Panagiotis Kriaris, Director and Head of Business & Corporate Development at Unzer: The Blueprint for Fintech Partnerships and Sustainable Growth

Speaker A: This is the Scalepoint podcast, hosted by me, Martin Kodarish. On this show I sit down with founders and experts in the payments and fintech industry to explore key trends, opportunities and the realities of building a sustainable and profitable business in this next phase of the industry's growth, defined by tighter budgets and more challenging access to external funding. Right, let's get started with this week's episode. Okay. This week I'm thrilled to be joined by Panayotis Kiliaris, director and head of business and corporate development at Unza. So Panov, just welcome.

Speaker B: Thank you Martin. Thank you for having me. All good. Always good to talk to you.

Speaker A: And so maybe we just kick off with uh, just a reminder, brief introduction to yourself.

Speaker B: Yeah, so my background is uh, financial, uh, services I would say. So uh, I've been working always on the business side but uh, with a close connection to uh, technology and innovation I would say. Um, so I've, I've done all the, I've started from uh, from the backing side and then moved on to gradually moved on to fintech, uh, payments and I always say have the privilege of uh, um, uh being able to understand having been on both sides of the fence working for uh, banks, uh, and then also leading fintech partnerships, now working on the fintech side but also very closely working with banks. Uh so I think that's um, a benefit uh I have. So it's very interesting to be able to understand both sides and be able to understand uh, the various challenges and how uh people uh, see things from each side. Um and I guess that's also part of uh, today's discussion. Right? So happy to, yeah just for a

Speaker A: bit further context, a bit of an intro into unsa.

Speaker B: Yeah, Sonder is um, ah, I would say one of the most data fintechs in Europe at the moment. We are uh, basically a B2, B2C uh fintech on the payment space, major uh, markets, the daft market plus the Nordics. You are covering all the end to end piece. Um, so I think you're going to hear from us.

Speaker A: Uh, okay, great. I'm really curious your perspective um, of the current state of fintech partnership. Where do we stand do you think? Looking back and looking forward?

Speaker B: Yeah, I think it's one of the most interesting topics to understand because I mean the evolution of the fintech partnerships I think is a bit uh, reflecting also the evolution of the industry. Um, so I mean I'd like to start from the reasons. Right. So why would fintechs uh, partner either with other fintechs or with function. And I think um, I um, see mainly uh, four or five uh, reasons. So it's mainly to grow the business. I mean fintechs have also been facing ongoing uncertainty in terms of the regulatory positioning. So that's one main reason as well, uh, challenges in gaining scale and visibility. So that's an additional recent partner, uh cost effective, uh funding and of course uh, I think we also had the profitability versus growth question coming up uh, on popping up uh in a strong way lately. Uh, I would say so. Uh, we had the um, transition from an old growth perspective to a sustainable uh profitable uh growth which has been a challenge for fintechs. So I think that's one side of things, how you look at things. And then of course if you look at um, the fintechs, uh, and the banks relationship, I would say that uh, maybe, I don't know, a few years ago when things were starting, many uh, banks were uh, I mean there was this kind of uh, threat. Right? So many banks would see fintechs as a threat and vice versa. I think now banks are joining forces with fintechs, uh especially on the innovation side, on the payment side. And I think that's where things are moving. So I think we're seeing this partnership focus all the more. Of course you cannot uh, do it uh, without the um, competition element uh, which is going to be there. Uh, but I see more uh, and more. I mean if you look at the partnerships that banks have been doing, uh, I think every major bank and even the smaller ones, the midsize ones, they at least have a few fintech, uh, partnerships in different uh, um modes.

Speaker A: Do you think broadly speaking those, those partnerships with fintechs from a bank's perspective have been successful?

Speaker B: I think it very much depends. But um, um, I mean um, if you look at the partnerships, I think you see lots of lots as I said before, I uh, mean there are various ways how to do it. I mean there is uh, you know some banks have been buying fintechs, they have been working with fintechs. You have business accelerator programs, you have the traditional partnerships where they cover some gaps on the payment side, on the innovation side, on the operation side, maybe on the um, I don't know, on the customer service side. So whatever needs banks have to quickly cover, uh, it's a good way to uh, partner with fintechs. Uh, there have been investments so I think there are lots of ways.

