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Empowering Entrepreneurs and Driving Financial Inclusivity: A Deep Dive with Wave CEO Zahir Khoja
Discover the keys to entrepreneurial empowerment and financial inclusivity with Zahir Khoja, CEO of Wave, as we unravel his visionary approach to transforming opportunities for SMEs. Wave's mission to support small and micro-businesses is not just about simplifying the technical side of things; it's about igniting the passions of entrepreneurs and bolstering economic growth in communities worldwide. This episode promises a stirring exploration of the driving forces behind today's business ventures and how the current economic landscape shapes these entrepreneurial dreams.
Ever wondered how a passion project turns into a profitable business in the digital age? Zahir sheds light on the dramatic shifts in the entrepreneurship mindset, where social media and tech tools have flung open the doors to new possibilities. We'll hear real stories, like that of a family-owned Ethiopian restaurant grappling with the leap into financial technology, probing the challenges and solutions to the generational tech divide. This episode is a must-listen for anyone curious about the evolving landscape of small business and its potential to change lives.
Finally, we navigate the intricacies of financial inclusion and how it is woven into the fabric of Wave's philosophy. Zahir's own journey from a kid in South Africa to CEO in Canada offers heartfelt insights into the transformative effect of accessible financial tools on growing businesses. The episode culminates with a candid reflection on the nuanced role of a successor CEO, balancing profitability with the well-being of customers, and drawing inspiration from influential figures. Join us for a dialogue brimming with passion, purpose, and the power to shape a more inclusive financial future.
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Welcome to the Money Pot. My name is Rachel Morrissey, I'm the executive producer and I am here with my co-host, mickey Tisfaya, who is the content lead for the Europe show, and me deep in suggestions of what to put on stage. How are you doing, mickey?
Micky Tesfaye:I am excellent. Thank you, Rachel. As you said, knee-deep in suggestions, so it's a busy time for us here on the Europe team, but all good.
Rachel Morrissey:Yeah, very busy time, and we are here with our guest, ahir Koja, who is the CEO of Wave. He has a really interesting position because he is their second CEO. He took over from the founder and that's part of what we want to talk to him about today and his journey as he has come up through different parts of the fintech system and what he's learned along the way. So, hi, ahir, how are you doing?
Zahir Khoja:Good Rachel, how are you Nice to be with you again and Mickey, great to be with you as well. So nice to be with you again.
Rachel Morrissey:Thank you for coming and, just as a complete transparency with our audience, we actually interviewed Ahir in the podcast booth at the Money 2020 US show and, due to technical difficulties, we had a slight issue with that recording, so we're going to try this again.
Zahir Khoja:It wouldn't be Money 2020 without a technical issue.
Rachel Morrissey:Right, there's got to be a technical difficulty somewhere there's got to be at least one, right? So, ahir, let's talk a little bit about what you are doing now that you've taken over Wave. So, when you think about Wave, what do you think is your primary mission there?
Zahir Khoja:Yeah, thanks, rachel, again for having me, and it's great to be back here again. Wave is a business that is focused on serving small and micro businesses. Today in the US, many almost one in four people go into their own business, and what we want to be able to do is offer individuals, solopreneurs the opportunity to live their dream, to get into and start that business that matters to them, because they have the passion and they have the know-how and they have the courage to do that, and what we don't want are things that sit in the background, like managing your books, managing your accounting, figuring out how you're going to get paid something that's really important for small businesses right To manage how they get paid and their cash flow. We don't want those things to be a burden for them, and so those are the services that we offer to our customers today, and we want to make it simple so that they focus on what they do amazing and we can focus on the back end so that they can do even more amazing in the communities that they serve.
Rachel Morrissey:So I find this very interesting. Only because it's the new year, I've been thinking about this a little bit, about how the American dream, which I just think is like the dream of many, many people, is that, you know, be my own boss Something that I love with my time, make a living at it and be my own boss, that's kind of the ultimate freedom. But what else do you think incentivizes people to kind of start, or what hinders people from diving into these passion projects, or this passion of doing that?
