Serial entrepreneurship is a state of mind. It was hard enough to keep established fintechs afloat during the fintech winter; it’s a whole other story to build one from scratch in the current climate.

But some persist. Today we’re looking at Suneera Madhani, who built and grew Stax Payments with her brother Sal Rehmetullah to billion-dollar success and left the company. In 2022. What Stax has brought the payments industry to SMBs It was interesting, unusual, and the reason for its growth: it offered merchants flat-fee subscriptions for business payment processing, rather than charging a percentage of each transaction like many of its competitors.

Madhani and his brother are the children of Pakistani immigrants who settled in Chicago. And this experience of being founders from a minority background played a pretty critical role in their latest venture: It’s worth it AI.

With Worth AI, Madhani and Rehmetullah are bringing to market a small business credit score that doesn’t rely on static data or the whims of a human underwriter. It avoids the potential for human bias and prejudice by automating the underwriting process and making it entirely data-driven.

Credit scoring for businesses isn’t a groundbreaking new thing—Dun & Bradstreet has been doing it for decades. But continuing the trend of taking a tried-and-true process and introducing a critical shift like Stax did with a subscription-based model, Worth AI focuses on “real-time data.”

The Fintech Muse

The idea for Worth AI actually emerged from Stax’s bullpen. When working with merchants and SMBs, Stax had to employ 40 human underwriters, which represented 10% of its team, and it took about 17 days to fully understand a client company’s creditworthiness, Madhani told me.

Additionally, most underwriting decisions were based on static data that wasn’t really updated as the health of the business changed. “That’s why we have risk losses. The whole system was something that was broken. As a consumer, I can go today and buy a car if I want. They’ll know my risk based on my credit score. There’s a standardization on my personal financial health, based on a personal credit score. We don’t have any standardization on the corporate credit side,” he said.

It is this standardization and improved analytics that Worth AI wants to bring to the SMB underwriting space. In serial entrepreneurship, challenges in previous ventures spawn new businesses.

How to build a business model

For her second venture, Madhani was able to apply several of her learnings from Stax. The most notable is how she and her brother launched Worth AI for enterprises before going directly to SMBs.

“In my first business, I was directly consumer-facing (SMB). I was onboarding one customer at a time, and the enterprise side, the one-to-many side, came years later. This time, as much as small businesses are what I’m building for, the way I know I’m going to reach them and solve the ecosystem is through the enterprise first,” he said.

This enterprise-first strategy, in which Worth AI partners with large banks and helps them assess the SMBs they serve, helps it touch more companies than if it went directly to them, he said. That doesn’t mean Worth AI will always be B2B2B. Madhani also expects to eventually launch a direct-to-consumer product that provides SMBs with more transparency into how their business is underwritten, highlighting what factors influence the score and by how much.

Who to collaborate with

Finding partners was much easier for Madhani the second time around, he says. His contacts and relationships from building Stax carried over to Worth AI. And because Worth AI’s value proposition relies heavily on real-time data, finding the right partners for it was key. His guiding principle for the partnership is simple enough, but it suggests the depth of his networking: “We want to partner with the best of the best,” he says.

In this quest for the best, Worth AI has partnered with Equifax, which Madhani says is home to nearly 42 million SMB records. “No business is easy, but I can definitely pick up the phone and call all these partners and get partnerships from companies like Equifax,” he said of how his connections translated into this second initiative.

Madhani and his brother also realized early on that to get a complete picture of an SMB’s financial health, they’ll also need to have access to data within the tools SMBs use to manage their expenses. To that end, Worth AI also has integrations with Quickbooks, Xero, and ADP. “The top three should cover 80% of all small businesses,” he said.

Enter the entrepreneurial zone

Starting a startup is risky, but if Madhani’s example is any indication, it gets easier the more you do it, especially if the fundamentals, like your business model and partnerships, are solid.

“I feel like we’ve accelerated the first seven years of our first startup,” he said.

With Worth AI, the sister team went straight to building the right team for the company and raising capital. “I had more confidence and more self-assurance this time, compared to when you first do something and you’re constantly doubting yourself,” she said.

This increased sense of confidence also fits with the goal that Madhani and Rehmetullah have set out to achieve: to get minorities to work on an issue that affects them the most.

It is this combination of minority and founder that brings to light long-standing problems in the ecosystem and brings them together to solve them.

Sidebar: The problem of lack of access to liquidity for SMEs

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