Speaker A: There are. You get the impression the market's still exploring, right, the best practice and trying to establish and identify Best practices.

Speaker B: Um, it's, it's true. But I think one thing that we have been seeing and has been happening is that um, things have been moving very fast lately. And I think it's safe to say that not everyone can follow, especially banks because they are you know, big organizations, incumbents, they have very specific structures. So I think uh, working with fintechs is always a good way for them to accelerate innovation, to get access to innovation, to get access to new stuff.

Speaker A: Yeah.

Speaker B: Especially now as we are discussing for example, I mean we are now discussing AI and technology and how banks are adapting to this new environment. So I think there is always uh, I mean there is a bigger need for companies that are able to help them drive the change.

Speaker A: Right.

Speaker B: And give them access to innovation. I mean uh, it's not a one to one, uh, I would say comparison but I was uh, uh, writing the other day about how Oracle has been investing, let's say in an AI company. Uh, no, uh, ddn. Right. And this is basically company that is helping organizations navigate uh, AI. So how do you train AI models? How do you roll out models? How do you manage models? So I think there is a kind of a parallel with what uh, banks in general need uh nowadays. And you know I think there are quite many fintechs in the space that are able to at least cover the needs uh, in the.

Speaker A: It's interesting to look outside of the banking or even financial services sector to see how other sectors execute partnerships. Right.

Speaker B: I think uh, there is no one size fits all recipe. It very much depends. But what I've seen is for example I think um, banks have been struggling uh, more uh, to put it like this with uh, acquiring fintechs then let's say um, um, integrating them in their uh, setup in your organization. Because sometimes you lose uh, people, sometimes you lose this innovation touch for example. And that's why there is a challenge of okay, how do you keep innovating in an organization that is not structured uh, in a certain way to do this kind of stuff. It's not agile, it's not flexible. You have all this kind of uh, old technology uh, that you need to adjust. Which is why uh, many times you see for example um, big banks and they are setting up other digital banks as a separate uh, setup. I think that's the main reason why they are, it's very difficult to innovate uh, in a way that makes sense within a traditional framework and setup of banks. And I think banks understand this as well.

Speaker A: Yeah. So you mentioned sustainable growth and the Shift from growth at all costs to sustainable growth. Is that still ongoing that shift or are we seeing um, a desire to revert back to more growth orientated strategies?

Speaker B: I think that's going to stay for quite some time and I think it very much depends on the macro as well. So I think the fintechs and in general I think companies, they had to uh, because of the macro, uh developments uh, they had to change I would say overnight. It's uh, a bit of an exaggeration but they had to change very fastly from the on growth uh uh perspective this model to a sustainable business model. And if you look for example at what investors are looking at at the moment, I think they are looking at sustainable business model. That doesn't mean that these are not um growth focused business models. But on the other hand they have to be able to uh, to be sustainable, to make money, to prove that there is a business to be had. It's not the only that is funding the model. And I think one of the biggest challenges that fintechs have uh faced within this transition is how do you take a setup that is geared towards uh growth. How do you take the skills and the people and all the uh culture of the company transform to something that is very very different because the skills that you need to be profitable to be sustainable are uh, not I m would say overlapping to a very big extent uh to the previous business model. So that has been a real challenge. Uh you have seen many uh companies, many fintechs also including billing uh because of this. Um but that's that, that's I think uh, that's the thing that that's going to stay I think the profitability sustainability element.

Speaker A: Yeah. And in your experience what, what what view do investors or take on partnerships? Um, I mean are they considered to be um a sustainable growth strategy by themselves?