Zahir Khoja:Yeah. So if you look at the backdrop of the world that we've all been part of over the last couple of years and even this year, there's so much uncertainty as we go into the world and what we're finding is a lot more people are really diving in and figuring out what is their passion and can they do that as a side hustle, meaning that when they're finished their day jobs, they start to go into their side hustle, which is truly their passion, and maybe it remains a side hustle. Or what we've also seen is side hustles that have translated into full-time businesses, because they realize that they can bring that passion and that energy and that expertise that they have in a certain field and bring it to life. And so I think what we're seeing right now is is you know, the backdrop of what's happening in the world with respect to higher inflation, higher interest rates, cost of goods going up and also a number of people going? I've got this passion and I want to live a life of purpose as well.
Zahir Khoja:Yeah right and so, while I have a job, that's great, but I want to live this life of purpose where I can do what I've always wanted to do, and that's what we want to do. We want to ensure that we empower that for our customers so that they can live that dream. Our whole goal is to allow small businesses, to empower small businesses. We have opportunity to start, survive and thrive, and if we can do that, we have done our job.
Rachel Morrissey:Yeah, and I love this mission because, like I, I always tell people, you know, people go become bakers to bake, not to bank, you know, I mean our listeners are like I've heard that before, but it's true, it is totally true. So I and I've been reading there's a book that's out everybody's reading about happiness and what it is to be happiness, and one of the three pillars of happiness Is having purpose. So I think that that this is right at the core of what's driving a lot of people, and especially younger Generations, to really think about how they're gonna set themselves up. So wave is making a lot of that possible, which is great.
Zahir Khoja:Absolutely, as, like you know, we talk about internally. Our goal is to export optimism Right and so that our customers can do great things For their communities and when they do great things for their communities, that drives Economic growth in that community, that drives employment in that community and that allows that community to reach its goals and continue to grow. So you think, you may think it's just a hobby, it's a passion. What really ends up is you're driving Economic growth for your, you know, for your respective community that you're in as well.
Micky Tesfaye:That's fascinating here, um, rachel you touched on a point that was kind of interesting, right. I think you were also touching around this younger generation and it's absolutely I'm not as young as I used to be. But you know, I like to think I can kind of get away with trying to call myself A confused Gen Z leaning into millennial. But I guess, like one thing that is interesting about this conversation, right, is there is a terminology change. But solo partners in the UK you had these like limited, not limited partnerships, but like so, entrepreneurs, right, you had people who established painter, decorators, plumbers Really small businesses are the lifeblood of developed economies and they've been like that for hundreds of years. I guess.
Micky Tesfaye:Is there a kind of mindset shift now that your noticings are here? I guess, with, say, even the piece that Rachel touched on, folks go into Baking to bake, not to bank, right? Do folks really start to like, lean into that and now Start to really identify Actually what they want to do is focus on the piece they want to do and they're happy to go out and Precure these services and understand actually you have to pay for these and use these to better themselves. I think what you're seeing, mickey, is.
Zahir Khoja:You know, my generation was you picked a career and you went after it and that's what you did. There were no let's work on the weekend, let's work after hours, let's, you know, figure out what your passion is and I shouldn't say there weren't, but it was less. Technology today is allowing you to express yourself in a way that Can be seen across various different channels. So you may have a job that we have, you may have a job that let's call it you like, and it pays the bills, and that's great.
Zahir Khoja:But you have a passion. You want to be that baker, or you want to be a plumber, or you want to be a part of the creator economy, and you don't have you didn't have that avenue before. Now you have the avenue and you also have the social channels that are available to you, and so you can self promote, which once upon a time, you needed, you know, an agency to help you do. You can self promote now and people will see your passion. They feel it. They're not looking at it and going, oh you're, you're baking a loaf of bread. They're buying the energy that comes across your entire youtube video and your ticked off platform, in everything that comes with it and goes. I need to have that and I want to be a part of that and so that I think, is also spurring a lot and is helping as a A an organic tailwind into, you know, the solopreneur and Um small businesses really jumping into doing what they, what they do best.
