Let's face it, compliance is boring--but not Lisa Gradow. For her, it's an exciting opportunity to give the industry a much needed AI upgrade. She founded Fides, a software company, to tackle the often monotonous work of financial regulations. Fides’s safe and secure tech spares us humans the drudgery of tracking deadlines, sourcing regulatory data, and creating legal documents. “Nobody gets claps for doing it very well,” says Gradow. “So it's something that can be and should be automated.” She started Fides in 2021 and has raised $7.6 million in funding from investors including Sequoia and General Catalyst. Current clients include Allianz, Haribo, Faber-Castell, and Sequoia. Says Gradow: “For us it’s very important to stay a European company, but with a global footprint.”
Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1
Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:
https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript
Stay Connected
Forbes newsletters: https://newsletters.editorial.forbes.com
Forbes on Facebook: http://fb.com/forbes
Forbes Video on Twitter: http://www.twitter.com/forbes
Forbes Video on Instagram: http://instagram.com/forbes
More From Forbes: http://forbes.com
Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.
Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1
Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:
https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript
Stay Connected
Forbes newsletters: https://newsletters.editorial.forbes.com
Forbes on Facebook: http://fb.com/forbes
Forbes Video on Twitter: http://www.twitter.com/forbes
Forbes Video on Instagram: http://instagram.com/forbes
More From Forbes: http://forbes.com
Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.
Category
🛠️
LifestyleTranscript
00:00Building a company doesn't require having a degree, in my opinion.
00:04It doesn't require to be a specific expert.
00:08You just have to re-engineer it.
00:14Hi, everyone. We are here with Lisa Gradeau, the co-founder of FIDES.
00:18Thank you so much for joining me today.
00:20Thanks for having me.
00:21So I'm really excited to talk about all your building in the financial, compliance,
00:24all those sorts of industries.
00:26Before we get into the nitty-gritty of what you are creating with your company,
00:30I want to know a little bit about you.
00:32Can you give me like a 30-second rundown of who you are and where you came from?
00:36First and foremost, a lawyer turned entrepreneur.
00:39So I've been an entrepreneur since I can think in elementary school.
00:44After high school, during law school, I always had my project.
00:47So this is my DNA, and I love to build things.
00:51I grew up in southern Germany, and therefore I'm also very patriotic about Europe and Germany in particular.
01:02I'm building something great coming out of that country.
01:04Yeah, I love that.
01:06In terms of entrepreneurship, and you said you were interested in this from a young age,
01:11what about it excited you?
01:12Why is building a brand something that you're interested in?
01:15I had that aha moment when I was 17, and I just had this idea, and I just, with common sense, started executing it.
01:25And then someone was like, oh, you're a founder now.
01:27And I had not heard that word before.
01:29I didn't know what a startup is.
01:31And then I looked it up online.
01:32I was like, oh my God, this is a job.
01:34You can just have an idea and execute it, and that's a business, and that's a job.
01:39And nobody explains that to you in school, that this is an option.
01:42They just tell you you can become a doctor or pilot or anything, but they don't tell you that you can become an entrepreneur.
01:48And I think just having an idea and being able to just do it is the greatest thing.
01:55Yeah.
01:55Freedom.
01:55Very exciting to have that freedom, to have the time and the space to build something that you are passionate about.
02:00You are a multi-time founder as well.
02:02I want to talk about FIDES first.
02:04Can you give me the rundown of what you offer today?
02:06We want to disrupt and automate corporate governance as much as possible.
02:12It's something that every company in the world has to do.
02:16It has to do with board meetings, shareholder resolutions, subsidiary management.
02:20So something that doesn't sound exciting at the first glance, but you just have to do it.
02:24And nobody gets claps for doing it very well.
02:27So it's something that can really be and should be automated.
02:31Lawyers are very paper-based in terms of how they have been working for the past 20 years.
02:36Nothing has really changed.
02:38And it's so repetitive and so manual.