Speaker B: I think I, I mean what I've seen that partnerships have are very, it's a very strong growth element. And the reason being that for example first uh of all you're covering many, I mean you are uh bringing, you can bring in a house many skills that you don't have within the company by partnerships. Right. And you do this in an efficient and fast way. If you do it the uh, rightly that's one. And the second thing is that you are basically creating um additional layers of growth. Right. So I mean all the um, I mean nowadays with the API economy, with embedded finance stuff with open packing, I think uh, getting partners that are helping uh you to grow has become much uh Easier and on the other hand I become indispensable. So I think it's always good to have your own sales, uh, uh, resources and strategy, but the multiplier of the right partnerships. I think it's something that you need to have. And I mean I mentioned uh, before the APIs, I mentioned all these new business models. I think this is something that an investor is looking at because at the end of the day it is also having a great impact on the uh, on the business model, on the growth trajectory of the company, how fast they can grow, how fast they can deliver, on their metrics, on their goals. Um, so I think that if you do it the right way, uh, uh, and we can discuss also about the role of software, uh, but if you do it the right way, I think that's any, that should be an indispensable element of uh, the strategy of a uh, fintech company and in general of a company that wants to be successful.

Speaker A: Yeah, go ahead and expand on the sort of software element that you hinted at.

Speaker B: I mean software has, I mean if you look at the market not only in the fintech space, but let's take finance, uh, and finance and services. So software has become on the one hand side a delivery means uh, on their own, uh, right. And on the other hand uh, you have so many software companies and you are, you have a combination. So for example let's take payments. Right. The combination of software payments uh lately has become very, very powerful. So you are. We see many, many uh fintechs who have been basically uh, changing their business model from selling, let's say payments to selling software and then making their money out of payments. So software has become very, very uh, strong. Then you also have these uh, software partners. So these companies selling software mainly on a vertical basis and then partnering with these kind of companies is very uh, often uh, I would say big booster in terms of doing business. Uh, so I think this is a story that we keep seeing in financial services across uh, segments and across verticals. And I think that's a story that will uh, continue.

Speaker A: So in that context, I mean I was speaking to a CEO in the US actually only last week and he mentioned, kind of linked to that point is that um, obviously what they're seeing is for SMEs and SMBs, you know, the, how they obtain their payment services is changing. Whereas it may have been previously from a traditional bank or acquirer, now it's through typically a software provider of some sort. It's integrated in the vertical software that they're Using uh, and that rotation is now um, ongoing in the U.S. it's a huge trend. Do we see the similar trend in Europe?

Speaker B: Yes we do. I mean the market in Europe, I mean this has been happening in the US for uh, for the best part of the last decade I would say in Europe this game is um, a bit uh, newer, but the trend is the same. I mean we're not reinventing the wheel. So what's happening is the following. So you have companies, you mentioned SMEs, you mentioned, I mean smaller companies. And basically these companies, they need uh, to digitize and they need to grow. So they need tools, they need partners. So they just, they don't just need somebody who is providing financial uh, services or payments. They need somebody who is able to give them the tools to grow in general. That's why they are looking at these ecosystem players, software providers. And what did these guys do? They are building let's say the operational system for these kind of companies to operate in. And on top or let's say embedded in this system, they provide financial services, so they provide payments, they provide financing, they provide all kinds of uh, uh, all kinds of services uh, that the company needs. That's why I'm saying that these are mostly software companies and what they do, that they integrate the embed, which is uh, uh, why I mentioned before embedded finance. So they embed financial services in a flow that's very, very different. And you do this on a, normally you do this on a virtual basis. So you specialize, you understand very well. Right. What are the needs, uh what are the features of a specific segment, how do you properly service them, how do you successfully address their needs and then you can take it from there.

Speaker A: Yeah, absolutely. So these trends are all very common, have a lot of overlaps, right? You know, embedded finance software, LED payments, verticalized, uh, software, um, ecosystems. And they're all driven through partnerships essentially and enabled through API integration as well. Um, so, and then you know, I think as you pointed out there is this, the ecosystems establishing operating platforms for small businesses with various tools, one of which is payments. But um, and then we're seeing I suppose some of the traditional payments, um, companies, providers looking to assemble similar value added services. So they're all moving in the same sort of direction.