Micky Tesfaye:No, yeah, that makes a lot of sense. Rachel started this with with a heavy spirit of transparency, so I'm going to lean into that heavily. Um, is it? My parents are business owners, mom and dad style. They own an Ethiopian restaurant. I called my dad a couple of days ago and he's like yeah, so you know it's tax season. I'm out here compiling all of these documents, for you know I'm like dad. You know I work in fintech. You
Micky Tesfaye:There are tools and applications and there are companies that do this and he's like. So I guess that inertia what happens? Because I feel like there is a demographic divide. Right, there's a lot of young people, creators, who are super attuned to the value they create and also the benefit of actually outsourcing other bits where they're not as good as value creation, say leveraging ways, a way, sorry, to improve their payment processes or accounting, right? How do you kind of overcome that gap with my mom and dad?
Zahir Khoja:Yeah, it's a great question, Mickey, and when we think about businesses like your father's he did not wake up in the morning going. I am so excited to do my books today. I am so excited to pay the IRS when I owe them. I'm so excited to pay my Verizon bill today. Like he did not do any of that. What he probably did is go.
Zahir Khoja:I really wanna bring the latest Ethiopian dish that I've created and ensure that my customers are delighted by it. Right? And so one of the things that we focus on I talk about it internally at Wave is customer obsession, but it's really around. How do we understand what our customers want to do so that we can enable simplicity of using our services for them, that it's easy as just a click and it just works? And so if our products and services are easy to find, are easy to buy and are easy to use, your father and my father and all the people that are in that generation, and even the younger generation they don't wanna be bothered with multiple things that they need to do to have back-end what I will call back-end administrivia work for them.
Zahir Khoja:They just wanna know that if I'm a content creator and that's what I do well and I do it best, all this other stuff when I press a couple of buttons with Wave, it just works, and that's what we aim for, is we aim to make it as simple as possible. We're not gonna have the deepest suite of products, because our customer doesn't need that and it complicates things for them, but we will have the products and services that they need, because they've told us that they need it, and we will deliver it to them in a way that is simple to buy and simple to use.
Rachel Morrissey:It's interesting because we are talking about a lot of people trying to adapt to things and having to deal with skills that had nothing to do with their passion, necessarily, but you are dealing with something that was part of your passion and so, and like I, said earlier.
Rachel Morrissey:You are taking over from a founder which is a little bit different than" hey, I founded this. I'm gonna see this to the end, and a lot of times we've looked and we've seen CEOs that are particularly good at founding, but they're not necessarily the right leader for the next stages of a company, and so I'm curious about your own journey and just why you decided to step in at Wave. So tell us a little bit about Zaheer's journey.
Zahir Khoja:Yeah, so I'm a South African born, canadian raised, and I've lived all over the world, anywhere from starting a business in Afghanistan that served the unbanked through a product called M-Pesa to working out of Singapore, dubai, new York with MasterCard, bringing solutions to channel partners for the underserved markets. And so it's always been a passion of mine to serve underserved, because I saw my father as a solo entrepreneur and the struggles that he went through. I was also an entrepreneur and I didn't realize this. Like Steve Jobs always says, you connect the dots when you look back. And I connected the dots and I went geez, I didn't realize all that stuff that I was doing was gonna lead me here. But I tell you that cause, at the age of 15, I started my own cleaning business in Vancouver. Cause I needed to raise money.
Zahir Khoja:Back then, wave didn't exist or any of the digital platforms digital didn't even exist at that point. So you were writing paper invoices with carbon copy and everything right, but I was an entrepreneur. What wasn't exciting was knocking on the door saying, hey, you haven't paid me yet, you haven't paid me yet. And as a small business, it was my summer business. And as a small business at 15, you need your money. You know you wanna go to the store and buy the clothes or go out with your friends or do what you have to. So, fast forward, take a date. Those problems haven't changed, sorry, the problems haven't gone away. They've just changed in nature as I've gotten older, right, and so I've seen this, I've seen it and I talk about this a lot, which is I'm very passionate about inclusion. Being a minority that came from South Africa into Canada, I saw and I felt what it was like to both be discluded and then included. So you talk about it at a personal level. People want that inclusion. We talk about financial inclusion like it's a miracle and everybody's going to click their fingers and it works. But why is financial inclusion important to a solo printer? Why is financial inclusion important to somebody like my father, who was an immigrant into Canada and came with nothing? Because by being financially included, it allows him to have one identity, so now he is recognized in a formal system. It allows him to then grow a business. It allows him to then borrow and leverage off of documented financial transactions, and so it allows you to actually grow your business.
