Hexa Finance, a recently launched financial services and consultancy business in the IT and telecommunications space, is the brainchild of Ben Davies and Stuart Mason whose backgrounds are in vendor finance having both worked for some of the largest UK-based global lessors and independent financiers, Alejandro Gonzalez caught up with both of them.
Hexa was built during the coronavirus pandemic and was launched in November 2020. The founders say the idea behind the company came about in response to an opening they saw in the market for “a range of smarter lending solutions designed to help businesses access the funding solutions they need and enable vendors and funders to build longer-term strategic relationships”. I meet with Ben Davies (BD) and Stuart Mason (SM).
Q: Tell us about how you first met?
A: (BD) Stuart and I first met in 2013 when we both joined GE Capital as part of their resurgence into technology vendor finance. Prior to that, we both spent time working at independent financiers, which gave us a solid asset finance experience.
Q: Your time at GE was cut short in 2016 when GE Capital left the market, but what did you learn from that experience?
A: (SM) Yes, when GE Capital’s exit happened in 2016, Ben and I along with many others were unfortunately made redundant. That was a difficult time, not only because of the uncertainty but also due to the fantastic team we had and the client relationships we had built. Looking back, it gave us a great opportunity to try something different at Macquarie and I could not fault the way GE managed a difficult situation.
Q: What did you get up to at Macquarie?
A: (BD) Along with another colleague of ours, we were fortunate enough to secure new roles at Macquarie helping build a new vendor finance division. Personally, I learnt a great deal there and enjoyed their entrepreneurial culture. Perhaps one of the biggest challenges in recent years is the speed in which compliance and regulation is changing. Banks and lenders must constantly manage these demands, whilst also ensuring they are providing competitive and consistent products and services to their clients.
Q: Responding to change quickly is one of the biggest challenges for firms of any size, would you agree?
A: (BD) I am sure Stuart will have a view on this as well from his more recent time at BNP Paribas, but we are living in a world now where speed is so important. In our personal and business lives, everything is on demand and decisions and processes need to be quick and easy to follow. When you add in the complexities of compliance and regulation this is not always easy to achieve. We have identified some exciting technology solutions for Hexa which we hope will enable us to adapt to market conditions and meet these challenges head on.
A: (SM) My views are like Ben’s on this having worked for lenders that process significant volumes of transactions. Customers expect a reliable service, but it is not always easy to achieve when appetite changes quickly. It is important that we use that relevant industry experience to help support our clients and share that knowledge with them.
Q: Where do you see yourselves fitting into the market with Hexa?
A: (SM) Ben and I have known each other for over six years (which was one of the reasons behind the name Hexa, as well as the six young children we have between us). Hexa is the culmination of our experience working together with technology clients at different organisations. We see ourselves as very much a service business and whether our clients are suppliers of equipment, lenders or businesses looking for their own finance we feel we have something unique to offer. We have already started building some outsourced services which have had some great early success. The customer can pay for what they use which is vitally important and comparable with other areas of their business such as HR and Technology.
Q: How did you decide on the right time to start Hexa?
A: (SM) I think deep down we have both always wanted to own our own business, but up until now the timing has not been right for many different reasons. We have been very fortunate to work at some great organisations and have learnt a great deal along the way and that variety of experience has given us the confidence to take the leap. With uncertainty happening all around us we felt that it was time for us to control our own destiny a bit and share our skills and experiences with our customers at a time when they need it most.
Q: What prompted you to start your business during Covid?
A: (BD) That is probably the most common thing I have been asked as a new business owner. Firstly, it has been great spending more time at home with the family which I am looking forward to continuing, but there is no doubt we are certainly in strange times right now. Due to the significant impact of Covid, we almost forget that the UK was going through some serious economic uncertainty prior to the pandemic which unsurprisingly gets overshadowed. It is not always the most obvious decision to build a business during such an uncertain time, but I genuinely believe there has never been a more important time to support UK businesses. Challenging economic periods can often force people to create new businesses and come up with new ideas and I see this period as no different.
Q: What have been your biggest challenges in getting a business up and running?
A: (BD) I left Macquarie back in August 2020 so, on the one hand, I have had quite a bit of time to get things ready for our November launch but on the other hand, it hasn’t felt like nearly enough time. Being honest, I don’t think you can ever be 100% ready to launch a business but you can make sure you are prepared for most things and then it’s a case of being confident enough to start and be ready to adapt quickly if things don’t work so well.
One of the obvious challenges has been thinking about what operational processes and technology we need in place right now versus what we think we might need in the future. Another challenge has been getting to understand what information lenders require to enable them to underwrite certain transactions. Underwriting criteria has certainly changed over the past six to nine months, so it is important that we educate our customers on what is needed and find ways to make it easier for customers to provide additional information.
Q: Asset finance is traditionally about forming relationships, how have you adapted to the new ways of working?
A: (SM) I think we are fortunate to have the technology available to continue conversations with customers and suppliers in difficult times and we are delighted with the relationships we have built so far. One of our core values is “always communicate” so as long as we are talking to customers and suppliers regularly and being open and transparent about changing market conditions we believe we will still be able to build long and mutually beneficial relationships.
Q: How do you see fintech evolving over the next six to 12 months?
A: (SM) Our customers in the IT and telecommunications market are starting to see business levels grow, which is extremely encouraging. I suppose it is a combination of the need for additional technology in the remote working environment but also customers not wanting to put off their investments any longer. There is no doubt there have been advancements in the way technology is used to access financial services products and we can only envisage that continuing with this new way of working. Digitalisation is one of the key themes talked about within the asset finance industry and I think there will be plenty of new technologies coming to the market over the next six to 12 months.
Whilst there has been a big focus in recent times on using technology for credit decisions, Hexa is especially interested in how technology can help connect funders, vendors and end-user customers and improve the communication channels between all parties.
Q: What are your priorities with Hexa going into 2021?
A: (BD) At the moment, our focus must be on providing a good service to the clients that we have already secured. We have some exciting plans to share with the market in the new year but the great thing about being a new start business in this market is we have the ability to change our offering quickly to make Hexa fit with our customers. We are certainly excited about next year, but in the meantime, we wish everybody a safe and enjoyable Christmas break and a successful 2021.
Hexa Finance is a UK financial services and consultancy for the IT and telecoms sectors
Pictured from left: Stuart Mason and Ben Davies