Only hours before he was to make a presentation about his startup business, Greg Ellis decided to change the focus of the firm, Mortgage Peer Network.
Ellis was preparing to go through the final round of qualifying for one of 10 spots in the FIS FinTech Accelerator program in Little Rock.
Ellis, 47, talked with Lou McAlister, a mentor with the Venture Center and a successful businessman, about his presentation and the concept of the company.
“We decided the entire concept of Mortgage Peer Network needed to pivot,” said Ellis, founding partner of the firm, based in North Little Rock. “We inverted the entire idea of what [the company] was about. Then I realized I had to redo the entire investor pitch and be back [downtown at the Venture Center] in two hours.”
Ellis’ firm and nine other financial startup companies were announced on May 16 as participants in a 12-week program collaborating with the Venture Center, which is hosting the program, and Fidelity National Information Services Inc., better known as FIS Global.
The FinTech Accelerator gives the companies access to some of the top executives at FIS Global. The program is designed to quicken the growth of earlystage financial technology companies.
Jacksonville, Fla.-based FIS has about 55,000 employees worldwide and 1,300 employees in Little Rock, where much of FIS’ research and development is done. It has about 20,000 clients, more than $7 billion in revenue and about 35 million users of its mobile banking products.
Ellis read about the accelerator program in December when it was first introduced by Gary Norcross, FIS’ chief executive officer.
“Not being around these sort of accelerator programs, I really had no idea what this was all about,” Ellis said.
So Ellis called Gary Dowdy, managing director of the Venture Center, and asked about the program.
Dowdy was surprised that Ellis lived in central Arkansas.
“He lived 10 miles away,” Dowdy said. “We were getting [applications] from Africa and we didn’t even know about him.”
Ellis worked for First Commercial Mortgage until it was sold to Regions Financial in 1998. In 1999, he started Precision Risk Management Systems, a mortgage risk management company.
But he had an idea for Mortgage Peer Network, which was founded in April. It is a customer satisfaction survey system.
It helps mortgage lenders generate leads by utilizing changes in lending through social media, consumer buying habits and complex regulatory rules.
“It is so different than anything we’ve done that we wanted to bring it to market as its own brand,” Ellis said.
The Venture Center had expected that most of the leaders of the selected companies would be relatively young, Dowdy said. But several are in their 40s, including Ellis, Dowdy said.
The youngest — a founder of Monotto of Charleston, S.C. — is still a student at the College of Charleston.
Christian Ruppe, CEO of Monotto, lacks six classes before he graduates. His cofounders, Jared Kopelman and Hank Stocker, graduated this year.
Monotto is a personal finance program that determines how much money can be moved from a customer’s checking account into savings or investing accounts.
“Then it automates the process of doing that to reach their financial goals,” Ruppe said.
The three developed Monotto last fall in an assignment for a college entrepreneur class, which had a prize of $10,000 to the winner. The business idea for Monotto won the competition but they still got a B in the class because they didn’t do the work for the class, Kopelman said.
“I came into this [accelerator] program 100 percent committed to [turning the idea into a business],” said Ruppe, 21.
They were told about the accelerator program in Little Rock by a mentor, Ruppe said.
“We know we are college students and we know there’s experience we don’t have,” Ruppe said. “We wanted something where we could get that experience, but be highly focused in the area we’re in.”
Ruppe and his co-founders already have a goal of having 2,000 Monotto users, mostly college students, by the end of the 12-week program.
Monotto is working on another portion of the business to address paying off student loans, Ruppe said.
“Your financial habits — good or bad — are formed when you’re in college,” Ruppe said.
Chicago-based Akouba was formed two years ago to help small businesses get access to capital, said Chris Rentner, Akouba’s CEO.
Akouba is a Greek word that means to reach out and touch, Rentner said.
“We provide our software to the banks, who have cheap capital” as opposed to online lenders who charge extremely high interest rates, Rentner said.
Akouba provides technology to banks that gives customers a digital avenue to apply for loans.
“Now [small businesses] can [apply] anywhere in the world, anytime of the day,” Rentner said.
Akouba’s software gives banks access to two or three years of income information from the IRS, after the potential borrower agrees to allow the data to be accessed. It’s all in digital form, Rentner said.
“We reduce the costs to the banks to go through this process by 50 [percent] to 70 percent,” Rentner said.
The reason Rentner wanted to participate in the accelerator program was to help Akouba increase the number of banks it works with from dozens to hundreds.
“FIS and the Venture Center team have been amazing,” Rentner said. “Even just the first 10 days or so being here, they have truly brought knowledge to our business and value to the company that I think we will see in the future.”
Rentner holds a video conference call at the end of each day with the other eight employees of his company in Chicago to let them know what is happening at the accelerator program.
FundSeeder, based in Westport, Conn., focuses on the hedge fund market, said Emanuel Balarie, the firm’s CEO.
FundSeeder’s software allows anyone to have their stock data and trades tracked daily and even compare their trading against other traders’, such as hedge fund managers.
The other founders of FundSeeder are James Bibbings and Jack Schwager, author of the Market Wizards book series and an expert in futures and hedge funds.
“We’re disrupting the hedge fund management industry,” Balarie said.
The old-school belief is that Wall Street hedge fund managers are the smartest investors, Balarie said. About 500 hedge fund managers control about 90 percent of the $1 trillion in hedge fund assets, Balarie said.
“But with the advent of technology and the free flow of information, that belief is a little bit outdated,” Balarie said.
FundSeeder is trying to develop a farm system of up-and-coming hedge fund managers, Balarie said.
“There isn’t a way for the average person with a trading account to become the elite of the trading world,” Bibbings said. “That’s literally impossible. But we’re trying to give a shot to the little guy to upset the Wall Street model.”
About two weeks into the accelerator program, participants say they are pleased with the training they’re getting.
“This is so different than anything I’ve ever done,” Mortgage Peer Network’s Ellis said. “I’ve always been laid-back. But this is up on the edge of your seat, rapidfire kind of stuff. I am being forced through processes that cause you to think differently than you thought before. When you’re forced to do things a different way, you grow.”