Zahir Khoja:Financial inclusion isn't just about converting cash into a digital platform. It really is about enabling and allowing entrepreneurs to use that data which belongs to them to help them further their business. And then there's digital inclusion. Digital inclusion is an on ramp into financial inclusion, because it's just a tool that allows you now to digitize all of that information.
Zahir Khoja:If you're only accepting cash and you're only accepting check, and you happen to be a landscaper and you now need to buy more equipment, it might be hard for you to get a loan if you're not recording that in the right way. But if you're digitally accepting payment and all of that sits on, let's say, a wave accounting platform, you don't have to do much. You go to a lender and you say here's my books and you can see every transaction that's come in and every payable that's gone out. I need to borrow some money because I want to grow my business, and they'll make the right decision for you. So inclusion is very, very important to me and it's near and dear to my heart because I've lived it. I've seen it in multiple countries. I've been fortunate and privileged to have the opportunity to lend solutions that can solve some of these problems, and when I looked at the opportunity at Wave and who Wave serves, it was a natural fit for my passion.
Micky Tesfaye:So we talk about small businesses having passion, I mean that's such a powerful point you've made there as a hit, because I think often the language of financial inclusion is couched in such personal terms and, as you've demonstrated, that makes sense. But I mean your story and the fact that we're talking to you right now is also just a testament to the power of financial inclusion for an economy right, and how much that contributes to society. I guess my question, I have a question around your story, around being a founder, being a CEO and leading a company after the founder, what is the benefit of joining the company as a CEO and not a founder and what do you think the drawback or the challenge is? So, if you were a founder, what would have been easier in your role and now that you're not the founder, what is a bit easier to get done? I guess.
Zahir Khoja:Yeah, it's a good question. I'll tell you what. The first thing that comes to mind, miky, when I think about it the challenges of being a founder is raising capital right, and so what I didn't have to do is do all the raising that the founder did to build the business and get us to the place that we are today. What I am doing is now taking a very good platform and a great mission and saying how do we now double down on this and offer solutions to our customers that not only enable them to run their business, but there's value exchange, and so we, in turn, can drive revenue for our business that we can reinvest back into our customer? And so, when I took the role, the first thing I thought was what do I need to cherish and not change at all? And one of the things that I need to change and I think, if you really start to look at that and you go, there are certain things that we absolutely need to cherish, and that's providing simple, all-in-one financial management solutions for our customers. But there are things that we need to change, because our customers' needs are evolving and our growth as an organization to service those needs is dependent on us driving revenue.
Zahir Khoja:As I mentioned, as a founder, you have to go out and raise money.
Zahir Khoja:When you take over an existing business, you just have to make more money and then you can bring it in and you can do more to service your customers.
Zahir Khoja:And so you know I'm really excited to share with you guys as well that on the 29th of January, we are launching our very first Pro Tier service, and our Pro Tier service is going to be a subscription based service that gives our customers the ability to have enhanced products and solutions. That is different than our starter service, which is still going to have the free services that they're used to getting today. And so when I go back to start survive, thrive and you've got a dream that you want to start your business, I don't want to be the barrier, and nor should financial cost be a barrier, so we still offer that to our customers today, but as your needs change and your needs evolve and you need more, we will have more for you. There will be value exchange so that we can take that revenue and we can reinvest it back into our business and we can do even more for our customers as they eventually evolve into thrive. That is incredibly exciting.
Rachel Morrissey:One of the things that I think is so interesting this last year we've really with, with the tightening of VC funds and the tightening of funds across the board and the raises being a little tougher, business models and changing focus so that you, your business plan is actually bearing out and you're not being dependent upon in raises of capital anymore, has been a huge focus of the industry.
