Company Name: Virtual StrongBox, Inc.
Ron Daly (Founder and President/CEO)
Lenny Giambalvo (Chief Technology and Product Officer)
Twitter: @VirtualStrongBx @RonDalyVSB
— Responses below are by Ron Daly —
Virtual StrongBox addresses one of the biggest innovation challenges in Fintech – the balance of security and convenience. Balancing security and convenience while attempting to digitally transform is tough in any industry. Financial institutions are faced with the challenge of ensuring the security of customers’ information and at the same time providing the ability for customers to do business when, where and how they want. To thrive and survive, financial institutions need to make it easy and hassle-free for the consumer to do business with them.
Virtual StrongBox knows the stakes are high. The security/convenience balance requires a lot of careful planning, design, and a secure platform designed for that balance. Some companies focus solely on data security. Others focus solely on consumer convenience. There’s no need to compromise. We have built the bridge to bring security and convenience together.
Can you explain what that looks like for the end user?
Our platform is a key part of the digital transformation fabric that bridges the gap between legacy systems and the digital consumer’s real-time expectations. Think of the secure platform as a translator that speaks digital consumer and old technology. To the end user this is exactly what they demand – convenience, mobile, easy to use and a simple way to interact and exchange information with the company they are doing business. No more fax, scan, email, mail or bring it to us in any process. Take a picture of your drivers license and it’s instantly delivered to the organization.
To the organization, our secure platform uses our patented technology to collect or exchange sensitive information required in the business process and then uses our API library to deliver it to the old legacy system workflow. The benefit to the organization is that they don’t need to spend tons of money to bring their core systems up to date just to meet digital transformation pressures. In fact, in many instances we are reducing operational costs by 70% to 80% in the efficiencies that are created.
How do you collaborate with existing FinTech applications?
Virtual StrongBox’s secure customer engagement platform and APIs coupled with our deep security, API first strategy and financial industry expertise, empower our FinTech partners and clients to innovate around old, expensive to replace, lagging technology to achieve consumer-driven innovation without sacrificing security or convenience. Our Software-as-a-Service offering is deployed at over 250 financial service providers and our Platform-as-a-Service has been integrated into six FinTech offerings. The digital transformation in these clients include transforming consumer, small business & commercial lending processes, new account opening processes and compliance and mortgage lending compliance in FinTech. In RegTech the platform is transforming compliance, secure file exchange and innovating around regulatory exams and audits.
What is the inspiration for your company?
The Virtual StrongBox journey started when I was trying to solve a personal pain point. As the owner of a growing company, I had piles of personal and business documents and files. Cloud storage didn’t provide the level of security that I needed or protect personal information the way Fintech, RegTech & InsurTech regulations required. Sure, there were non-secure options available at the time but most of my documents were just too important to store in a stranger’s “garage.” In addition, my financial service customers were telling me that they could NEVER use the cloud when it comes to storing and exchanging their customers personal data. These two things inspired us to create our secure, customer engagement platform – Virtual StrongBox.
Who is your competition and how do you distinguish your company?
We knew that the only thing holding highly regulated financial service firms back from leveraging the power of cloud for business process transformation was the lack of a data security focused platform. The Virtual StrongBox platform and it’s six patents make data security our #1 priority.
Our platform, with its Total Information Privacy & Protection (TIPP), protects confidential data in the cloud the “Financial Institution” way. TIPP is the security measure that sets Virtual StrongBox apart from every other provider. It ensures Virtual StrongBox users that only the account owner can see the documents within their personal account. The Virtual StrongBox user is the ONLY one that can access files in the Virtual StrongBox account. NOT employees at Virtual StrongBox. NOT Employees at the provider of the service. NOT employees at the cloud-service provider.
Our Total Information Privacy and Protection patents and infrastructure ensures our clients and users’ that Personally Identifiable Information is never vulnerable to security threats.
When did the company start? How did the team come together?
Virtual StrongBox started as a product in my first start-up but became its own organization a few years ago. We quickly realized the potential of the platform and the tremendous opportunity to bring transformational changes to the financial services sector. The Virtual StrongBox platform became its own company shortly after that realization. In 2016, we had a successful exit on the original company which created the opportunity to drive Virtual StrongBox forward. The company’s CTO and a hand-picked selection of employees followed me to the new organization.
What is your connection to the Carolinas and why do you operate here?
The technology division of my first start-up was located in Charlotte. While traveling from Northern Virginia on a regular basis, my family and I loved all the region had to offer. As the Virtual StrongBox CEO, being part of the growing FinTech and startup Network in Charlotte was key to our success and has provided growth opportunities. A couple of examples – the Blue Diamond Award we received opened doors to conversations with local financial service providers that were looking for technology like ours and being part of the StartCLT and UNCC Ventureprise groups opened the door to a meeting with the Deputy Director of the CFPB and his RegTech innovation group in Washington, D.C. In addition to the great networking opportunities in CLT, as our organization grows, the available talent in the region with all kinds of experience in the financial services industry is a huge benefit.
