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We talk to Matt Franklin – CEO of Payaca about building better digital products

Author: Harry Cobbold

Welcome back to Spotlight – our series of interviews, articles & conversations with some of the very best people, organisations and businesses working in the digital & startup space. This time we’re chatting to Matt Franklin, founder of Payaca about his experiences building digital products at Payaca.

Thanks for joining us today Matt! Can we kick off by hearing a bit about what does Payaca does?

Sure, so Payaca started when I identified a key problem in the home improvements space. I noticed there was a high demand for spreading the cost of work with a high upfront expense (e.g. a new bathroom). Before we started Payaca, only the big companies were able to solve this problem for customers by providing finance (given how many regulatory hoops there are to jump through). These big companies typically also charge much higher rates just for the premium of working with a big name and then outsource the job to other businesses.

It felt to me like there was a really key problem to solve for multiple sides of the market. We’re solving these pain points by allowing customers to work directly with independent businesses who provide better rates and a more personal experience, without having to compromise on the financing issue.

We do this by providing software services to small independent service businesses allowing them to manage quotes, invoices and job management. We also build ways for the customer to spread the cost of the work straight into the software. For example, if a customer receives an £8,000 quote for a new bathroom they then need to consider how they’re going to fund that. With Payaca, right there on the quote is an option to connect to and search multiple lenders through our platform who offer really fast payment at great rates. The finance is then handled directly with the lender which means the business using our software doesn’t need to take on any risk or regulatory complications associated with the finance agreement.

Has the business changed much over the course of the last 2 years?

At a high level, it hasn’t changed that much – we’ve stayed quite true to the original vision because the assumptions we made at the start have continued to ring true.

On a more micro level, there have been a lot of changes and we’ve definitely learnt a lot as we go. We do a lot of trialling and collecting of data to learn about how customers are using the product. In the early days especially I spent a huge amount of time on the phone to customers learning about what they did and didn’t like about the product. This helped us understand specifically what functionality was required for our target segments. For example, we started out with a web app but small business owners are always in the field, so it was vital that we built a native mobile app they could use wherever they were. This differed from the slightly bigger businesses who either had admin staff or would spend a day in the office where they wanted to handle the invoices on desktop.

What kind of data did you collect to make those decisions?

It’s a real mix – the analytics from the app & website on what features customers are interacting with guides a lot of thinking but you have to combine that with talking to customers on a daily basis.

An early win for us was changing the primary CTA on the website to ‘Book a call’. It allowed me to personally welcome everyone onto the platform but also get instant feedback on the onboarding process and how they wanted to use the service.

As you aggregate those individual conversations with customers and combine it with the quantitive data you can build up a picture of your customers. It often shows you that people are using the service in a different way than perhaps you expected, so tieing both of those research streams together is vital if you want to really understand what’s going on.

Adding Intercom to the website was also a great help because it removes the friction for customers to ask you a quick question about the service and another avenue to collect feedback. Using all these channels to learn has allowed us to tweak the website and proposition continually to the point where people now sign up to the service without needing to be helped by one of our team which is great!

What has been the biggest challenge you’ve faced in building a digital product? How did you overcome those challenges?

I think the hardest thing for me is that I’ve had a lot of experience working with a large and very talented team of software engineers. I’ve experienced first hand how great and how much progress can be made when you have that talent available.

When I started Payaca I wasn’t in that position – as with any new business you’re light on funding so it was a case of working with some very talented individuals and agencies to get moving quickly and start building the product. Now we’re more established we’re continuing to do that while we also build up our in-house capability.

Responsive UI design on a mobile screen

How did you become an entrepreneur? Can you tell us a bit about your journey into entrepreneurship?

Previously I worked at OVO Energy as a Product Manager in Bristol so I have a lot of experience working on designing and building tech products. 

Why did I want to be an entrepreneur? In all honesty, I don’t really like being told what to do! I’ve always been a problem solver and enjoy trying to deliver a better service or create a more efficient system. I like seeing a problem and knowing there is a better way of doing something.

When I saw the problem facing customers and service businesses I thought I was the right person to go and solve that problem. I get a lot of enjoyment from working autonomously and getting a whole team of people excited about solving that problem too.

How did you spot the problem you wanted to solve?

My most recent role at OVO was in the home improvement space so I got exposure to a slightly different market there as well. It got me thinking about problems in the industry and many of my friends are both homeowners and tradespeople so that helped to validate the early idea as well. Once I dug into it I felt like I really had a unique position to launch the business as well – having in-depth knowledge of both sides of the market as well as experience building software.

It’s a hard one to escape at the moment, and a question everyone is trying to work out – how has Covid-19 impacted the business and how are you reacting as a founder?

It was certainly unpredicted! It’s had a big impact on the home improvements sector, with some work being deemed non-essential through lockdown so traffic is definitely down.

Lenders also don’t have good models for the current climate as they access the impact on different types of businesses. The result is that they’re being a little more conservative with their lending right now.

In terms of Payaca, we changed our approach away from marketing and sales and are very much focussing on improving the product. This has been really nice in a way as it’s given us a real run at improving the product and building new features without the usual distractions.

It’s also been frustrating though as we had to scale back our hiring plans both on the marketing and development side of the business. The good news is that we’ve just been able to pick this up again as the economy gets going again.

What are the tools/people/organisations which have helped you the most as a founder and as a business so far?

When you’re a lean startup you don’t necessarily have all the expertise in house to build and launch a service. That’s why we’ve worked closely with a few other very talented businesses and organisations which has given us the expertise and team very quickly to allow us to scale up. For others in Bristol I’d recommend:

  • Stephenson Law has been a fantastic help
  • Seedlegals –  a lot of useful resources around fundraising and beyond
  • Max from Backlash Build who has enabled us to execute incredibly quickly on the tech side

Is there anything you’d like to see added to the incredible information resources already available to startups in the South West?

Fundraising is one of the trickiest areas to navigate and it’s very hard to find good resources on how to approach it. People in fundraising aren’t always upfront with their intentions which can make it even harder to navigate, especially if you don’t have experience of raising money before.

I would also say that it’s really important to filter the feedback you get from investors. I’ve found that often tangental or anecdotal experience on the investors part gets applied to your business model and it won’t always fit. Being open to feedback is important, but making sure you listen to the right feedback is even more so!

I would recommend Bristol Private Equity Club (BPEC) on this topic too. They have a very broad set of experiences which has been really helpful for us, bringing in a wide array of resources and insight. We still need more of this in the South West though!

Who would you most like to see featured on this blog next?

Adrian from Lumio

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