How a BaaS Company Grew 5x in the Face of a Fintech Freeze

Growing a business is hard enough, but scaling during a funding freeze in fintech is an even bigger challenge.

This is a story about how a banking-as-a-service (BaaS) provider—initially reaching $1 million in revenue—needed to shift its approach to survive the downturn and grow to $5 million.

If you’re running a fintech or SaaS business, you’ve probably felt the effects of a tough market. And like them, you might wonder: how do you push past the ceiling?

By the end of this article, you’ll have a clear understanding of how they pivoted to a new market, refined their offering, and leveraged the right strategy to fuel sustainable growth.

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The Early Success: Hitting $1 Million

This BaaS provider had a good thing going. They offered fintech startups a white-label platform to integrate banking services like digital accounts, debit cards, and payments into their products without building everything from scratch. After three years, they had hit $1 million in revenue, working primarily with early-stage fintech companies.

However, when the fintech funding freeze hit, things changed quickly.

Startups began to struggle to secure capital, which dried up their customer base and sales pipeline. This created a new challenge: their core market—fintech startups—was no longer reliable.

This is because their growth relied on the rapid expansion of fintech startups, but with funding running low, these companies cut back on product upgrades and new services.

To keep growing, the BaaS company had to find more stable customers who weren’t affected by the funding freeze.

The Challenge: Adapting to Market Changes

The fintech funding freeze hit everyone hard. For the BaaS provider, the immediate problem was clear: fewer fintech startups were looking to buy their services, and the startups that were still operational didn’t have the budgets to invest in banking solutions.

Here’s what they were up against:

1. Dwindling client base: The pipeline of startups slowed as the sector faced tighter investment.

2. Budget cuts: Clients had less money to spend on integrating new technology.

3. Higher financial risks: Startups that were already on the platform could fall behind on payments due to cash flow issues.

So, without adapting, the BaaS provider was at risk of stagnating or even losing revenue.

They needed a new plan—quickly.

The Pivot: Moving Upmarket

It is at this exact stage they partnered with us, and after considerable consultation from the result of our diagnosis, the company decided to move upmarket, meaning they shifted their focus from startups to larger clients like mid-size banks and enterprises.

Unlike startups, these clients weren’t as vulnerable to funding freezes, and they typically had bigger budgets.

But moving upmarket wasn’t as simple as selling the same product to bigger companies.

These larger businesses had different needs—they cared more about security, compliance, and how well the platform could integrate into their existing infrastructure.

This shift required the company to rethink both its product suite and its approach to sales.

This move was simply a matter of survival because bigger clients mean bigger, more predictable contracts.

While it takes longer to close deals with banks and enterprises, these clients have deeper pockets and more stable revenue streams.

For a company looking for long-term growth, this strategy made sense.

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Tailoring the Product for Bigger Clients

As mentioned previously, to win over these larger clients, the company had to adjust its product offering.

Startups typically wanted speed and flexibility, but larger enterprises cared more about things like compliance with financial regulations, reliability, and ease of integration.

For example, one traditional bank they were courting wasn’t interested in the platform at first because of concerns about regulatory compliance.

In response, the BaaS company developed a specific compliance module to address the bank’s legal needs.

This feature helped them land the contract and opened up the door to more conversations with other banks.

It is really important that as you move upmarket as a smaller brand you innovate around your product and be agile. This is because when you’re selling to bigger businesses, you’re often dealing with longer decision-making processes and stricter requirements.

Innovating your product to meet those needs isn’t optional—it’s essential. Without making these adjustments, the BaaS provider wouldn’t have been able to tap into this more lucrative market.

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Repositioning the Brand & Adjusting Go To Market Strategy

Repositioning the brand and adjusting the go-to-market strategy was essential for this BaaS provider to remain competitive and set itself up for sustainable growth.

Their initial success serving fintech startups was commendable, but because market conditions had shifted dramatically, the increased competition, and a fintech funding freeze, the company needed this strategic shift as they risked being stuck in a shrinking, crowded space.

The funding freeze in the fintech world meant fewer new clients and increased pressure on existing customers, which was a significant challenge to overcome. But to win this business, the BaaS provider had to position themselves as a trusted, enterprise-grade service provider.

Large companies, especially traditional banks, demand more than agility—they need robust infrastructure, security, and a strong track record of compliance.

This is where brand repositioning became vital.

We worked with the company to refresh its messaging and align it with the needs of larger clients, highlighting their strengths in security, scalability, and regulatory compliance.

This wasn’t just about changing the language—it was about creating a brand identity that inspired trust among enterprise-level clients.

We also overhauled the go-to-market strategy to suit a more complex sales process.

Selling to startups is quick and nimble, but securing deals with larger organizations requires a thoughtful, methodical approach.

By developing an enterprise sales team and incorporating account-based marketing tactics, we helped the company build stronger, more strategic relationships with key decision-makers in the industry.

In the end, these strategic shifts not only helped the company navigate market challenges but also positioned them for long-term, sustainable growth. The fintech sector had become too unpredictable to rely on, and this move to target bigger clients was key to ensuring stability.

If you're facing similar growth challenges and need to scale your business smartly, take a closer look at our Revenue Scaling System (RSS).

We’ve helped companies like this BaaS provider scale up, reposition, and break into new markets—all while maintaining efficiency. Book a discovery call today to learn how RSS can be the key to unlocking the next level of growth for your business.