Recent Accomplishments and Challenges (share with our audience how your company has made recent progress)
Our fastest growing opportunity is using the Virtual StrongBox platform to strategically transform loan participations and sales. We spent the last year and a half working with financial institutions on their loan participation needs and pain points. We’ve found a common problem and we used our technology to solve it. There’s nothing else in the marketplace that does what we have created that provides instant ROI and gives our clients a competitive advantage.
Another large opportunity in 2018 is the launch of a new cybersecurity collaboration portal by one of our strategic partners to help financial institutions prepare for fast-approaching cybersecurity examinations. The portal’s integrated documentation vault, provided by Virtual StrongBox, secures evidentiary documents against exposure while allowing selective sharing between a financial institution and external users such as outside Auditing or Consulting partners or NCUA/FDIC examiners.
What challenges have you overcome since starting Virtual StrongBox?
One of the biggest challenges is to get any organization to narrow their focus and create steps in their digital transformation strategy. Tackling digital transformation all at once is like trying to boil the ocean. It just can’t be done.
Another challenge that Virtual StrongBox and every other FinTech company had (or has to) overcome is the how the corporate immune system of any organization is trying to protect the status quo to preserve and protect the past. Too often executives worry about the time it takes to integrate new systems or processes, the costs involved, and the challenges of employee buy-in. A fear of failure and corporate hurdles often inoculate organizations against fresh ideas.
To address both of these Virtual StrongBox has established an innovation sandbox where our technology and focus help our clients win at digital transformation. Clients can solve one digital transformation problem at time & not try to “boil the ocean” with rapid prototyping with one business line or functional area. They can incubate ideas that dramatically increase the business value for clients and look for better ways to work differently with the consumer. Best of all it’s low risk and inexpensive learning to move forward or fail fast.
What is Next?… (for you, the industry, the next 5 years?)
I think there is a tremendous opportunity for Virtual StrongBox and other FinTech providers going forward. Over 1.3 million security-conscious enterprises globally know they need to transform legacy technology & workflows without spending tens of millions of dollars & taking years to deploy. Yet they are stymied to the point of paralysis by security concerns and regulations that make forward progress very slow. In addition, Enterprises that are searching for operating efficiencies while new entrants & competitors are achieving cost transformation and new business models.
Consumers are going to continue to drive digital transformation forward with their “need it now” mindset placing the burden on organizations to find new ways to compete/interact with them. Organizations are also under pressure to find ways to reduce or eliminate operational expenses. Because of these factors we should continue to see growth in SaaS and PaaS companies that provide services to help them achieve their goals.
The Virtual StrongBox platform is a key part of the digital transformation fabric that bridges the gap between legacy systems and the digital consumer’s real-time expectations. We believe that our company is perfectly situated to take advantage of this continued trend.
Do you think you will expand outside of financial services to other industries that deal with secure information?
Great question – there certainly is a great need to secure and protect critical information across many verticals and organizations. What’s more, the new GDPR data protection and privacy regulations raises the bar, and the fines, for everyone. Virtual StrongBox’s secure customer engagement platform is already working with organizations and partners in the FinTech, RegTech and InsurTech sectors that are changing the way confidential information is collected, protected and exchanged in various workflow processes. Our strategy for other verticals like healthcare, government and human capital management is to be the integrated technology of another entrepreneur’s vision and transformation strategy for those verticals.
How have your two startup experiences differed/been similar?
I was founder& CEO of my first company from 2000 to 2016. If you think back to that period technology, its cost and how it was used was completely different than now. The speed of change in technology and the consumer expectations was not as great as it is now. This time around technology is almost disposable because of the models in place now and how fast a FinTech can design a prototype or product. New competitors can come out of nowhere to challenge anyone’s business model.
I really like the fact that major banks and companies are setting up innovation labs and venture groups to explore new Fintech companies and offering outside the corporate structure. It certainly makes it easier to find the right people to pitch your technology to than ever before.
Any advice to other Fintechs and entrepreneurs?
First, be persistent, patient and very fluid in your strategy (i.e. sticking to the original plan no matter what is not always a good strategy).
Second, don’t be a solution looking to create the problem. Listen to the marketplace and your customers for the pain they are trying to eliminate, see if your technology can solve it and then find out how much they are willing to pay for a solution. One small pivot in your tech or product offering can go a long way in making your company successful.
Finally, fail fast and move on.