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Interview: Uldis Tēraudkalns of Nexpay

Uldis Tēraudkalns is the CEO of Nexpay, a fintech startup based out of Lithuania. Nexpay is one of the fastest growing Lithuanian fintechs, and in the top 5 in terms of transaction volumes. Uldis is also the host of The Pursuit of Scrappiness, the most listened business podcast in the Baltics. As its co-host, he has had the opportunity to pick the minds of the the Baltics’ and Europe’s hottest startups and scaleups, but also many new, up-and-coming founders and guests from the likes of Intel or Mindvalley.

How did you end up in the world of startups?

My professional career started in corporate banking and private equity. It is probably a pretty typical path for those founders who are now advancing their fintech startups.

After my undergraduate degree at the Stockholm School of Economics in Riga, I had some experience in corporate banking at SEB. Having always felt the limits of big corporations and traditional banking were too narrow, I moved to Stockholm to get a master’s degree in finance.

After returning to Latvia, my journey into the world of blockchain and cryptocurrencies began, so a fintech startup was a logical extension of this quest. At the same time, working in private equity has introduced me to different types of companies and leadership styles, and I can now apply this experience as I stand at the helm of Nexpay. 

Tell us about The Pursuit of Scrappiness. What motivated you to start it?

We launched the Pursuit of Scrappiness together with my co-host Janis Zeps in March 2021 as a hobby primarily. And now we are approaching almost 100 episodes.

Initially, the idea was to talk with Baltic startup founders and business leaders about their secrets of success and valuable tips, perhaps to inspire somebody by our guests’ examples. The scrappier, the better – “actionable insight for anyone” is our top priority. We have deliberately made our podcast in English to be in tune with the wider European startup community.

Not only to be able to invite guests like the founder of Mindvalley Vishen Lakhian or even Intel’s CFO David Zinsner (yes, we had them on the air), but also to expose the Baltic founders themselves and our startup “kitchen” to the world to a greater extent.

After almost 100 episodes, what were the biggest findings from speaking to your guests?

Baltic unicorns such as Bolt and Pipedrive have been represented, as well as up-and-coming startups like Jeff and Fractory. Investors, particularly VC and angel investors investing in Eastern Europe, can be frequently found on the pod. 

We’re expanding our focus more broadly across Europe but don’t exclude notable global guests. Janis and I are certainly trying to be serious, but sometimes, the show feels like the equivalent of a whiskey conversation between friends, a more relaxed, authentic approach that seems to work well.

Perhaps our most remarkable finding is that the scrappiness can be found in more than just “unicorning”. Even failed trials and setbacks are also achievements in your life’s piggy bank. We’re aiming to talk to our guests not only and not so much about business but also their lifestyle and values, family-work balance, and personal growth.

By the way, one of our most successful episodes was not about business at all. It was with Aigars Lauzis, the Founder, CEO and Designer of BeTRITON – an amphibious camper-trike, namely a vehicle that lets you drive on the road and sleep on the water. How could anyone think of such a thing? As it turns out, the inspiration for creating this staff came when Aigars decided to cycle 30000 km from London to Shanghai.

Our guests’ unconventionality, uniqueness and creativity are what precisely inspire us as hosts and what we want to share with our listeners.

Is there something that you would say characterises the Baltic founder?

More often than not, “scrappy” and a tendency to think globally are precisely the words that can be used to describe the Baltic founders in the sense that they always have to think about achieving maximum results with limited resources.

Historically, that might have been because of the narrow market size and restricted availability of venture capital funding. In general, as for me, founders in the Baltics are also more down-to-earth. What really matters to them is the result, not only the process – making more money first instead of just spending it.

How valuable is podcasting to communities such as startup founders?

The Baltic startup ecosystem as a whole is a defined network and a fairly tight community, where if you don’t know someone personally, you definitely are able to get them through a handshake or two.

So, we like to think that PoS is one of the public voices of such a community and a kind of stage for exchanging views and experiences. Starting your startup, like launching any business, as well as navigating your team through perma-crisis, is a real challenge. And it would be best if you weren’t alone along this way. You have someone to look up to, to lead by example, and to ask for advice. That’s the goal of our podcast – so that everyone can find their scrappiness.

Let’s switch to Nexpay now. What does Nexpay do, in brief?

In short, Nexpay is a fintech startup that provides banking infrastructure for digital businesses. Our API enables businesses to offer their customers seamless integration between Nexpay and their systems, leveraging a range of payment, account, and other products developed by us.

With our banking and industry experts team, we aim to help our customers build new solutions with reliable, convenient, and robust alternatives to legacy financial institutions.