02:41So it's also very error-prone and a lot of frustration around it.
02:45So we are here to offer an alternative and to really automate it.
02:50With my legal background, I also like to have it very legally driven.
02:54So there is also guidance in the tool.
02:57So we go deeper in actually automating things on the legal side there.
03:02And you work with finance teams, among other teams, to kind of do this process.
03:08And ultimately, in the end, I'm guessing, make it a lot cheaper, more cost-effective for them to do these processes, more efficient in terms of time.
03:16What are the exact services that you're providing and what are the outcomes?
03:20So our user groups are finance, legal, and then also the C-suite and the board members.
03:26So everyone collaborates on a single source of truth so they can retrieve data, look up documents, information.
03:33And then they can also use our AI to generate reports and to have things faster and actually automate also some workflows through the AI.
03:43And then what we do by actually logging all the decisions from the C-suite and the board members, we protect them.
03:51So the underlying thing after you've saved cost and resources, actually, you're protecting both the individuals in the board, in the C-suite, and the company itself.
04:01Because we have this audit trail for the next 10 years of what has been shared with the board, what not.
04:07And you need that if you are ever being sued.
04:10And usually, someone has to go look for that documents and data, and they are nowhere to be found because they're in someone's email inbox who left the company long ago.
04:20So we're also something like the memory for the most important governance-relevant decisions in a company that can be stored with us.
04:30How did you decide that this was a sector of the industry you wanted to embark on?
04:34Was there like a moment that you realized this was a pain point for people and founders, or what was the inspiration here?
04:40In my previous role, I co-founded User Centrix, which is now close to being a unicorn.
04:46And so myself, I was in the role of, you know, running a board and having to manage here and there corporate processes.
04:55And then I also became an angel investor.
04:56I invested in 15 companies as an angel and became a shareholder there.
05:00So my inbox started to pile up with a lot of PDFs, DocuSign here, Adobe Sign there.
05:06And then two years later, the tax advisor asked me like, oh, what was this resolution with this company?
05:10And I'm like, I don't know.
05:12And I also don't know where to find it.
05:14Yeah.
05:14I started looking and I found some tools around that, like single use case tools for parts of that.
05:23I was like, how can that be?
05:25Like, I cannot be the first one to start with a PDF, sell it in my inbox.
05:30And when I didn't find anything, yeah, I thought then someone has to build it.
05:35And corporate law was my focus in law school.
05:37So I also have a passion really for the corporate law because it's so structured and standardizable.
05:45Yeah.
05:45In the years from founding Fides to today, how has it changed?
05:51What new things have you implemented?
05:52What has that growth looked like?
05:54We started when ChatGPT and Gen AI wasn't there.
05:58So in the beginning, we had built our own models to quickly extract information from the documents.
06:04Now with Gen AI available, of course, it's a totally different thing.
06:09And we're a way for the legal departments and the boardrooms to really confidentially and securely use AI.
06:17Right now, they have no capability to do that.
06:20And especially in the boardroom, you have like 300 page stacks where it really makes sense to use ChatGPT to prepare for a reading,
06:27but you're not allowed to because it's too confidential.
06:29So there, this is something that now we can provide to our customers a secure place for very, very confidential documents and data
06:38where we can promise them nothing will ever go out.
06:41We don't train with that data.
06:43We are just searching through your documents, no hallucinations whatsoever.
06:47And this has become a, yeah, a runner, so to say, because companies are looking for that right now.
06:54Is that the primary reason people will come to FIDES or are there, what are the other use cases that is really bringing customers in?
07:01A lot of our customers have hundreds and thousands of subsidiaries.
07:05So this is one use case where it's really tedious without a tool.
07:10And we combine that entity management with the workflows.
07:15So historically, there has been either or.
07:17So you had to have two tools.
07:18So we unite that.
07:20So it's also a unification of several tools.
07:23We have a task management in there.
07:24So you have a corporate calendar with reminders.
