How long does the RA take?
A narrower and lower-depth RA with lower levels of required confidence can take as little as two weeks. More comprehensive RAs that require higher levels of confidence typically take a little longer, and timing also depends upon client responsiveness and availability. On average, we suggest to plan for at least 2 to 4 weeks if looking for 99FT or our investment partners like PEs to consider the results when deciding if and how much to invest.
What are the RA levels of analysis?
For each of the three levels of assessment, questions are posed, and their responses lead to more detailed questions. The rapid assessment generally stops at 2, and the comprehensive typically stops at 4 or 5. In addition, the breadth is typically constrained as well based on the level of analysis.
The questions are based on over 30 years of experience helping fintechs and their investors achieve real, measurable results and success.
Quality and Confidence
In addition to the quality of the answers themselves, the ability to answer each question with proof points also increases the score, as the confidence level and veracity of the response is factored into the score. Verbal answers score lower than those accompanied by documentation, which are scored lower than those accompanied by first-hand observation by the 99FT team.
Why is the Readiness Assessment so rigorous and required for most 99FT projects?
99FT’s willingness to invest time and/or financial capital, as well as our willingness to introduce our venture capital and private equity partners to a Fintech are directly tied to the Readiness Assessment score. Especially for capital raise objectives, we are not just scoring the Fintech’s readiness for principal milestone(s), we are also assessing its readiness to attract investors and be credibly presented to our partners with whom we have long standing, trusted relationships.
Gaps are not bad; blind spots are.
A known, recognized and well-articulated gap with a plan to close the gap demonstrates a level of readiness in and of itself. A lack of awareness, or willingness to disclose or detail gaps, and absence of well thought-out plans to close those gaps can be a major barrier to success and to attracting investment from 99FT and our partners. Trust and visibility will help the Fintech; 99FT and prospective investors will lean in to help the Fintech prioritize and sequence the gap remediation efforts (driven by nature/type of the fintech’s business, its overall maturity, etc.), execute on these efforts, and ultimately succeed. We are here to help and partner with the Fintech. But we can only do so if there is an effort and desire to acknowledge gaps so we can prioritize and apply that help.
Some clients prefer to have only a subset of factors assessed. While this is possible, it is important to understand that reducing the scope will reduce 99FT’s visibility into the broader organizational, project or product’s risk and readiness. Therefore, it should be understood that a narrower scope will result in a lower level of investment (for situations where client is seeking 99FT’s assistance in preparing for a capital raise with one or more of our investor partners). In some cases, the 99FT investment could drop from 75% to 25%, or even be removed completely when the RA scope is too narrow. At times we will offer to conduct a very narrow initial Assessment at a very low cost as an investment in our relationship with the Fintech or sponsoring company (e.g. a private equity firm).
It is also not uncommon for 99FT to offer the Fintech client or sponsor a broader assessment at a 25 to 50% discount. On these cases we ask that the company or sponsor return that investment if they choose to proceed with the assessment results without 99FT’s further involvement. This is because our goal is to be partners and/or investors, actively helping achieve the Fintech’s results, not just performing assessments.
Understanding your RA Score
Readiness Y axis, Confidence X axis. Top right = very ready, and with the highest level of confidence.
Once your company has been scored, a 99FT advisory partner will schedule a meeting to review the preliminary score and help you interpret the results. It is not uncommon for clarifications and adjustments to be made during, or as a result of, the preliminary findings meeting. In addition, it is common to only distribute specific sections (with or without sensitive redactions) of the RA findings to specific internal departments, functions, stakeholders and investors. If your company, the parent or major business partners are publicly traded, the release can also create significant risks such as SEC insider trading and other violations.