Speaker B: Would you agree? Yeah, I would say this is the uh, it makes a lot of sense. I mean this is the ecosystem play, right? It's not about, it's not about providing only particular uh, service or a particular, let's say payment method or a particular financial Tool to the companies but being able to service their needs in a holistic way. Mhm. That's why I'm saying okay, you may have started. We see that we have companies, we have fintech that they may have started from a specific core but then they move on to service other needs. And they do so either by building the capabilities on their own, which takes time and effort and it's not a very easy thing to do, or they service this by partnerships which is uh. And then of course uh, that's why you uh, you see the, the need for working with banks, for working with uh, fintechs that have expertise on the risk side, on the compliance side, on the operational side, depending on uh, on the vertical. I think this is uh, the, the ecosystem play something that we see on the market. Uh, and it's one of the big turns I would say.

Speaker A: Cool. I think I agree with you there totally. Uh, I think that's a big trend and it's quite clear it's moving um, in the right direction. One of the other big um, sort of embedded finance plays that was spoken about a lot, um, still is banking as a service but it's come under a bit of pressure of late um, with regards to some banking as a service partnerships that have perhaps not gone right, SYNAPSE bankruptcy, um, for example. What's your take on it at this stage?

Speaker B: Um, great question. I think we need to start from understanding what is banking as a service. Right. It's nothing more than the software as a service principle in banking which we call bus. Right. Banking as a service. So banking has been replacing software but I think and the need, I mean you had two drivers uh behind this. I mean the first one is what I say that the coupling of the backend from the front end then the need to open, have open, scalable, flexible, efficient and modular setups. And which is why the majority, if you look at the evolution and the history of uh, fintechs, most of the fintechs were built on the back of this bus model back in as a service basically using the infrastructure and the licensing of partners. Why they can focus on the customer relationship. So what they know best, they focus on the business side. Right. Um m. Now um, so basically the BAS model, the other thing that we need to understand is that the bash model is in very close relationship with what we call embedded finance. And what's the difference? I would say that you have embedded finance being the outcome, what you see as a client and then you have bas which is sitting at the bottom, at the Infrastructure level which is feeding into these embedded finance offerings on the outcome side. And then that's a quite good way of describing it.

Speaker A: Huh. So the embedded finance is almost the user experience, the customer experience, the outcome lens.

Speaker B: Exactly. But the enabler, the infrastructure side, which can be the licensing, which can be the uh, infrastructure, which can be the risk compliance is sitting at the bottom. Uh, and then what has been happening is that you have, let's say, so you have brands managing the customer relationship, the embedded finance outcome, you have the licensing piece, mainly certified banks at the bottom and then in the middle you usually have some technology providers connecting components. So that was roughly the model. So because you mentioned uh, synapse, uh, from the US this was on um, one of the first and leading, I mean they were what we call, I would say full stack platform provider, uh, an end to end bus player. They would take care of all the backend stuff on a modular basis and then they would rely on the banks for the licensing piece. Now this model has been working quite well until they were, I mean these kind of players. And it's not only synapse, uh, they were challenged by increasing regulatory uh, scrutiny. Right. So you have Rails for example, uh, you have other layers as well. Uh, and as a result what we have seen is that many of these bus providers, the fintech clients, they left and they basically sought uh, direct relationship with the banks to mitigate the risk of their bus provider going out of business, as we have seen on the, on the cnapp side. So I think what we see today is that uh, the previous setup uh, that we had with banks simply uh, outsourcing compliance plus middleware platforms or these kind of players or other fintechs, uh, this is gone. So regulators are now holding banks accountable for the actions of their partners and providers. So they need to make sure that they have proper due diligence, risk management in place. In every step they get controlled. So that's the big things that we see.

Speaker A: But is there a slight difference right in the US versus European model, to the extent that the SYNAPSE in Europe would have required an E MONEY license, E MONEY institution license, whereas in the US they didn't. They could just partner with a bank who is the regulated entity and rely on the bank for all the compliance. Um, but in Europe it's a kind of more stricter regime, regulatory regime, um, does that make a difference do you think in terms of the future of Baz in the 2M regions?

Speaker B: I think it used to make a difference as you said, but now I Think if you see the, the, the trend, I think we see a convergence. If you look at what's uh, happening in the US if you look at what's happening in Europe, we see the same trend. Meaning that these, Right. Um, stricter regulatory scrutiny. Yeah, with difference of course, but it's taking place in both, uh, uh, in both geographies. So I think there is a wider that we see.