07:26A signature is implemented.
07:28So we just unite several tools within each other.
07:31And then it's also for governance, heavy companies like financial institutions or listed companies.
07:40They really have to have this audit trail for the decisions.
07:43And that can also be an urgency driver for why they're looking for it.
07:48What have been some of the biggest challenges in the kind of combination of finance, technology, compliance, law?
07:55All of those are such dense industries.
07:58How have you come up against any hurdles?
08:00How have you kind of gotten past those?
08:03I think the biggest hurdle is getting lawyers to change their behavior.
08:09So they have just gotten used to the way they did things.
08:13And we have both customers in the U.S. and in Europe.
08:17And what we see with the European ones is that they've been really doing it with pen and paper.
08:22And in the U.S., we also see a lot of companies that have used incumbent tools.
08:26So we have to start telling them, actually, there is a better way.
08:31So it starts with education, with thought leadership.
08:34And we have this community called Circle of Councils where we have monthly events in rotating cities.
08:40And we actually meet with councils personally so we can get the conversation rolling on, hey, there is a better way to do this.
08:48So this is the biggest challenge, actually, to get the word out.
08:51But now we're at a point where in Germany and also in the U.S., we see the word of mouth effect because now we have companies that are using it in the board.
09:02And then all the external board members start using it, too, and then they're telling each other.
09:07So this is the nice viral effect about our tool.
09:11Yeah, definitely.
09:12In terms of working in the U.S. versus Europe, what are some of the biggest differences culturally, business-wise, that you have to think about when you are selling this service to clients in those various regions?
09:23There's such an interesting comparison in where legal sits.
09:28So in Germany and Europe, legal mostly is under the CFO, reports to the CFO, doesn't really have their own budget.
09:37They're seen as a hurdle, not so positively enabling things.
09:43And then in the U.S., the legal departments, there's a CLO, so someone sits at the C-suite and they have much more power, so to say, also in deciding what they want and what they don't want.
09:55And then there's another difference.
09:57Legal operations is a function that every U.S. company has, like at least one person fully responsible just for optimizing processes,
10:06because legal is known to be a bottleneck for a lot of other business purposes.
10:12And so the U.S. is very conscious about we need to enable the business, so we need to make legal quicker.
10:19And in Europe, the general counsel often has to do legal operations at night because he doesn't get a full-time position for just someone optimizing and implementing tools.
10:30There are the big corporates, they have that, but everyone else is really doing it on the side, and then digitization doesn't work.
10:39Who are the majority of your clients today? How big are these enterprises? Who are you working with?
10:44It's corporates, and it can be medium-sized corporates, bigger corporates, family offices, through the range.
10:52It's, for example, Lime as a customer, the scooter company, but then also Sequoia, a big fund that we all know.
10:59Then we have Faber-Castell, so the pencils.
11:02So a lot of different companies, and that's what I love about our tool.
11:07Everyone needs it because everyone has a board, has resolutions, has subsidiaries, and can benefit from automation in that part.
11:15Definitely. Prior to Fides, you, as you mentioned, co-founded User-Centrics.
11:19Can you tell me a little about that experience and then ultimately deciding to move on?
11:25Yeah, so I worked in-house at Scalable Capital and had the joy of implementing the GDPR.
11:32And there I came across the idea that, okay, someone needs to build this cookie banner, and if there's no provider for it, then every company has to build it.
11:41And that seemed not so small.
11:43Right.
11:43So then I was connected with someone else who was building the same thing at the same time.
11:49And without really knowing each other, we just started.
11:52And it was so much fun, so chaotic because of GDPR.
11:56And when it came into effect, everyone was like panicking.
11:59But then also nothing really happened.
12:01So for the first, I would say, one and a half, two years, we were also like similar to this now, actually explaining everyone why it's important.
12:09What's the risk?
12:10And then suddenly there was a verdict by the European higher court.
12:17And then the ball started rolling.
