Global expansion – Josh Foreman, InDebted.

Dexter Cousins recently caught up with Josh Foreman, CEO of InDebted to discuss their global expansion and recent Series C capital raise.

Josh first appeared on the show in 2020 and he shares the lessons he has learned from writing InDebted’s first line of code to launching in 7 countries!

In this catch up we discuss the evolution of the debt collection industry, the challenges of consumer fintech, and how InDebted are building the infrastructure for Credit.

We also talk about the impacts of AI on their operations, and the strategic decisions that have led to their expansion into multiple markets.

Foreman also shares insights on the future of credit infrastructure and the lessons learned throughout his entrepreneurial journey.

Highlight

My favourite insight from the chat with Josh is the critical role of intuition in entrepreneurship. Listen in from the 35 minute mark for some great insights by Josh.

Chapters

00:00 Introduction to InDebted and Its Mission

03:04 The Evolution of Technology in Debt Collection

09:08 Disrupting Traditional Debt Collection Models

15:00 The Future of Credit Infrastructure

18:03 Lessons Learned and Strategic Insights

30:42 Scaling a Global Business

35:59 The Role of Intuition in Decision Making

39:00 Raising Capital in a Challenging Environment

45:41 The Future of Fintech and AI Innovations

Find out more about InDebted – https://www.indebted.co/careers/

You can find previous episodes with Josh – 

2020 – https://tieronepeople.com/2020/11/11/josh-foreman-indebted-fintech-australia-podcast/

2022 – https://youtu.be/iA0j-yejKDQ?si=ibKW4oNXZUxHaJpg

Full transcript.

Lightly edited for readability — filler words removed, wording otherwise unchanged.

Dexter Cousins
Today’s guest is Josh Foreman, CEO and founder of InDebted. I first invited Josh onto the show in 2020, and I’ve brought him back to talk about their remarkable progress over the last five years. It’s an amazing story — from writing the first line of code to now being the CEO of a fintech in seven countries that recently raised US$30 million.

Welcome to Fintech Chatter. I’m Dexter Cousins, your host and the founder of Tier One People, the executive search and recruitment firm dedicated to helping high-growth fintechs hire exceptional people. Before I chat to Josh — if you’re new to the show, give us a follow on your podcast player of choice. And if you’re watching on YouTube, give us a like and subscribe. It really helps us get great guests like Josh onto the show.

Josh, welcome back to Fintech Chatter, and welcome back to Australia.

Josh Foreman
Thanks, Dex. Good to be here.

Dexter Cousins
That’s probably the jet lag kicking in. You can tell you just got off the plane. I feel honoured that I’m the first stop on your trip back. This is your third time on the show, so we’re not going to talk too much about the history of InDebted — we’ll refer people back. But for listeners who don’t know InDebted, could you tell them about the big problem you solve?

Josh Foreman
Definitely. We’re trying to fix the broken industry of debt collection, and we look at that across three dimensions: the way you contact consumers, the strategies you deploy to engage with them, and how you ultimately treat them.

Think about the consumer experience as more of a product. Traditional collections is very much a phone call, analog type of approach that lacks a data-driven approach, and also lacks an empathy and understanding component. When we founded the company it was about how we stitch those three things together and invert it.

So think of us as an AI-enabled collections business that predominantly uses digital channels to engage consumers. We use machine learning and AI to determine the strategies we use to engage those customers, and we treat them with empathy and respect — thinking about how we help them become financially fit, rather than chasing people for money.

Dexter Cousins
I recall the first time you were on the show and I got really excited about the proposition, mainly because I’d recruited in the past for the debt collection industry and knew how difficult it was, not only from a business perspective but also the customer experience. It’s five years since you were first on the show.

Josh Foreman
It was 2020. July 2020, I think.

Dexter Cousins
Not much happened that year. Obviously a lot has happened, but technology has evolved as well. How has that shifted the InDebted solution?

Josh Foreman
It’s definitely relevant in the last 12 months. The business has evolved as you would hope, and we’ve had to overcome scaling challenges, particularly from a technology perspective. Going into more markets presents challenges.

The last 12 months with all of the AI work, particularly the generative AI stuff, is the craziest period I remember — both in my nine-year journey of InDebted and before that in prior businesses. At the surface level it’s starting to touch the org, as I think it is for everybody. I’m sure you use ChatGPT every day; I was using it on the plane on the way down here. But it’s now about how that actually changes the overall offering and solution. There are very much exercises happening where it’s: with a blank sheet of paper, how would we approach the business today, both from a technology perspective and a people perspective? And it’s iterating and changing by the day, because that’s what’s happening with the tech.

Dexter Cousins
Over this last decade, in every conversation I’ve had — whether with a bank CEO or the founder of a ten-person business — the innovator’s dilemma has got more intense every year. Now you’re constantly asking yourself, is what we’re building today even relevant?

