For companies focused on driving social good through financial products, scaling delivery of these products is key to positively impacting the lives of as many people as possible. At the same time, managing SaaS spend is critical to keeping the cost of services down for any tech-forward organization.
From Latin America to East Africa and Asia, fintech startup Tala is a non-bank lender that extends microloans to those who are unable to access traditional financial institutions. Millions of customers around the world rely on this increased access to capital to start or grow businesses, support their families, and advance their lives and communities in ways they otherwise would not be able to.
CFO at Tala
Delivering on Critical SaaS Negotiations
With a mobile-first infrastructure designed to deliver instant loan decisions and disbursements to anyone with an Android smartphone, SMS technology plays a critical role in delivering on Tala’s mission of building a financial system that works for everyone. When it came time to renew their multi-regional SMS delivery agreement with one of the largest SaaS SMS providers, negotiating terms that supported Tala’s growth became the priority.
SaaS agreements are complex, with information asymmetry that favors the SaaS vendor. The internal stakeholders at Tala who were tasked with managing these contracts had extremely limited time to spend on each agreement and limited information on how each vendor handled licensing and discounts. Knowing this, Tala partnered with Tropic to level the playing field and ensure an optimal outcome, benchmarked against hundreds of negotiations that fit a similar profile to Tala’s.
We manage contracts for high-growth companies around the world
First, Tropic centralized all existing agreement-related data and paperwork and identified Tala’s stakeholder approval process. Tropic then engaged the SMS provider months ahead of their renewal date to start reviewing Tala’s goals and renewal requirements.
After 6 weeks of back-and-forth with the provider, Tropic reached an optimized agreement that saved Tala 29%, all without the toil of lengthy negotiations that had previously consumed valuable bandwidth for internal stakeholders at Tala. At the same time, the SaaS vendor shortened their sales cycle and received a signature ahead of their deadline – a win-win for both parties.
By lowering the cost of servicing, both through time and spend, Tala is able to pass the savings to their customers and increase the scale at which they deliver essential financial products to customers. No longer are high servicing costs the barrier to reaching customers in underserved areas; a huge win for Tala’s mission.
“I spent almost no time on this”
Jennifer Loo, CFO
Driving Ongoing Value
Within the first year of working with Tala, Tropic prevented price increases in all fifteen of Tala’s SaaS renewals, with an average savings of 22.1%. By continuing to leverage Tropic’s expert guidance and with the confidence of knowing they received the best deal for their organization, Tala maintains their focus on what matters most: creating the world’s most accessible consumer credit product.