The founder and CEO of UK banking tech startup 10x Banking says he has never lost his short a.
This is not a tech reference but refers to Antony Jenkins’ northern accent, so he pronounces “bath” as “baff” and “path” as “paff”.
Born in Blackburn, the former Barclays CEO says his accent is an “amalgam” of the north and London and New York, the two cities he worked in during his high-profile banking career.
Perhaps his northern roots also account for him not being predisposed to self-aggrandisement or hyperbole- at no time during the interview does Jenkins namecheck his there-year tenure as CEO at Barclays until 2015 when he was ousted.
Barclays, anyway, is the first chapter and Jenkins, 62, is here to talk about the second chapter of his career, as a tech entrepreneur, the CEO and founder of banking tech startup 10x Banking, which he set up in 2016 at the spritely age of 54.
Software-as-a-service providers like 10x Banking and Thought Machine have, in recent years, been fintechs du jour, snapping up coveted clients like JP Morgan Chase and Intesa Sanpaolo, Italy’s biggest bank, whirlwinding legacy banks into the modern age with their cloud-based, silo-breaking banking platforms.
Sure-footed start to 2024
2024 has started sure-footed for 10x Banking after securing a multi-million-pound funding round and Jenkins is upbeat about the year ahead, pointing to a new 10x Banking product going live in the market, and big-ticket deals close to being signed around the world.
Currently, 10x Banking is understood to have six clients, including JP Morgan-whose UK digital bank Chase runs on 10x Banking software, Westpac, the Australian bank and Old Mutual, the pan-African financial group.
But Jenkins says 10x Banking is “on track” to hit its goal of upping its client roster to between 15 and 20 by 2025.
“It’s a dynamic industry,” says Jenkins, over Teams, dressed casually for the interview.
“We are on track to deliver. It’s a long sales cycle selling enterprise software to banks but we have got a strong pipeline and we have got a number of deals we will be closing in the first half of this year and then into next.”
He says the startup is working on future sales opportunities around the world.
Inking in £35 million funding round
10x Banking's £35 million funding round, announced earlier this year, was led by existing investors BlackRock and JP Morgan, marking its first funding round since 2021, when 10x Banking was valued at around £600 million.
The market has been beset by a recent spasm of downrounds, and was this also a downround? “We are not disclosing anything to do with the valuation,” Jenkins says.
“It’s definitely been more difficult to raise money in this environment than it was two or three years ago,” he adds.
10x Banking's backers also include the Canada Pension Plan, Nationwide and WestPac, but it has just one UK investor on its cap table, a fact which doesn't faze Jenkins, who has invested £1 million of his own cash into 10x Banking.
“I regard our business as a global business and therefore it is not surprising at all to me that we would have a global investor base,” he says.
“I don’t necessarily think it’s a poor reflection on the UK, I think it’s simply the nature of our business and the nature of capital we can attract.”
Losses widen in 2022
Along with the funding round, new financial figures have been published for 10x Technology Holding, 10x Banking's parent group, albeit for the year ending 2022.
Losses widened 22 per cent to £60 million while revenues were down 59 per cent to £22 million.
The highest-paid director- presumably Jenkins- was paid £500,000, up from £386,000 the year previous (he was paid £1.1 million in his last year as Barclays CEO).
Rising losses, says Jenkins, can be attributed to the sheer heavy expense of continually building 10x Banking's “complex” tech.
But he says the financial outlay is waning and 10x Banking will be “cashflow positive” in 2025, but not necessarily profitable for all 2025.
"The losses for this year will be much lower than they have been historically, and the reason for that is we have finished the heavy lifting of building the platform,” he adds.
On the flipside, one casualty of the near completion of its tech build is staff redundancies, with between 50 and 100 let go last year, says Jenkins.
However, Jenkins, in full spin mode, says these cuts were not out of the blue, but planned as 10x Banking's banking tech matured, requiring less human investment.
Staff headcount at the end of 2022 was 401.
10x all the rage
Jenkins argues that 10x Banking's tech is all the rage because big banks are turning their back on migrating cumbersome, long-winded expensive technology, preferring 10x’s bite-sized, speedier, cheaper offering.
In a nutshell, 10x Banking, which is based in Sainsbury’s headquarters in London’s Holborn, charges clients a one-off fee to build the tech, then charges the client a fee per customer account. It also offers a licensing service, in addition.
Where 10x Banking wins financially is the tech it sells is uniform, not tailored for individual clients, keeping costs down.
This year, it is also going live with a card initiative, a collaboration with Paymentology, the card processor, called SuperCore Cards, which 10x Banking says will speed up the time it takes for banks to launch credit card products.
New customers and leads at 10x Banking come via relationships with consultancies, unsolicited incoming, as well as via its star salesman, Jenkins himself, who spent 17 years at Citi before returning for his second stint at Barclays in 2006.
He says: “The one thing that I can bring to the table is, given my past experience in the industry, when I sit down with a CEO or COO of a medium or large bank, I understand all the issues and problems they are confronting and I can then show them why what we have built at 10x will help solve there problem.”
Competition in the market
Along with competitors like Thought Machine and Mambu, other competitors are springing up.
Last year, the challenger bank Monese said it was ditching Thought Machine’s core banking platform Vault, replacing it with its homegrown XYB platform, which it sells to third parties.
Is Jenkins worried about all the competition?
“It is a dynamic marketplace, but it is also a vast market. There is room for many different players.
“At the lower end of the market, the fintechs that have built software from themselves will have, I think, some success selling that to others.
“But what they haven’t done like us is build a large scale enterprise-grade platform in the way that we have and I think that is where our sweet spot is.”
Many observers, including Revolut’s Nik Storonsky, say banking is now a tech, not a banking, industry.
Jenkins, who has a 40 per cent stake in 10x Banking, says banking is a data business and technology is just a tool to handle data, such as current accounts and mortgages, more effectively.
“It is my belief the future belongs to those organisations, whether incumbents or neobanks, that can handle data more collectively,” he says.
On the future of the neobanks, and whether a big banking behemoth will snap one up, he says unlikely now.
“I think it is unlikely because of the price tag associated with those institutions! What I do think we will see if the big banks constantly renewing their efforts to compete in the marketplace.”
No signs of slowing down
Jenkins shows no sign of slowing down.
He admits he is “fortunate” having two “different” careers and thinks the chronology- banking first, entrepreneur second- probably came in the right order.
One snippet of advice, he imparts, not just for those working in tech, but for the masses, is the importance of being intellectually curious about technology.
“I believe AI has been a phenomenon for 40 years, it’s just getting more sophisticated at an increasing pace. And so you really have to sort out the hype from the reality.”