Josh Foreman
Totally. I was reading a letter sent from Tobi, the CEO of Shopify, to his team overnight in the US. I was reading through it on X this morning. It talks about how they need to evolve to work in an AI world — AI utilisation and AI effectiveness, how well you use the tools, is going to impact performance reviews moving forward. Monitoring utilisation, how many users are doing one request a day versus ten. And no more headcount requests across the whole of Shopify unless you’ve proven you cannot do it with AI.

All of these things are evolutions of everyone looking at where the leverage point is. It’s exciting, but as you mentioned with the innovator’s dilemma, I definitely think back — what would it be if we were at day one now? I know it would be a very different journey. So how do you still look after the beast of the business — we’ve got a big company and hundreds of employees — and at the same time take a step back and think about how you’d almost innovate yourself out of that equation?

It’s a challenge. It’s not at the same scale a big bank or a large enterprise would have to do, but it’s still not as easy as it would be if we were five people starting today with a seed round.

Dexter Cousins
Back to the InDebted problem and the solution — are you geared towards consumers or B2B?

Josh Foreman
Almost exclusively consumers. We bought a business in October of last year to bring a software angle, and that has some utilisation around the SME space, but if you look at it as a percentage of revenue, it’s 99% consumer. That’s by design — that’s really where the TAM is. It’s enterprises engaging with consumers to help them recover debt, so think of a credit card company, a telco, a utility.

The SME space is complicated, whether small or large, because usually if it’s very small it’s more like a consumer — an individual director, a one-to-one engagement. If it’s a big business you’re dealing with administration processes, legal processes, and that doesn’t lend itself as well to technology.

Dexter Cousins
Consumer fintech is much harder to make successful than B2B. How have you navigated that challenge? You’re now in four different countries?

Josh Foreman
Seven.

Dexter Cousins
Seven. So how have you navigated that early growth period to get the scale and momentum you need in a consumer fintech?

Josh Foreman
On a pure B2C basis, if we were a Revolut, there’s a level of hard that comes with that which is unique. We get it a little easier in some ways, because I look at us as a B2B2C business — we engage the creditor, think of that as a bank, and then work with them to engage their consumers.

But in the same vein we have this consumer focus piece, which is challenging. The predominant communication we’re doing — millions of messages a month — is to consumers, and they know InDebted as a brand helping them repay their debt. At the same time we have to position the brand towards: hey fintech, hey bank, this is why you’d want to use us.

Dexter Cousins
A little like the BNPL side, where you look at the success of Afterpay. It was: hey merchant, if you want to see your sales go like that on Saturday, use this. And then: hey consumer, if you want to look like this on Saturday night but you don’t have a credit card, use this.

Josh Foreman
That’s a great analogy. What Afterpay did so well — and Klarna has done the same, and Affirm and Zip and others — is they leveraged the consumer side to help them win on the business side. Obviously you walk in and want brand A, let’s say David Jones, but what you can also bring David Jones is: we’ve got X millions of Australians who love our app, and you want them to shop here.

We try to do the same thing. We want to be front of wallet when the consumer has the capacity to pay. We want them to pay us — our clients — first, because of the experience they had with us. I remember very early days when we raised our Series A, Dean from Carthona, our investor at the time, was doubling down on the consumer feedback. The fact that we got these five-star reviews from customers in collections, and taking that and using it as the marketing collateral to go and win clients. That has held true pretty well. It’s evolved over time, but this idea that we are who consumers prefer to engage with, and that’s why business A should work with InDebted.

Threading those two needles is very difficult from a marketing and brand perspective.

Dexter Cousins
The traditional model was to buy debt at a discount and try to recover it. How have you changed that model, and how are you disrupting it?

Josh Foreman
It’s a very timely question, because there’s a lot we’re thinking about in this space right now. Debt buyers still exist, and some of the biggest players in the world are still in that category. In Australia, Credit Corp is an ASX 200 business that does exclusively that.

By virtue of the fact that we’ve become a technology business, and we’re chasing technology-type financials — we want our business to look like a software business — we can’t be a balance sheet heavy company. So we’ve always said we won’t go into debt buying.

That’s also been validated at a macro level. Two out of the four big banks in Australia haven’t really done debt sale for the best part of a decade, and the volumes in the other two are small. In the US you’ve got a dichotomy: Bank of America doesn’t sell, but Citi does. So overall debt volumes have been pretty low, and you combine that with the broader macro where interest rates were low.

That has definitely shifted in the last 12 to 18 months. We’re seeing debt volumes surge. The buyers are active. The large publicly listed ones in the US have deployed more capital in the last 12 months than in the previous three or four years, so there’s a lot of volume out there.