Speaker A: Yeah, I think we've gone through a phase of relaxed regulations to encourage the entrance the new entrants. Right. And the increased competition. Uh, and then it seems to be cycling back into increasing scrutiny, uh, and tightening regulatory policy with regards to license application taking a lot longer even in the Europe, you know, um, and then the reporting and the compliance requirements and the investigations are getting, are increasing, uh, on those regulated entities. So compliance is becoming more costly.

Speaker B: Is that fair? Definitely. Compliance is becoming more costly. It's not only a thing of the banks anymore, it's also a thing of the fintechs. Uh, you see many fintechs that. I, uh, mean if you look at the early days, there is a huge difference because then back at the time you see that fintech, they were not focusing on compliance. Right. Uh, it's only the, the growth metric. And now uh, if you see the developments, the latest developments, uh, you know, you see uh, regulators filing fintechs for not being compliant across markets. So they have now to put emphasis on um, this kind of stuff on risk, on compliance. Uh, and this is also influencing their partnerships. So this is something that they need to do. So it's becoming a necessity. It's not something, it's uh, but you, it's a, it's nice to have, It's a necessity. So now they, they need to, uh, they need to, to have all these bits and pieces internally in place. Um, and it's a big change.

Speaker A: And I see some fintech perhaps trying to avoid the whole compliance issue by becoming just, you know, tech vendors essentially. Right. Um, technology vendors are not really participating or trying to limit that participation in regulatory regulated activity as much as possible.

Speaker B: Uh, do you see that? Yeah, but at the end of the day, I mean it's what I mentioned before. So you've had banks outsourcing, let's say the compliance piece to partners and then they were saying, okay, it's not us that is, uh, that has to do. And that's now gone. So what I think is that um, if you are uh, into a business segment and you need to deliver a business outcome, at some point you need to do it either on your own or via partners. And the question is how um, much dependency do you have on partners? And then of course if you're working with partners again it doesn't mean that you don't need to do any of this stuff uh because uh, to provide any kinds of services, as you very well know, you need at least for example uh, a payments license, uh, or uh, other kind of licenses. And I think most of these imply that you need to comply uh, with at least a minimum set of standards. So it's not even for technology companies. I think the game has been becoming more demanding uh, and more difficult on the compliance on the regulatory side.

Speaker A: Okay, Panayotis, I know you're a prolific writer on LinkedIn. In terms of your insights and thought leadership. What are the latest trends that you're most excited about?

Speaker B: I think uh, we see uh, I mean I mentioned at the beginning I think we see. Of course, uh. I don't need to mention. I think we see AI which is a big topic for everyone. Uh and I think the need there is as I mentioned before, there is a need for organizations to be able to navigate, to understand how they do it. So there's lots of need for support in this space and there are not many companies who can um, uh be through uh, partners and providers. I think that's one piece. Then you have data analytics which is becoming, I mean yeah, they will say, I think this is a, the combination that is uh, becoming a big booster partnerships that we are discussing today I uh think is going to, is going to stay. And then of course we have new uh business models. I mean we're discussing a bit touching upon appended finance today. For me this is one of the, of the big uh business models that will be driving also the industry going forward. So it's not something that is uh, you know it's uh, it's not something that is only a trend for a couple of years but uh, it's a real driver or uh, for growth. And uh, for me it goes together uh, with uh, banking as a service because as I said these are the two sides of the same coin. And then you have open banking which is becoming uh. I mean it's moving to open finance. I mean in Europe we see lots of regulation around this. Uh so there is ah, I think there is a renewed um, energy uh in this space, uh, that we see. I think there's lots of potential on the B2B side, especially on the payment side, uh, uh, lots of good business model and lots of lots uh, of potential There and of course the marketplace is the platform, I mean the marketplace and the platform model. Uh, because of all the things that we mentioned before, uh, I think it's going to continue to gain insignificance. Uh, software we discussed today, I mean software is becoming thing whatever you do. So you need to take this into account, uh, either by the form of partnerships or how do you deliver, how do you deliver your uh, product, your service to the end clients. Um so I think these are kind of, let's say uh, as I said these are things that are going to be uh, moving uh, the industry uh, going forward. For me at the end of the day I think this is a balance that you need to keep between innovation and sustainable, profitable, being able to do sustainable uh, profitable business. And as we have discussed before it doesn't go without saying so I mean there are lots of uh, lots of players, lots of fintechs that they are advertising innovative stuff which is good and that we are doing the one or the other thing in a new way. And there is a lot of uh, excitement created uh, around the business model. But at the end of the day you need to be able to do this in a profitable, in a sustainable way. That's what we see from time to time. We see the one or the other uh, fintech announcing results and then all of a sudden we, we are surprised that they are uh, not uh, having let's say the level of uh, sustainability that we thought uh, they have. I think it goes back to our original discussion. Um, yeah, mhm.

