N5 Decreases Banking Software Complexity as It Grows in the Americas


Julián Colombo recently shared valuable insights in an exclusive interview with Infomoney, highlighting crucial aspects about N5. He addressed the challenges faced by the financial sector in the search for innovation and explained how our company’s unique solutions have the power to easily transform a financial institution.

In this article, we’ll share fascinating details from that interview, revealing how we play a significant role in our clients’ real success. Don’t miss the opportunity to understand how N5 is shaping the financial landscape.

Company replaces and integrates systems to make the operational activities of financial institutions simpler

A financial institution may have tens of thousands of pieces of software running at the same time. Cards, insurance, mortgages, and investments, for example, often store data and have different service lines, which decreases the efficiency of services and the productivity of teams.

Activities such as customer service through channels or product sales become more complex, since for each action, there is a different system. The headache only increases with all the mergers and acquisitions that a bank goes through over the years, as each institution that joins brings with it more software and more data.

Founded with the idea of centralizing this intricate network, N5 has been expanding its global operations, with a special presence in banks in the Americas. “To give you an idea, and this is not hyperbolic, a bank can have up to 72,000 active software to take care of,” says Julian Colombo, CEO and Founder of N5.

The company is already able to reduce these thousands of applications to a leaner system of 31 essential management software in this industry currently available in the company’s portfolio, such as customer relationship management platforms, process management, sales and commission tracking, and omnichannel (service tools in various channels, such as agencies, applications, and teleservice). They do this through replacements and integrations of the old applications, centralizing all information and commands in dedicated interfaces in these 31 new interfaces.

For those familiar with sales and marketing, the solution won’t seem new—and it really isn’t. Companies that have excelled in the creation of corporate management software, such as SalesForce, SAP, or even some products from Microsoft and Oracle, may have similar applications. In addition, many of the banks have their own solutions developed in-house. “A lot of this 72,000 pieces of software were developed by people from the bank itself who left the company a long time ago,” says Colombo.

What has caught the attention of investors, however, is N5’s exclusive dedication to the needs of the financial industry. These needs are not only restricted to the large number of software that a bank can accumulate after mergers and acquisitions, but also services peculiar to the market, such as credit risk processes. In general, competitors have applications that can be applied to various industries and, although they usually have teams dedicated to each of them, they reach a limit of customization, says Colombo, from N5.

With revenues of US$ 21 million (RS 104.35 million) in 2023, N5 went through an investment round (of undisclosed amount) led by Illuminate Financial, a venture capital fund whose partners are JP Morgan, Citi, Barclays and BNY Mellon.

Described by the founder as a conservative, low-spending company, N5 was cautious in its first round, with funds showing an interest equivalent to eight times the amount of funding originally set by the company. In addition to Illuminate Financial, private equity manager Madrone Capital Partners, venture capital firm Overboost and Brazilian partners LTS Investments — holding company of Jorge Paulo Lemann, Marcel Telles and Carlos Alberto Sicupira — and Arpex Capital, owned by Stone’s founders, André Street and Eduardo Pontes, entered the game.

“We didn’t need capital, we’ve always been profitable. What we wanted were partners who could help take the company to the next level. And then at that moment some well-known people came in in Brazil,” says Colombo, CEO of N5. Although it is based in the United States, the company prefers to present itself as a business “of many nationalities”, in the face of the assessment that it attacks a problem shared by banks around the world.

Part of the strategy is precisely to increase penetration in Brazil with strategic investors, with good traffic in the local market. Today, approximately 40% of N5’s revenue comes from the region composed of the United States and Central America, 25% in the Spanish-speaking countries of South America, 20% in Brazil and the rest divided between Europe, Africa and the Middle East.

Brazil’s representation in revenues was once greater, but accelerated growth in smaller markets diluted the country’s share. The company believes that it is easier to grow in these countries by signing contracts with large banks, such as in Paraguay, where they work with 80% of financial institutions. “You go into a country and try to conquer it. It’s an industry where word of mouth is extremely important,” says Colombo. In Brazil, the company’s main clients are Mastercard, Zurich and C6.

But the company is not restricted to the big names in the financial industry. One of the ways the company finds to attract smaller customers is by negotiating with cloud service providers: AWS, from Amazon; Microsoft’s Azure; Google’s Cloud, for example. As they trade on a large scale due to the demand of the largest banks, it is possible to pass on to customers lower conditions similar to those of large institutions.

The regulatory differences of each country, one of the challenges that can affect companies that develop technology for the financial sector, does not affect N5’s business as much, reports Colombo. “We have developed a lot for English regulation, for example, which is very judicious, requires a lot of data processing. Many of our products, when they arrive in another market, don’t even need to be changed.”

The company saw the number of customers increase by 300% in 2023 and, according to reports, took all the contracts it disputed in the year. With the expansion of its team, now able to serve more time zones, the company hopes to reach another continent: Oceania, with product tests in Australia by the end of 2024.

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