We’ve done two things. In the United States we’re working with those organisations. People who would usually be viewed as competitors are actually really great clients of ours now. They recognise they’re trying to transform internally — they don’t want to be these 9,000-FTE organisations — so they’re embracing technology leaders like ourselves. We really like that. It’s geography specific; that’s a very US thing. Australia less so.

Then there’s the timeliness, because we’re trying to think about how that evolves. The part I like about debt sale isn’t the arbitrage opportunity of someone buying it for one cent and making three. I like it almost as a product feature, where a client — let’s use the BNPL example — wants to pull a lever of liquidity, to get access to two or three million. Their choices are go and take a loan, or liquidate these overdue accounts.

That’s where I have a lot of interest: how would I productise that as a feature and put it in front of our clients? So a Zip or an Afterpay can log in and see, we’ve got X number of accounts placed with InDebted and this is their historical recovery rate. They’re offering a slight arb on that, but I get all the money today, and the consumer still gets the exact same great InDebted experience. I like it that way, but it’s still early days.

Dexter Cousins
And on the flip side you’ve got the debt consolidation piece for the consumer. Is that something you’ve toyed with?

Josh Foreman
I’ve toyed with that idea a few times. It’s hard.

Dexter Cousins
It’s been tried a lot, and failed a lot.

Josh Foreman
Passion project wise, I love it. It’s funny — I had this conversation recently with the founder of a very similar business to InDebted in Colombia, and he has the same level of enthusiasm I had in the early days. The business model is the challenge with that one.

But it’s ripe, and what needs to happen there is what has happened in collections. Whether it’s an InDebted or TrueAccord or PAIR Finance, all these companies have done a really good job of changing the consumer experience in collections. That has not been done on the debt consolidation side, and when you pull through the business models, it’s about as predatory as you could get.

Dexter Cousins
I want to talk about the journey you’ve been on these last few years. Last time you were on the show you’d just made an acquisition in the US. Your business was a little more simplistic then. Talk us through how you’ve evolved since that first acquisition.

Josh Foreman
For context, we decided to go into the US market in 2021, on the back of an expansion into Canada in 2020 — those clients dragged us into the US for a whole bunch of logistically complicated reasons. We bought a business in order to get the licensing infrastructure in the time we needed.

We spent 2021 digesting our first acquisition, never having done one of these before. That was fun — particularly on the other side of the world, when we couldn’t travel and all the Covid stuff was still an overhang. We also launched our core product, and those Canadian clients went live in the US about mid-2021, and we scaled out from there.

The challenges, and the evolution, were multifaceted. One is that the acquisition went incredibly well, which was a good thing, but we didn’t expect it on its own to grow at the same time the US business was growing organically. Very quickly, by mid-2022, we were looking at it thinking: the business is now predominantly US. And we were an Aussie exec team — my first flight back to the US was January 2022. It was a really weird scenario.

That meant a huge shift. How do you support the majority of your clients being in another market? There were a lot of growing pains, and still are, around how we shift resources — exec team presence, local presence, client presence, engineering presence — to adapt to that.

At the same time we realised we’d unlocked a new growth lever in M&A. We’ve done a few more of those transactions since, because it became really insightful. There’s a list that goes out to here of all the things you don’t want to do, and we’ve gone through all of those. But there were a lot of powerful levers as well, in terms of growth acceleration, speeding up market entry, and being more successful having boots on the ground.

That catalysed the question of how we go from two markets, Australia and the US with a couple of small ones around them, to where we’re looking at the business now — our plan to get to 30 markets over the next four or five years.

Dexter Cousins
Talk me through some of the other markets you’ve gone into.

Josh Foreman
Australia, New Zealand, Canada, the US, the UK, Mexico and the UAE — with the UAE being last month and Mexico just before Christmas.

Take a step back: why do we go anywhere, and what’s the rationale? Almost exclusively it’s driven by clients. Today, over two-thirds of our revenue comes from clients that use us in more than one geography. That’s become a real competitive advantage and part of our growth flywheel.

You get a client in Australia, that’s great, then we’re in New Zealand and they go to New Zealand — oh great, we can use the same supplier. Then we’ve leveraged that into Canada, into Mexico, into the US. We think that’s a good path to follow, because Stripe did the same thing with early customers, and it helps reinforce that stickiness and makes the value we provide better.

It also gives us confidence. What do we know about Mexico? It’s a beautiful place to go on holiday, but I would never run a fintech business there. So how does that manifest? It’s a lot easier when you have an anchor client that trusts you and you can work through those things together.

Then we also look at market dynamics: does it have some of the properties we’d want to see for fintech to thrive? A market I’m spending a lot of time looking at right now is Brazil. You’ve got Nubank there, which has become one of the best fintech success stories that doesn’t really get spoken about, even though it’s a large publicly listed business now. A bank that originated just under a decade ago now has 110 million customers, which is insane.

