The stronger lesson is about governance design. ConnectOne’s approach suggests that effective vendor selection depends on clear cross-functional decision rights spanning business sponsors, compliance, fraud, security, procurement, and risk. That matters beyond banking: when review criteria are fragmented or informal, organizations either stall good ideas or let them in without understanding blast radius, criticality, and accountability. Leaders should ask whether their intake process distinguishes between experimentation, limited production use, and mission-critical adoption.
There is also a portfolio implication. Early-stage vendors may offer influence over product direction, but that advantage comes with viability, control, and resilience concerns. CIOs should treat startup partnerships as managed options in the portfolio: useful for learning and differentiation, but gated by tiered risk controls, exit plans, and explicit benefit hypotheses. Not every innovation needs enterprise-wide rollout on day one.
Practical next questions:
- Do we classify vendors by operational criticality and data sensitivity before solution selection?
- Can we pilot emerging technology in a contained way without bypassing core control functions?
- Are funding, ownership, and success metrics defined for both the experiment and any later scale-up?
Startups pitching technology to banks should prepare for two realities: a more complex sales cycle than they might expect, and a compliance process that can’t be rushed.
That’s especially true at community and regional banks, which often lack the financial and personnel resources of larger institutions — even as they work to modernize legacy technology.
“Selling into a bank can be complex for some, specifically early-stage companies,” said Siya Vansia, chief brand and innovation officer at ConnectOne Bank, a commercial bank headquartered in Englewood Cliffs, NJ. It has approximately $14 billion in assets, serving small to middle-market businesses. “[Innovators] are focused on deploying that one solution and selling a bank that one solution, which is great … but we have to worry about the whole bank and the whole ecosystem.”
This is the latest installment of Outside In, InformationWeek’s series that explores how enterprises scout, cultivate and scale innovation from external technology partners and startups.
Understand the bank’s challenges
Small fintech innovators should take the time to fully understand what banks must consider when vetting new technology, Vansia cautioned.
In particular, innovators must consider the potential downstream impact of technology they offer, she said. Assessing that can be time-intensive and require change management and additional planning. “We have to think all of that through because we don’t want to solve one problem in one place, only to create an unintended consequence or a problem elsewhere,” she said.
One example of ConnectOne exploring outside innovation while maintaining its guardrails is its recent admission into the Cari Network, Vansia said, which is building a blockchain-based platform for programmable money movement among member chartered banks. She said this endeavor is still in the exploration phase for ConnectOne, but it has some experience in this space. “We had been part of a blockchain consortium previously. So, we met the [Cari Network] team, we tried to understand what they’re doing. We were able to get involved without fully taking on the product,” Vansia said.
It takes a village for compliance
What the bank looks for are opportunities to enhance the client experience when customers interact with the bank’s platforms, and ways to support business segments within the bank, Vansia said.
While some connections with new tech providers happen organically, Vansia said she sometimes discovers potential vendors through banking and fintech conferences, as well as other avenues. “We have invested in a few fintech funds in the past, and that gives us a little bit of exposure.” She typically meets with vendors, learns about their customer base, what problems they solve, and whether that fits into what could make ConnectOne more efficient.
Vetting potential new technology can require several layers of internal governance and compliance with regulatory policy before action is taken.
Through the vendor and product review process, different departments may have nuanced questions and assessments that must be answered before moving forward, Vansia said. “I’ve built stakeholders across every department that have been a part of many of these projects, and we work extremely collaboratively together,” she said.
The procurement and vetting process includes working with the bank’s compliance and fraud teams, Vansia said. IT security and credit teams are also reviewed for potential risk and liabilities with vendors. “We’re looking at the financial health of these organizations. Do they have SOC 2 [certification] testing? How critical of a vendor would they be?” Vansia said.
The extent to which the bank allows a vendor to become part of its operations, and how much data gets shared with them, depends on how critical the tech resource may be and the vendor passing such checks. Vansia also said there may still be questions to unpack, such as what capabilities does the technology offer, and where would it fit within the ecosystem?
There can be room for mutual flexibility and cooperation when working with startup vendors. “Some new partners are early stage, and sometimes I like that. It provides an opportunity for a company like ours to bring our subject-matter expertise to the table,” she said. That can give ConnectOne influence on the product set being offered versus being dealt a product that is unchangeable and might not work so well for the bank. Vansia said she also takes in feedback from different departments and leaders, and determines priorities, budgets and other constraints as they assess the tech.
An innovation cycle with pitstops
The introduction of new tech offerings may be tempered by necessity and circumstances. A couple of years ago, ConnectOne partnered with digital service platform provider MANTL to replace the bank’s end-to-end onboarding system for deposit accounts, Vansia said. That included systems for opening a business or consumer account, whether online at home, in a branch, or by calling the call center. The bank previously managed such functions through different systems, which meant the new, integrated system offered improved efficiency. “Underneath that, we rolled out some more modern data collection tools, so you can open the account, you can submit a lot less paperwork,” she said.
External factors also shaped the bank’s tech road map. For example, ConnectOne explored ways to update its online offerings during the COVID-19 pandemic. “You really understand what you can and can’t do digitally when you have to take everybody out of a physical location and still do those things,” Vansia said. “Some things you take for granted.”
After the pandemic, ConnectOne identified its need for new, modern onboarding software. “Some of the processes we were running — they were inefficient, and we wanted to make the employee experience better,” she said. That led to looking at a half-dozen vendors, taking deep dives into their offerings before deciding on any partnerships. “We want to embed more fraud solutions. We want to make the client experience better and expand our product set online,” Vansia said.
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