I promoted version seven of our No-Code fintech Million Deals to the live server yesterday afternoon. There it will sit quietly, busily testing the cost of customer acquisition and gathering UX/CX data. It will stay live for the next few weeks while we decide what version eight will look like. If you want to sell your business we encourage you to go and give it a try. It's completely confidential and utterly free. We stopped trying to earn money out of it a couple of versions ago.

At one point we considered the Million Deals project to be a failure, but its story is at the heart of Million Labs DNA. It taught us some incredibly valuable lessons that have allowed us to succeed as a company. Here's the history...

Let's Build a Challenger Bank!

Back in April 2018 I'd just finished an enormous project working for a Russian Investment Bank. I had spent the preceding three years constructing a retail savings division and engaging in the cut and thrust of applying for a banking license here in the UK. I took a couple of months off and then decided "hey, let's do it all again!"

After a quiet breakfast in a pretty grotty Warwickshire hotel we decided to build a financial services company that would deliver the services and funding required to acquire an SME company in the UK. Our USP would be our ability to use technology to streamline the outdated process that business owners currently endure if they want to buy or sell. We would take on the 'evil incumbents!' and capture a profitable niche for ourselves in an otherwise grossly outdated backwater of the British banking industry.

It's worth dwelling for a moment on just how awful our competition is in this space. 'Business Agencies' are the last bastion of overweight, middle-aged white men who play golf to win business, drive a Lexus and still secretly enjoy a good old-fashioned racist joke. They fail to service 95% of the customers they over-charge. They are supported by a corrupt professional services industry and the bit of the banking sector that actually engages in criminal activity from time to time (rather than everyone just thinking it does).

Anyway, we submitted ourselves to an initial meeting at the Bank of England with the lovely men and women of the New Banking StartUp Unit in March of 2019. That was a fun day - our proposed Chief Marketing Officer Mike got thrown out - but in general it went well! Then we set about working through a plan to nail a bank together.

If you want to build a licensed bank you need to raise about £50m. I've heard lots of people say it can be done for £20m... but none of them have successfully built a bank. Once you're accepted for a banking license you'll almost certainly need another £200m to scale and meet the various capital thresholds required to trade sustainably. So we knew we'd need to... you know... meet some investors.

Let's Build What We Can While We Wait for The Money to Show Up!

While the slow pitching process went on we decided to start building and testing the things we could without a license. When you tell people you're building a challenger bank every hand in the room rockets out... there are lots of opportunities to hire expensive bodies and build systems you aren't going to use (yet). We pared everything back to the first thing we needed to prove: could we win customers.

Simon will roll his eyes at this, but I want to tell you about my "Grand Banking Equation" (a deliberately pompous name). This is the model I use to assess the business case of other challenger banking propositions.