We know here in Australia that the consumer banks are Westpac and CBA. Imagine tripling that level of penetration, where two out of every three Brazilians use Nubank. That’s just insane.

At the same time, they’re starting to follow what you’re seeing with the Revoluts of the world — they’re not just dominating their home market, they’re going into Mexico, into Colombia. From the most recent chats the CEO has done publicly, it’s pretty clear they’re looking at the US and the UK. We think that’s where fintech’s going. We think those global brands are going to be the ones that win, particularly on the lending side.

Dexter Cousins
One of the things I’ve been vocal about these last few years is the embedded finance piece. It’s not that I don’t believe it works — I just think it’s really difficult if you’re a startup trying to get funding to tackle these problems. I look at Wise Platform as an example. Nubank is one of their customers. Five years of building, 500 people, hundreds of millions invested. A massively complex problem to fix. But when you do, you start working with Nubank and Standard Chartered and Morgan Stanley.

What’s been your biggest learning going from the early days of InDebted, where you were an extremely talented founder but didn’t have the experience and you were on the tools — I remember you talking about testing the product that first time and it worked and you thought, wow — to now? How have you evolved your thinking around an enterprise platform and what it actually takes to compete on the world stage?

Josh Foreman
It’s a great question. As the business has become more successful, my belief in what the company can be has accelerated almost exponentially, which is usually the inverse.

I had this conversation with my COO this morning. If you’d asked where we would be in year three, would you think we’d be where we are at year nine, six years later? We can both unequivocally say no. There’s no way we would have thought we’d be in seven markets with this number of revenue.

So if you apply that same dimension and go, now we’re at year nine, what do we think we’ll be at year 15? When you have a 4x or 5x growth target, you go — well, we did nearly 10,000x over the nine years before. Is that really the case?

When you look at parallels in companies like Stripe, or Wise, or Revolut, you look at how long it took to get to 100 million of revenue, or a billion, and then you look at the more recent years and that chart starts to accelerate. There’s a level of scale advantage. The best example I’ve seen with Stripe recently was a new product that launched about 18 months ago and it’s already at $500 million ARR. You can imagine how hard it would have been to get five million in the beginning for the whole business, and now you can incubate a product and it does that.

Why that’s important for me is it’s helped reframe just how big we think the business can be — and that the business is going to evolve way beyond collections. I look at it more like credit infrastructure. Our clients need more things from us. They don’t just need you to collect the debt. They want the software to do things internally, they want the data to make decisions, they want backup loan servicing support. So once we build that foundational platform, that’s one.

The second part, on the tactical side, is having the time to look back — as you said, get off the tools and go, okay, if you deconstruct it step by step, what actually got us here? I did that exercise over Christmas and January this year, really looking at the M&A component, the organic component, the multi-market component. When you get the time to dig into the data, you start to see there are absolutely playbooks playing out, and then it’s how you execute across them.

I’m not close enough to know the Revolut and Stripe details, but you start to see similarities — like following Uber into all the markets, which is what Stripe did in the early days. Revolut now seems to launch in, I don’t know which country they’re not in. It’s every single day, they’re everywhere. There’s obviously something there that’s played out, and you see that manifest whenever I speak to investors. The last number I heard was something like $3 billion ARR growing at 100%.

Dexter Cousins
Tell me more about the credit infrastructure piece. I’m curious, but also because if I look at a common denominator between the Aussie fintech success stories, a couple really stick out — the calibre of the founder, their intellect and problem-solving capability, that has resulted in them creating a new category. Spriggy, for instance. BNPL. Talking to you about InDebted, it’s almost like you’re creating a new category now, where bits of it have existed — like Spriggy, where you had Dollarmites.

Josh Foreman
The first part goes back to what I mentioned before: I think the global brands are going to win, and when you have to do things globally, as you mentioned with Wise, it’s so complex. So where do you even start? Once someone has built that infrastructure and plumbing, it’s too good.

The best analogy for us is that we use Stripe for our payments. If we had to use a different payment provider in every single country we’re in and want to go to, it becomes infinitely harder, because we’d have to do different payment integrations. We can’t get scale — a whole bunch of technical challenges. So my bet is that by having that distribution layer on our core product, we’ll be able to fill that part of the piece.

The natural extension, from a category perspective, is to look at the businesses I think have been very successful tangentially to what we do. Rather than looking at the Credit Corps of the world, which are phenomenal businesses, I look a bit more at Experian and FICO. What you see very clearly is that it’s about following the customer lifecycle and becoming vertically integrated, because you become more valuable to those organisations, and it’s easier to sell to people who are already customers than to ones who aren’t.

