Founder interview: Chris Larsen, CEO, Ripple

Continuing our conversation with Chris Larsen, the founder and CEO at Ripple – seen above being interviewed about Blockchain at the World Economic Forum in Davos – he tells us about championing the consumer viewpoint and offers advice for fintech start ups.

Record of success

Every investor is reassured by a founder with a track record of success and Chris Larsen brings a stronger CV than most to the Chief Executive role at Ripple. Larsen founded E-Loan, the online mortgage processor that was amongst the first to offer financial products over the internet. That success was followed by another with Prosper, the pioneering peer-to-peer lending business.

Larsen’s first businesses, E-Loan and Prosper, each took a consumer’s perspective. Each exposed different inefficiencies in the financial landscape that resulted in high costs and poor experiences for certain segments of consumers. In his latest venture Larsen has turned his eye to improving the core infrastructure of the financial services industry itself.

“My first businesses were at the top of the financial services stack whereas Ripple operates at the very bottom,” explained Larsen. “Ripple operates down in the plumbing of financial transactions. It’s an area that consumers would never consider, but improving it has the potential to change the cost and quality of the financial services they purchase.”

Today Ripple enables banks to settle cross border currency transactions instantly with complete visibility and certainty. This results in lower transaction settlement costs to the banks and their customers.
This approach means Ripple is essentially an enterprise business-2-business (B2B) company serving the financial services industry, not another business-2-consumer (B2C) operation like E-Loan and Prosper. As Ripple’s products have matured it increasingly partners with banks and other financial institutions in order to build its technology into the core processes of the industry.

There’s another significant difference. Providing B2C financial products to consumers meant E-Loan and Prosper were confined by their local markets, products and regulations, but as a technology provider Ripple is able to leap straight to becoming a truly global player. Global growth is the next phase in Ripple’s commercial strategy, one which requires both capital and the right partnerships in order to succeed.

Advice for fintech startups

As Larsen steers his third successful fintech business on its global growth strategy, he has advice for would be fintech entrepreneurs. “Take the plunge. Don’t hold back. The consequences of failure are usually much smaller than you think. But don’t be afraid to iterate your ideas as you search for that compelling mission for your business.”

Whether attracting talented personnel – or potential investors – a sense of belief and passion in the mission of the business is essential. “That’s the most important thing: belief in your idea. Whether you are pitching it to investors, hiring talent or selling to prospects, if you are not authentic they’ll see it.”

Momentum is also important to potential investors and employees, “No-one enjoys being part of a science experiment that just fizzles out slowly. If it’s not working, change. Keeping up the pace of change is vital and sustains a sense of excitement around the business opportunity. That energy is especially important to attract and retain engineering talent. The best engineers want to work on projects that make a difference.”

That’s a lot for any entrepreneur to sustain, even one with a great track record. Not surprisingly Larsen also advises that knowing when to broaden the skills of the core team and bring in missing talent or new experience is key. “That might mean hiring a practically minded operations director to complement the founders’ skills, or bringing on board investors who can add value above and beyond their investment.”

This is the second of two posts detailing our conversation with Chris, for previous the post, watch for links.