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Upgrading Infrastructure: Moving to a More Cost-Effective Cloud Solution

As the company scaled and started serving more established institutions, it faced a new challenge: rising cloud costs.

Their existing cloud setup, while sufficient for smaller clients, wasn’t optimized for the heavier demands of larger enterprise customers.

This spike in usage meant that their operational costs were growing rapidly, which began to cut into their profit margins.

To manage this, we worked with them to move to a more cost-effective cloud infrastructure.

The goal was to lower expenses without sacrificing the quality or reliability expected by their growing customer base.

By optimizing their cloud resources and leveraging providers that offered competitive pricing at scale, they could handle increased demand while keeping their costs under control.

This shift was essential to maintain profitability as they grew.

It ensured that, even as their client base expanded to include larger, more established institutions, their infrastructure remained both robust and cost-efficient.

Moving to a cheaper, more scalable cloud solution allowed them to meet high traffic and performance demands without eroding their profit margins.

Switching to a Subscription-Based Revenue Model

The final piece of the puzzle was switching from a pay-per-transaction model to a subscription-based model.

Initially, clients were billed based on the number of transactions processed through the platform. This worked well when their clients were startups with fluctuating volumes, but for larger clients, this model felt unpredictable and difficult to budget for.

The solution was to offer a tiered subscription model where clients paid a flat rate based on their usage levels.

For example, one mid-size bank signed up for an enterprise subscription, which included premium features like custom support and advanced compliance tools.

Plus, a subscription model provided the BaaS provider with more predictable, recurring revenue, which helped them weather the storm caused by the fintech freeze.

It also made their offering more attractive to larger clients, who preferred knowing exactly what their costs would be every month.

The Outcome: A 4x Revenue Growth with More Stability

Within 18 months of making these changes, the company had grown its revenue from $1 million to $4 million, and they were on track to hit $5 million soon after. By moving upmarket, innovating their product, upgrading their infrastructure, and switching to a subscription-based model, they not only survived the fintech funding freeze—they thrived.

Here are some of the key outcomes:

- Diversified client base: The company moved away from relying solely on fintech startups, reducing their exposure to market risk.

- Higher-value contracts: Working with larger enterprises and banks led to bigger, more stable deals.

- Product improvements: Innovations like the compliance module and cloud-based infrastructure made their platform more attractive to larger clients.

- Predictable revenue: The switch to a subscription model helped smooth out revenue fluctuations, providing more financial stability.

Lessons for Other Businesses

This case study isn’t just about how one company grew—it’s about how any business can adapt and scale in tough market conditions.

If your current market is drying up, consider looking at new, more stable customer segments. Tailor your product to their needs, invest in scalable infrastructure, and create a more predictable revenue stream with subscriptions.

In short, don’t just wait for the market to get better. Adapt, innovate, and find new ways to grow—just like this BaaS provider did.

If you have been undergoing similar challenges, and are interested in learning more about how we can support you, our sales process begins with an Initial Discovery, where we take the time to understand your business, challenges, and goals through a no-obligation consultation.

Following this, we move into a Business Diagnosis, a paid in-depth analysis of your market position, operations, and growth potential, allowing us to pinpoint opportunities for scaling.

Based on these findings, we develop a custom strategy during the Strategy Development & Planning phase, where we create a detailed, paid roadmap tailored to your needs.

Next, we offer Team Training to ensure your team is well-prepared to execute the strategy effectively.

Finally, during Implementation, we work side by side with your team to execute the plan, adjusting where needed and ensuring everything aligns with your growth objectives.

Throughout the process, we stay connected, tracking progress to ensure sustainable, scalable results.

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Conclusion: Strategic Steps for Sustainable Growth

Scaling a Banking-as-a-Service (BaaS) business from $1 million to $5 million doesn’t just happen by chance—it requires intentional, strategic decisions. For our client, the key was moving upmarket to attract larger, more established institutions. But it wasn’t just about getting bigger clients.

They had to reposition their brand, refine their product offerings, and ensure their infrastructure could handle increased demand while keeping costs in check.

By moving to a more efficient cloud setup, they saved on costs without sacrificing performance, ensuring they could meet the high expectations of their new enterprise clients.

The introduction of flexible, modular solutions also allowed them to stand out in a competitive market and offer more tailored services.

These shifts didn’t just drive revenue growth—they laid the foundation for long-term scalability and resilience, even in a challenging market.

If you're looking to make similar moves and scale your business effectively, let’s have a conversation. Our Revenue Scaling System (RSS) is designed to help businesses like yours grow strategically while maintaining profitability. Reach out, and let's discuss how we can help you achieve sustainable growth.

About The Author

Tanya Kabuya is an international speaker and skilled entrepreneur specializing in revenue growth and sustainable business scaling for tech-enabled companies. As the founder and CEO of a firm focused on revenue optimization, she helps businesses achieve profitable growth through effective strategies and high-performing teams.

She is also the Editor-in-Chief of Business Creed Magazine, a LinkedIn Influencer, and founder of the Afripulse MSMEs Network, A peer-to-peer community and an alternative investment club where entrepreneurs of African descent, their allies, and friends converge to ignite innovation and drive growth in the Micro, Small, and Medium Enterprises (MSMEs) as well as in the tech ecosystems in Africa and the diaspora.

Her work promotes economic development in Africa and her commitment to showcasing Africa's rich culture

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