Another great example is a cyber security business in the US, Palo Alto Networks. What became a one-product hardware company is now a cyber security platform with a $190 billion market cap. What they knew was: we already have all of the clients, they buy these little bits of hardware from us, why don’t they just buy all the software and all the add-ons and all the IT services and support from us? That was the thesis. Nikesh and the team did a really good job and executed, and you’ve got a business that’s gone from 400 million of revenue to 9 billion.

My thesis is around that. We’re right there. I don’t want to get into originations or areas we don’t have a right to play in. But on the tangent of where we are — they need us to collect debt, okay great. They also need backup service providers in the event their lenders aren’t comfortable. Why aren’t we playing in that space? They need data to make informed decisions — we have so much BNPL data and customer data and insight data. Why can’t we support that?

What we’re trying to understand is what the boundaries are of where we should play, then own that space really well and grow vertically inside those clients, and hopefully create a flywheel where one client coming onto one product becomes easy to get multi-product, and the data you get there helps sell the next logo.

Dexter Cousins
It’s going off on a tangent, but I think it’s one of the reasons marketing seems to be at such a crossroads right now. What I’m seeing in marketing is this approach you’ve got, where the flywheel comes into effect. It’s very difficult if your mindset is B2B or B2C rather than customer — and at what point in that lifecycle is the customer? If they’re a client, they’re still potentially thinking of it through their customer’s eyes.

Josh Foreman
Totally. It also manifests in how you position yourself as a business. We were speaking about this in the last few days — thinking about the brand of the company and how you want to be positioned, and where you balance between this is core and what I want to do from a marketing perspective, how do I generate business, versus ambitiously I want to go into this area and I don’t want to box ourselves in. We want to have those exploratory conversations. We want people to think of us as someone to go to on things we maybe don’t even do today, so they can feed into how we think about the ecosystem we want to build.

I know I mention Stripe a lot, but they do this so well. If you go to their product page and compare it to where it was five years ago, all of these new services have manifested, and all of that has come from customers saying: you do this for me, right next to it is this, and you don’t do that — and if you did, it’d be awesome. I need you to help me find fraud, because I’m processing a billion dollars of credit card payments. And now you’ve got a fraud product that’s one of the best in the world. And a card issuing product. And most businesses are online but they also have in person, so there’s a terminal business. That’s a great way to think about building a real platform company.

Revolut is another one. You go to that website and there’s the business and there’s the consumer page — two totally different markets but really one unified view. For a long time people thought that couldn’t be done well. You’re either the business bank or the consumer bank, and one does one well and can’t do the other. That’s not so true now.

Dexter Cousins
The key is listening to customers. Real, proper product management, and solving their problems. It really is that simple.

Josh Foreman
100%.

Dexter Cousins
As a leader, as a CEO, how have you adjusted to managing a global business, and what has that meant for the culture? I’m thinking from the perspective that you’re now operating 24/7. When do you get the opportunity to switch off, and how have you coordinated resources so you can operate that way?

Josh Foreman
Very transparently, it’s a work in progress. It’s not perfect by any means, and this is actually where being a startup is a good thing, because you can iterate fast. What worked well for 2022 to 2023 was good, and then it started to break in 2023–24, and then you fix it and it starts to break in 2024–25, because you’ve got different dimensions.

We’ve done a few things. One is I moved to the US, where the biggest market was. That was a decision between myself and the board — to be where the success of the business rested. That helped in the sense that you’re in front of customers, in front of clients, you can spend time with them, understand local talent. You have to be where the gravity is. Now that may shift soon, where gravity is over 30 countries, and I don’t know how to do that exactly unless I can replicate myself.

The other part is how you think about org design, and this is where, again transparently, we got a lot right and a lot wrong simultaneously. What has become very apparent is there’s a very big difference between a market that’s in the early days of its journey and a market doing $30 million of revenue with 150 people. So we’re very much now — and this is literally over the last three months, starting to bed down, with plenty of teething issues — really regionalising the business.

I look at what I did when I moved to the US and I replicate that. You need an MD or president in that part of the business. So we hired someone, but they can only be as successful as the infrastructure that supports them. If you’re there and you’re the top dog in the US and can make all the decisions, except you’ve got to wait for engineering to sign on in Sydney and it’s currently a public holiday — how does that work? Those are the challenges we’re trying to understand. Does that mean you rebalance? But then there’s a cost differential — if you looked at the Aussie dollar in the last 24 hours, it’s basically double the cost to put it into the US versus Australia. So how do you balance those things?

It’s very much an iterative process, trying to move at the speed of a startup. There’s a lot of bureaucracy as you scale. You go, okay, this looks good, we’re going to reorg in six months — but you’re probably going to need to reorg again at that point, or at least rethink certain structural elements. So waiting six months and planning that out doesn’t necessarily help, because other things are going to change, two new markets are going to launch, and we didn’t think about X, and what about Y.

