Wonga head of finance Jody Baumgarten on navigating a crisis soon after acquiring a business.
Since he was a boy, Jody Baumgarten has always been good at working with his hands and fixing things, which led him to a career in finance, where he often solves complex problems.
He did his articles with PWC and worked for Dubai World Holdings until an opportunity to join Wonga surfaced in 2011. He was excited, because it was a digital business that was set to disrupt the world of credit provisions. He joined the team at a time when there were just three people: him as the head of finance, the CEO, and a colleague heading up communications and marketing.
He says, “As soon as I joined, I realised that the role was much wider than I had thought it would be. I oversaw the financial aspects of the business, including accounting and bookkeeping, and also served as our company's human resources manager because we had only three employees, but we quickly grew to 250 people. That led to a lot of work creating payroll records for all those new employees, however it was a great opportunity to learn and gain valuable experience. My typical workday started at 8am and would end well after midnight.”
Taking over
“Initially, we were a subsidiary of the UK operation. In 2019, we got the opportunity to buy the business out of the UK group. So that was myself and two of my colleagues, who were the other co-directors.”
After very protracted negotiations with the UK, which went on for nearly a year and a half, they eventually bought the business in December 2019. The team took a break over Christmas and came back in January ready to take the business to the next level. He says, “We had mapped up the strategy for the new business, all of our plans for the next three years and presented them to the board. We signed a new lease for new premises, and about four or five days later, the Covid-19 pandemic started and we went into lockdown. I must say having just bought the new business with all of our own resources, it was extremely challenging and concerning.”
He says the team made some difficult decisions about whether to continue lending at the same rates that they did before the crisis. “We made some difficult calls, and we lost a significant proportion of our business in late March. But over time, as things started to normalise and we got more data on how existing loans were performing, we started to undo some of those decisions and began growing again.”
He says they had to restructure the business and have now managed to get back to the levels that they were doing before Covid-19. ”We achieved that with a lot of battle scars. I am proud to say that we’ve come out the other side because of the dedication of our team members, and are now in a position where we can look ahead with some excitement about our future.”
The power of finance and technology
As a business, they are always looking for ways to improve their technology. Jody asserts that synergy between finance and technology is the result of each industry leveraging its strengths. He says, “The management team sets the strategy, charts the course and communicates where we want the business to go, and what we need the system to do. It’s then handed down to the chief technology officer and his team, who are responsible for finding the best technology, identifying partners, integrations and staff members who complement the team, so that they can make it happen.”
Management oversees a team of developers, product owners and data scientists who mine and analyse data to provide insights on where the business should be moving within their strategy. “This symbiotic relationship would not work unless each member played their part. If there is a gap in any of these roles, then we stand to fail.”
Some of their exciting projects
Jody says, “We acquired the business with a number of existing systems, some dating back to 2011. We’ve always tried to keep up with the latest technology, so one of our major projects was to swap out our marketing and CRM system. This was a massive feat, which we accomplished in four months.”
The next project will be to redesign the legacy system in the cloud and have no more servers located at the office or data centre. Moving the entire platform to the cloud has a significant number of benefits for operations, both financially and operationally.
The company has some small product rollouts coming up later in the year, but because they are busy redeploying and redesigning systems, they have decided it’s not the time to do too many other things. “We move quite quickly, but cautiously. We’ve been very quiet in the marketing space and that’s been quite deliberate, as we will be embarking on a brand refresh.”
Unwinding in nature
When he’s not working, Jody loves to be active. “I really enjoy the outdoors. I’m an avid mountain biker and I’ve done some pretty big mountain bike races in the past, like the Cape Epic, which is an eight-day mountain bike race. I’ve also completed quite a few triathlons and Ironman races.”
The next big task that he has set for himself is to do the swim from Cape Town to Robben Island at the end of the year.