12:19And now, yeah, User-Centrics is close to 100 million in ARR and is doing great.
12:25But it's one product.
12:26It's a cookie banner.
12:28And, yeah, I am very happy now with doing a little bit of a more complex product suite.
12:35But I love the ride.
12:39What from that ride are you now bringing in to Fize?
12:42I'm sure there are so many lessons you learned, things that you did that you might now avoid.
12:47What are some of those things that you're pulling with you today?
12:49I think the biggest learning is that you just have to be yourself and not try to sell someone something you're not.
12:58Both from a tool perspective, but also you personally towards investors, towards employees, towards customers.
13:06So I just have, I feel like, one personality that goes into all directions the same.
13:12So I just want to be very authentic about what's important to me, what I'm passionate about, what I'm good at, what I'm bad at.
13:18And so this is, I think, the most important thing to myself, to stay true to myself.
13:23And then also business-wise, everything is selling always.
13:28So it helps if you're passionate about it.
13:32Because even now, like, talking about it, I get energy from that because I love what I'm doing.
13:38And I think that is important.
13:40As soon as you lose that spark, everyone will sort of feel it.
13:44I'm a big believer in energies and vibes and that your thoughts can also be seen and manifest.
13:51And, yeah, that's something that you just have to be intuitive about.
13:57Yeah, I love that.
13:58In terms of the future, now that you're taking these learnings, being yourself in these meetings,
14:03going forward with FIDES in a way that you feel is, you know, really what you are excited about,
14:07what you're passionate about, what do you see as the future?
14:09Is there anything on the horizon that you're especially excited for?
14:13Our goal is to become the European leader or at least the leader in our region, of course, as fast as possible.
14:21And for us, it's also very important to stay a European company, but with a global footprint.
14:29And I think that's what a lot of companies in Germany miss.
14:32And investors tell you always, like, oh, you need to wait.
14:36Don't scratch yourself between two continents.
14:38And there was one thing in the Sequoia Arc program that the founder of Klarna said, like, in hindsight,
14:44what would he have done differently is go to the U.S. before you go to any European country,
14:50because a new market comes with the same challenges, either it's France or Italy or the U.S.
14:56And then it might as well be the U.S. being the biggest market.
15:00And we have competitors in Germany that are the same providers in the U.S.
15:04So we know our product is already better than theirs.
15:08And that's why we're going to attack them in their home market.
15:11And my schedule, if you look into my calendar, like everything after 6 p.m. is U.S. calls.
15:16Sometimes I give demos at 1 a.m.
15:19Yeah.
15:20And I'm super excited about that, actually.
15:23Do you have any predictions about how AI is going to continue to impact you and what you're building?
15:28So we have a lot of agents that we're currently building that will fully automate what councils are doing today.
15:36So you will just interact with our tool, like it's your personal paralegal or even corporate council.
15:44So we will automate a lot of the tasks over the long time that councils right now have to do manually.
15:50That doesn't mean that they will fall out of the job, but it just means they have more time for high value tasks.
15:58And then also looking into the boardroom, there's something about also giving strategic recommendations to the board members.
16:07That could be exciting because there's so much data and facts to consider in the boardroom where AI can really help you to quickly pull something up to remind you, hey, you've already discussed this two years ago.
16:21So this is something that we will probably be looking into more.
16:25Yeah. For other young founders today, having now built multiple companies, left one, started a new one, success on both of those ends.
16:36What is your biggest piece of advice for others who are hoping to build companies right now?
16:41It's common sense. Building a company doesn't require having a degree, in my opinion.
16:48It doesn't require to be a specific expert. You just have to re-engineer it.
16:55Like there's always a first step. And I think that's where the most people, they don't even get started.
17:01And I respect if someone gets started and then you will figure it out on the way.
17:06Yeah. Well, thank you so much for taking the time to walk me through all this.
17:09I'm so excited to see all that you guys continue to build the slides. Thank you.