The next thing I’d say that’s relevant to the audience: I really like the benefits remote work has brought, but I personally miss the office a lot, and I miss what that brings. Does that mean five days a week? No. That’s up to each individual business. But there’s something from a culture-building perspective around the people you’ve been in those trenches with, where it’s not someone you only know over Zoom.

That’s why I’m leading to the regionalisation model — the ability to build these hubs. Klarna is a great example: a giant global business, but the whole exec team is in Sweden and they’ve stayed true to that the whole time. There are lessons there. And you see the opposite angle as well, where they’re completely dispersed. It’s trying to understand the right balance between a nice, efficient, agile global structure and a proper regionalised business that can independently run its own time zones.

As for me switching off — that doesn’t really happen too much, but I try to as much as I possibly can.

Dexter Cousins
I don’t want to get too airy-fairy, but the example you gave about moving to the US and immersion — we have to remember we’re biological machines. We’ve got so many different sensors that are data collectors. For you to sit here on a screen doing Zoom calls and researching stuff about the US, versus being on the ground and absorbing everything — the smells, people’s body language, the whole thing. You just go, okay, I’m on the ground and now I get it.

Josh Foreman
I couldn’t agree more. Danny, one of my investors and board members, is always on me about documenting my algorithm, as he calls it. It is those things you mentioned.

A perfect example: I went to the Middle East, to the UAE and Dubai, to spend time with one of our clients. Three years ago this was just an organic conversation between two board members, an introduction to this billion-dollar growing business in Dubai. I could tell straight away — we will be here one day. And it wasn’t just because I wanted it to be that way. It was all that qualitative piece you mentioned. I walk around and think, okay, this business has got the culture that’s going to take off, it’s already got the run rate, it’s a buy now pay later company that’s exploding, there are a whole bunch of market dynamics.

And sure enough, that $500 million business is a $4 billion business today. And a couple of quick conversations and you realise there is no InDebted equivalent over there. You’re like, there’s a gap, and it’s going to happen. And it did.

That’s all the stuff you don’t get over a Zoom call, or over reading ChatGPT output. It’s when you’re actually speaking with customers and you’re there and you think, this is the right market for that to happen. Whereas I’ve been to other places and thought, yes, there’s a great market, I’m sure the TAM is huge — you can just tell this is too hard. India is a great one for us. There’s a lot happening over there, a lot of investment in collections, but in the few visits I just don’t know where we’re going to have any advantage right now. It’s a huge TAM and that could excite an investor on a slide, but execution’s hard. Whereas here’s another TAM that’s a lot smaller, but I think we can get 50% market share. So let’s run to that one.

Dexter Cousins
It’s amazing, when you hear the narratives out there about what makes a great founder, it’s all seller story, it’s all about selling. None of it’s about intuition. Intuition for me is the number one indicator of success, because that feeds through into everything — customers, opportunities, talent, decision making, strategy. Gut feel is called gut feel because the biggest collection of nerve endings is in your gut. It’s saying there’s something not quite right here, I can’t put my finger on it, but I’ll figure it out sooner or later.

Josh Foreman
I gave this feedback to one of our execs recently: your intuition is the data. They said, but I don’t have the data. Well, you do — you’re just collecting it in a different way. You haven’t put it in Excel, fair enough. But there is a tipping point where you have to go, I know this is the right thing to do, I’m going to opt for speed and momentum and get it done, versus waiting three months so I can put in a spreadsheet what my body is already telling me.

One of the early exec coaches I had spent nearly a year with me on this exact thing. You are leaning too much into the data, too much into what book A says you should do or blog post B, and you need to default back to intuition. There are times when you shouldn’t, of course, and understanding when to balance that. But when you do something for nine years, there’s a lot of data collection happening.

Dexter Cousins
I say the same thing with recruitment. I’ve written all of mine down as well. There were little things — I was talking to a colleague and they were giving an offer. I said, you’re giving it on Friday afternoon. It’s the worst time to give an offer, because they go the whole weekend. What you need to do is say to them: I need you to call me at 8:30 on Monday. I don’t need an answer, I just want to understand how you’re feeling. If they don’t call you at 8:30 and you’re calling them at nine, they are not accepting that offer. They might tell you they are, they might give you all these other reasons, but they’re not accepting it.

It’s those experiences you have — the pause in their voice, all of these things that come together. It’s really about craft. And we don’t consider being a founder as a craft. If we did, VCs would have a much easier time figuring out who to put their money behind.

Josh Foreman
It’s so true. But you must be able to get to a point now where you’ll interview an executive and know right away if they’re fit for that role.