Rachel Morrissey:You've seen it shift and a lot of them are like you they've done it or they've. You know they've started that journey. What, what advice do you have? Was you're looking at things as how do you, how do you look at this so that you know, when you're transitioning and you're trying to take people from one level where they started and they're doing okay, and then they notice they're hitting a few walls with services that they'd like to enhance, how do you take them to the next level?
Zahir Khoja:Yeah, it's so that what I'll talk about from a couple places the first one, like, from our customers we continually are talking to our customers to understand what it is that they want. Now, a lot of times, customers, the way they express what they want and then when you show them what you have is there's a gap. So it's really translating. I talk about being easy to buy and easy to use. It really has to be easy to understand our customers. We spent a lot of time working with our customers to understand those needs and then, internally, what we do with the team is because we're a customer obsessed organization and we are focused on enabling our small merchants to grow their businesses. Internally, what we do is understand how does that fit into our product development roadmap? Right, and that's how we continue to evolve the business.
Zahir Khoja:From a people perspective, the one thing I would say is much like a founder to a CEO who's taking over from a founder, there are different skill sets and experiences and different passions that people will have across the company's tenure. Some people are really excited about jumping in and being part of the startup. As I say, you know you are the chief cook and bottle washer when you're in a startup. Right, you're opening the door, you're doing the interviews and you're taking the trash out on the way home, like that's what you do when you're in startup.
Zahir Khoja:As the business continues to evolve, the skills and the experience start to find their own swim lanes and the team starts to evolve to that, and some people will really want that and go this is great and how do we do it? And other people will say I need to go find the next startup. And I think it's very important that we celebrate those that helped us to make the business to where it is today and we also celebrate the new people that are coming in to join the business. You know, I was privileged to have worked at Mastercard under the CEO of Ajay Banga, who's now the president of the World Bank, and one of the things he taught me, which stays with me and holds so true to where we are in the journey of our business today, is it's okay to do well and to do good. We don't need to be, we shouldn't be, apologetic about driving profitability, because that's the fuel that enables us to do more for our customers as their needs continue to grow and evolve in their businesses.
Micky Tesfaye:And that's. I think that's a wonderful and powerful way to look at it. I know we've talked through a lot, zaheer, but if you would let me, I have one more question, which is Absolutely I know you've been in your role as CEO for a while. I guess my question to you is what do you wish you knew when you took over that you know now.
Zahir Khoja:Ha, ha, ha ha. Well, if a crystal ball was in front of me, mickey, no understanding what the environment from a macro economic perspective was going to be, to understand how we were gonna maneuver our business and the different pivots that we made and needed to make, and timing, I think we were really good at looking at the information at hand and I think we made the right decisions to move the business forward. In fact, I can tell you we have, because we're seeing that now it's playing out, it's really evolving and our customers are the ones that are ultimately voting by using our services. But what I can tell you, what I don't know, is I have no idea what 2024 is gonna bring Outside of. I'm very sure it's gonna have a bunch of uncertainty.
Zahir Khoja:I do hope the uncertainty is a tailwind, not only for Wave but for our customers, because small businesses, out of all types of businesses today in the world, when something happens, they feel it the most Because it's their livelihood, it's their community's livelihood, and they don't necessarily have access to the same resources that a medium or an enterprise level business would have to get through those tough times. And so really, what we wanna be able to do is give them enough so that they focus on doing what they can do to grow their business, what's in their control, and take the pieces that are out of their control and manage it as best we can for them so that they can manage through the uncertainty and the storm as well.
Rachel Morrissey:Yeah, we don't know much about the predictions thing either, as money 2020 always says, like who the F really knows?
Zahir Khoja:Right, right. So I tell you when I will know about 2024 is in December, Exactly exactly.
Rachel Morrissey:We'll be excellent at 2024 predictions in December. Exactly so thank you so much to hear. Hey, Mickey, why don't you go ahead and read us out?
Micky Tesfaye:Thank you. That's it for this episode of the Money Pot. We want to thank Zahir for joining our show today. Thank you, Bill. He can be part of the Money Pot at the Money 2020 Show. Please send us pictures to podcasts at money2020.com and don't forget to follow us wherever you listen to podcasts. Thank you for listening. We love our FinTech nerds. Thank you.