Speaker A: I mean it's interesting isn't it? So, so then they kind of draw back and focus on their core offering perhaps. Right. Um, they venture too far into, into building other value added services and expanding their portfolio and addressing different um, stakeholders and ICPs, um, and you know, and then they lay down some bets and they don't necessarily work out and so then they withdraw back to their core offering which is kind of counter to what we've been discussing which is building this ecosystem but beyond your core payment offering.

Speaker B: It's true, but, but you need to be able to do this in a profitable way. So that doesn't mean, so I think the challenge is that you need to be able to keep your core business. You deliver the results and gradually you build an offering. The way, I mean the way that you do this has to balance both areas. Right? So and that's the real challenge. You need to find the right um, recipe as how to do this. And of course if you're doing something which is Going beyond, which is going beyond your core expertise related challenge of uh, you know, expenses of costs of doing something that you don't uh, really know your partners, maybe you need to partner with banks, etc. Etc. So that's why the core needs to be there, it needs to fund the whole business. And of course uh, if you are to do something, uh, you know, this new activity, there has to be a horizon so you're not doing something that is uh, I mean there has to be also a sustainable element, uh, sustainability element, uh, in this new uh, business. And if you're, if you're building an ecosystem plane, what I think that you're going to find is, I mean there are synergies between your core business and this existing place. And at the end of the day you're creating added value for the, for the customer. So if you're creating added value for the customer, you're going to see adoption, you're going to see also additional uh, revenue. Uh, of course not to the, to the extent that your core business is doing today, but there has to be again sustainability element in the, in the new business and that's the balance.

Speaker A: Um, I suppose my question, let's, let's start off with this final part of the podcast. Um, what is sustainable growth? You know, how do you, what is the key metric would you say?

Speaker B: I would say that you are uh, having a core business, delivering on the goal of the business. It's profitable, it can drive growth. Uh, most of the times you're talking not about growth, uh, that is excessive. But is growth, uh, that is balancing, uh, let's say the innovation need and the need also for being compliant, for having, let's say an adequate due diligence, for working with regulators, uh, investing in additional technology, uh, understanding, let's say uh, data, um, this kind of stuff, uh, make partnerships, understand uh, what is the role of new business models, understand the role of software that you mentioned before. So what are the challenge, the additional challenge for me to grow my business? How much? For example, partnership is an element. I mean if I'm a small business startup and I'm starting my money, I have a, a very fresh and new business. Maybe it makes sense, it makes a lot of sense for me to focus on partnerships until I can uh, uh, have my own uh, let's say sales, uh, uh, yeah, um, set up. I mean the thing is to be realistic, to set realistic goals. Yeah, right. Because if you set realistic goals then you can uh, grow in uh, phases. I think that's, that's One. And the second thing is that I think um, if you look at the metrics, if you look at the KPIs that you set for yourself, for yourself, there's always a message. I mean you can feel, you can understand how the business is doing from a few metrics. So I think uh, especially for young companies, uh, they need to be able to pivot, uh, and to make the necessary changes early on. You don't need to wait if something's not working. You need to very quickly pivot, uh, the business, understand how to make it profitable. Maybe there are some lessons learned. I mean there are lots of examples of companies that started on focusing on specific niche and then they peopled it onto something very different only because they realized in the meantime that this is what can uh, lead the sustainable and uh, profitable business model. So I think you should be, as a business, and especially as a young business, you should always be ready to pivot and adjust your business model, ah, quite fast. Uh, otherwise, uh, I think the market is not going to wait for you.