Nexpay is a licensed Electronic Money Institution authorised and regulated by the Bank of Lithuania.

What type of companies does Nexpay serve exactly, and why don’t banks want to take them?

We provide banking services and infrastructure for the digital assets industry, forex providers, and gambling and gaming platforms, and other online industries.

To date, Nexpay is processing over €2 billion annually, and we have helped over 600 businesses build what we call the future of digital payments infrastructure. These are challenging times for the economy, especially for digital assets, but we believe the future of money is closely intertwined with technology.

And I’m excited about the role we are playing in empowering fintech companies and other market participants to drive innovation.

What have been your biggest challenges with Nexpay? And your biggest victories?

Nurturing a fintech startup in today’s economic perfect storm, every victory is like conquering Mount Everest, while every mistake can lead to a Titanic situation.

Probably because of my Nordic character, what is important to me is not certain leaps but systematic thinking, measured approaches, and strategy in my work. This approach has enabled Nexpay to achieve a €5 billion value of serviced payments as of July 2022, operating in more than 30 countries across a range of different industries.

How would you assess this difficult moment in time for the digital assets industry?

What today many observers call “crypto winter” is nothing more than a particular cyclical nature of cryptocurrencies, which means its popularity rises strongly in growth periods, and in slower periods, the curve isn’t as drastic. The current devaluation – about 75% at the lowest point so far – is just the latest in a series of wild price gyrations.

In 2013/14, bitcoin declined from $1,127 to $172 (85%). In 2018, the collapse was 80% from the peak. It’s fair to say that the intensity of these waves has been hair-raising for anyone holding cryptos. 

What differs in the current situation from the previous cycles is that our entire world is broken geo-politically and economically. We are living through events that happen once in a lifetime, and we are experiencing multiple such events simultaneously. So it would not be a surprise if the current down-cycle lasts longer and is even more erratic than we’ve seen before. The overall feeling is more extensive uncertainty than usual, with investors searching for the appropriate actions to circumvent that. 

Bitcoin investors who have been through a couple of cycles went into this cycle expecting the previous pattern, which hasn’t happened, and thus the future price movements for Bitcoin and other cryptocurrencies are very unclear. 

For other digital currencies, of course, this effect is similar, only multiplied, as Bitcoin, the flagship digital currency, is assumed to be more stable than the other coins.  Possibly the fact that we have a more developed crypto market than during the previous cycle plays in the dynamics of this cycle as well.

Why did you choose Lithuania for Nexpay? Was Latvia a consideration at all?

When we launched Nexpay 5 years ago, in terms of fintech and general business legislation, Lithuania was much more advanced than Latvia. The local fintech sector has built a reputable brand, and government policy has helped Lithuania establish itself as a fintech-friendly country in terms of regulation and the entire ecosystem.

The Bank of Lithuania has increased its competence to oversee cutting-edge financial services. Thanks to the country’s advanced regulation, a large number of fintech sector participants have operated in the country, creating one of the best ecosystems in the world. Not just the licensing but also the payments infrastructure that the Bank of Lithuania offers is also the best in Europe, attracting many companies.

Currently, the situation in Latvia is much better, but still, for the fintech industry as a whole, Lithuania remains at the top of the list.

If you could change one thing about the Baltic ecosystems for the better, what would it be?

I think a broader cross-Baltic collaboration to encourage business between the countries could be beneficial. Of course, due to the EU, we have seen this to some extent, and right now, it’s easier to move between countries than ever.

However, I would like to see more examples of all Baltic countries working together to make it even easier for businesses to move across the region. Lithuania has had a good track record of attracting the fintech industry. Estonia took the top spot for the 5th Anti-Money Laundering Directive as the country with the most advanced regulation and more straightforward setup.

Adoption of crypto regulation here combined with ease of doing business, accelerated by the e-residency program. At the same time, Latvia has had a fair share of success stories in attracting and growing considerable business successes. There is a potential for working together to attract businesses to the region instead of each country fighting for itself.

What’s next for Uldis, Nexpay and The Pursuit of Scrappiness?

Although Nexpay already has an established brand in the markets where we operate, there is still a lot of market share to grow, and that is what we will focus on, offering new products, excellent service and long-term relationships.

The podcast is nascent, with a dedicated audience and a well-defined niche. We are looking for ways to expand the audience, deepen the quality of the conversations and overall make an excellent educational and entertainment product.

As for me personally, I’m motivated to keep building our teams and adding fuel to this fire.

What is the best way for people to stay updated with the latest from you?

You can subscribe to my personal Twitter and LinkedIn accounts, as well as on updates from Nexpay (Twitter, LI, Facebook) and Pursuit of Scrappiness (Twitter, LI)

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