Dexter Cousins
Revolut’s a great example. I worked on the CEO search, which was 2019, and I got bombarded — it got out on market that I was doing the search, and I was getting all these calls from EAs of banking execs saying, my boss is interested and he wants to meet you on Friday at 10am. Flag. I can tell you now it’s not a fit. Whereas if I was a couple of years into my career I’d be going, wow, a bank exec wants to meet me. Now I’m like, yeah, whatever.

Josh Foreman
Totally.

Dexter Cousins
It’s those experiences you build up, as long as you’re aware. The key is documenting it and creating your algorithm. It’s not E=mc². It’s: somebody does this, this and this, and there’s a 90% probability the outcome is going to be that. And when it’s not, rather than getting distraught that a bad decision was made and there’s this cleanup —

Josh Foreman
It’s like, well, that data point suggests I don’t know what I’m doing, so let’s discard it. I’m less of that. Maybe it’s the optimistic view, but how do you take that and reiterate it into: there was a reason why this one market didn’t work where the other six did. If you can feed that data out, you hopefully miss the next two where you’d make the same mistake.

Dexter Cousins
I have to keep reminding myself as a business owner that problems are a privilege. When I get my head going, I say, okay, problems are a privilege. Get on to it. Solve it. There’s a solution.

Josh Foreman
It’s hard some days though. Every problem seems to manifest at the same time.

Dexter Cousins
But that’s the other trick — figuring out what’s a problem. Sometimes the best solution is to do nothing. It’s resisting that urge of, I’ve got to fix everything, we’ve got to make it all right. Sometimes you have to recognise that actually, just leave it. If it is a real problem, let that fire burn. It might just burn itself out.

Josh Foreman
I totally agree.

Dexter Cousins
Moving on to the future. There was some big news at the end of last year — the Series C. Everybody’s been finding it tough since the last time you were on the show. What was the big secret for you? It was a fairly significant raise.

Josh Foreman
I don’t think it’s a real secret, in the sense that investors are being much more diligent on placing their bets. Capital’s harder to come by. If it’s harder for us to get, it means it’s harder for them to get, so it goes all the way up the chain. LPs are being very conscious of who they allocate to, and therefore VCs are doing the same thing.

We had to touch on a couple of things. One is we had to have our numbers in place. We were growing really well, margins had improved, and we’d really heard the market in terms of the swing from growth at all costs. We actually hit profitability leading into the raise, which was part of the strategy — demonstrating that we can pull the levers. We don’t think we’ll ever go back to 2021 craziness. We’ll find the right balance point, and there is a trade-off between profitability and growth. But showing that in the event we need to, we can pull that lever back, was helpful.

The other part is that we’re doing something really unique. Yes, there are competitors, but we’re not another payments company, we’re not another lending business. We stand out in that regard, and we’re solving a real problem that people can see is globally an issue.

And then the other side of the macro. A lot of investors at the time were looking at it going, there’s probably something that’s going to happen here. As of this morning there’s $1.25 trillion of US consumer credit card debt. Interest rates are as high as they’ve ever been. Jamie Dimon is saying he thinks we’re in a recession in the US, and the tariff stuff — I don’t want to get into the politics, but all that’s melting down. At some point you can see a manifestation of a bubble here. And you’ve got this whole new category of lending through fintech that is just exploding. People thought BNPL was a fad, and now look at how many people are using the product.

There’s a lot of credit out there, and a key part of making the credit infrastructure work is that the money has to go full circle back. If things don’t get repaid, the whole process breaks. Sometimes people push back and say, why would you want to be in collections? I get all the reasons, and they mean it from a good place. But the reason you pay X% on your loan is because of all the people who repay and don’t repay. If no one repaid, then your mortgage and mine would be ten times what they are. It’s all about the risk-adjusted return component. So it’s a critical part of the infrastructure that enables people to access good credit. There has to be someone to solve that and look at it at scale, and we want that to be us.

Dexter Cousins
I’ve come up with an algorithm around what I’ve observed here. The complexity of the problem, plus the size of the problem, plus the quality of the founders, will determine how much you’re going to raise — if indeed you are going to raise. There have been only three or four fairly significant raises in fintech over the last 12 months, and every single one of them has been tackling a really complex problem that’s global, and the founders are top of the tree. If you’re not hitting those three things, it’s tough.

Josh Foreman
On the positive side, the Australian venture ecosystem is evolving so quickly now, and that’s exciting. We set out — and not through ego or any reason — we didn’t include any Australian VC in our process, because we just assumed it wasn’t going to happen. You’re not going to get that ticket size. We know everybody already. They’re either an investor or they’ve passed.

So I spent five and a half months literally flying between New York and London, back and forth, doing the process — only to end up taking AirTree, taking the team, and ending up back in Australia.

