morale, culture, recruiting and retention. Complicating matters further, several fintech firms have transitioned to a fully remote or a hybrid work model. Many functions may also be located outside the U.S. Engaging your teams is even more challenging with your workforce spread across geographies. There’s also the need to understand and comply with HR requirements across a variety of jurisdictions.

Increased potential for reputational, legal and compliance risks

Often, fintech founders and leaders do not have the bandwidth to focus on the HR function as they work to grow the core business or raise capital to keep operations going. However, people are the core of any business and cannot be ignored. Your organization is nothing without its people. If you neglect this critical element of the business, you open yourself up to reputational damage and serious legal and compliance risks. Additionally, vital areas such as succession planning, career path planning, performance conversations, payroll, onboarding and much more could fall by the wayside.

How BPM can help

Building an agile and healthy people culture is all about setting up a solid HR infrastructure that can help fintech organizations flex with market shifts while keeping reputational and legal risks to a minimum.

BPM’s HR Services help you navigate today’s complex HR challenges. We work in partnership with your team to evolve your organization’s people strategy and HR practices from the tactical to the strategic, with the right tools, operations and knowledge to set you up for future success. Our seasoned professionals are adept at creating solid people strategies. We can build the HR structure and processes to help your fintech organization lower risk levels, support current operations and enable future growth. In some cases, such as the initial start-up phase or in a cost savings mode, it may make sense for you to outsource your entire HR function. In such cases BPM can provide complete fractional HR services.

Our areas of specialty include:

• Compliance
• Employee Relations and Development
• Payroll Services
• HRMS Implementation and Optimization
• Compensation Services
• Talent Solutions
• M&A Readiness
• Diversity, Equity, Inclusion & Belonging
• Culture Enhancement

Contact us today to get started

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