Speaker A: Yeah, totally groove. And I think often I, I've observed it's around um, pivoting around your, your, your target customer segment, you know, um, and finding traction in the right segment, in the right niche, um, and establishing whether or not you need to go broader, more narrow in a different area.

Speaker B: What I've seen happening, ah, quite often is for example you have businesses, you have fintechs, uh, starting off with a, with a B2C offering. And then the people, they move on to the B2B side because they find out, they understand that the competition is less opportunities, more margins are better and uh, there is more need for um, for uh, well rounded um, offerings.

Speaker A: I agree.

Speaker B: So the B2B space, you know, you're

Speaker A: more favorable to B2C. But then there's obviously the overlap, that interesting space, but the SME space or even micro SMEs where they share quite a lot of the characteristics actually in terms of buyer Persona or the consumer. Right. Um, yeah, but they're, they're a business. So that often is quite an interesting space to look at.

Speaker B: There are still businesses and the challenge there is that you need to be able to automate your servicing of these businesses to a large extent, otherwise it cannot be profitable. And that has been for example the main challenge on the banks in this space. Uh, they have not been able to understand the needs of the, of these small companies in a profitable way and in a way that uh, make sense for them. So now that you have all these new Tools, the technology, AI and the data and the analytics. That's an opportunity to service these businesses um, in the right way. I mean the medium sized businesses, the small businesses. But then of course uh, scalability and automation. I mean you cannot do this manually. Right. There needs to be a certain way and level of uh, automation. That's the key for being successful in this segment.

Speaker A: All right, final, final question on the topic of AI.

Speaker B: I mean I'm of the opinion that uh, AI is an enhancer of uh human abilities. So I think uh, what you're going to see is that you're going to see AI and I think that's what we have uh, started seeing uh, as we speak today. So you're going to see the low added value tasks uh being completely maybe outsourced or done by AI. Mhm. And then when you um, when it comes to additional uh, to higher added value services to that need also some kind of human touch. You're always going to have humans enhanced by uh, AI. I think uh, the, the uh life cycle and the value chain is going to probably change significantly but uh, some of the stuff again at the lower end of the, of the value chain will be maybe fully automated.

Speaker A: Yeah.

Speaker B: But uh, I don't think it's going to be to the detriment of uh, people. I think you're wrong. Just simply it's a move that will uh, that is actually taking uh place as we speak. So you're moving to the uh, other part of the value chain uh with some modifications. That's my opinion.

Speaker A: Okay. No, I think I tend to agree with you. Obviously there's a lot of requirements, repeatable uh, rules based tasks that can be automated and driven by AI. But I think there's still going to be a need for that white glove service. Right. Um with, with the human touch that people still value um, in specific areas where they think of this additional complexity that AI. You know. Still a bit concerned about relying entirely on AI. Certainly am.

Speaker B: So it very much depends on the importance. I mean if it's a life uh kind of decision, I mean if I, if it has to do with a mortgage loan. Right. I take a mortgage loan probably once in my lifetime, maybe twice. Right. So I will need to have some kind of human interaction. I mean maybe most of the stuff behind or some of the stuff behind has been done by, has been automated. But there is an expectation I think most of the cases to have a human interaction. I think this is the big differentiator.

Speaker A: All right. Paliotis. Um, thank you so much for your time today.

Speaker B: It's been.

Speaker A: It's been great speaking to you again, and, um, yeah, uh, look forward to the next time.

Speaker B: Thank you, Martin. Thanks for having me.

Speaker A: Cheers. Thanks for tuning in to this episode of the Scalepoint Podcast. Don't forget to subscribe, leave a review and follow us on social media. You can also find out more at our website, which is scalepointpartners.com that's it for today. See you next time, and take care.