What has happened goes back to that LP piece. You look at them as a fund, and they’re not the only ones, but the one I can speak to easily — they’re now diversifying away from just superannuation funds being the source. They’ve got university endowments in the United States, and people in Europe and Asia. They themselves are realising that as you deploy more and more capital, keeping those returns where you want them is hard. There are a handful of funds here in Australia that have these outsized return profiles, because when you hit them, they hit the power law big time. Canva is probably the greatest one of all time — a beyond category-defining company, a once-in-a-lifetime business, and it was created here. People look for that.

So that’s helpful for Aussie founders. You can stay focused and disciplined, touch those three things you mentioned, solve a big problem, do it really well, hit your numbers, and be a great team — and beyond just the founder, make sure you’ve actually got a solid executive team. There is a rich ecosystem that can fund you here if you can get it right.

It’s an exciting time for all the AI businesses. I spent some time with some at an AirTree summit recently, seeing all these three- and four-person companies doing all this stuff with no people, thinking, this is cool. You’re able to get a lot further than we were back in the day.

Dexter Cousins
Which takes me to my final question. You alluded to a moment of uncertainty we’ve probably not seen since the Covid lockdowns, with global markets and tariffs. What’s got you excited about the future, and what do you see as the path forward for InDebted and the Aussie fintech scene?

Josh Foreman
It’s the most cliché tech founder answer, but AI, for sure. I’ll say this somewhat tongue in cheek: I wish I was unemployed right now, because it’s a great time to be spending a lot of hours in front of your computer learning new skills and playing around with things. It reminds me of when I was 14 building my first website, thinking, you can build these e-commerce pages — and that led into my first business.

We are at a point where this is bigger than mobile, bigger than Web 2.0 and cloud. This is everything. There will be businesses created that we can’t even wrap our heads around. And the bar has continued to be lowered. You don’t even need to know how to code any more. You can teach yourself and do most of the work with ChatGPT on a $20 licence. The orders of magnitude have come down. So the whole idea of not being in Silicon Valley or New York or London, of being an Aussie business — I think all of that goes away. It’s really exciting.

Dexter Cousins
There’s been a lot of talk about when the first billion-dollar business with one employee will happen. It’s going to happen. I said that on my podcast two years ago.

Josh Foreman
I listen to both sides of the AI thing, because there is a lot of hype cycle. We talk about this internally a lot — don’t overreact to things. Investors spend all this money, you see these crazy term sheets at crazy valuations. You have to put that on one side. But we are seeing the fastest growing companies that have ever existed. Whether you think OpenAI is worth $150 billion or not, it has reached its number of active users faster than Facebook or Google or any business before it.

And then there are all these other ones — Clay and a whole bunch of the AI-native apps. I saw one the other day I’d never heard of. You prompt it and it builds you an e-commerce website. Fastest growing tech business in European history. They went to something like $15 million ARR in 43 days, and it’s nine people. It’s insane.

So that is real data, and people need to thread both of those needles carefully. I’m not fully sure we should be spending billions of dollars on new foundational models every day, but I’m not the right person to make that call. The companies and real business problems that’ll be solved, though — I think that’s real.

Dexter Cousins
That’s the beauty of it. Ideas are back. It almost feels like we’re back to the early 2000s, where Atlassian sprung from a garage and a credit card. It feels like those days are coming back very quickly.

Josh Foreman
There’ll be such big unlocks when you get there. Have you been in a Waymo, one of the autonomous cars yet?

Dexter Cousins
No.

Josh Foreman
When you get in one, you start to realise there’s a lot of difference between the talk and the reality. When you take a 30-minute drive in a car with no other people but yourself and it’s driving itself, you go: sci-fi movie. But then you look at the numbers, and I believe there are more rides happening with that in San Francisco than there are Ubers now. It’s happening right before our eyes. And yet you say to the average person, have you been in a driverless car? They say it’s a fad.

Dexter Cousins
All these poor kids though — well, I say poor, it’s probably great for them. But they’re not going to learn how to drive.

Josh Foreman
I had this conversation with a friend of mine who’s got a one-year-old. Will she learn to drive? Don’t know. Probably not. That’s a whole other thing to think about. But it’s an exciting time.

Dexter Cousins
Josh, it’s been really great to catch up. Congratulations on all the incredible growth — it’s awesome to see. I keep thinking back to that first podcast. I think it was audio only, actually.

We get some amazing talent listening to this show. If they’re clued up on AI and using all the latest tools, and they’re interested in careers at InDebted, where’s the best place for them to find out more?

Josh Foreman
Jump on our careers page, or just reach out on LinkedIn. Love to chat and talk about opportunities.

Dexter Cousins
As always, folks, you can catch up with me on LinkedIn. I’m back on X as well. If you’re new, make sure you follow us wherever you listen to podcasts. And if you’re watching on YouTube, give us a like and subscribe. Until the next episode, keep well.