One of the main missions of software developers’ work is to deeply understand the product they are working on and the real problem that the product is supposed to solve. In the new episode of Ask Me AnyFin, we talk to Koray Koska, who tells us the story of how he turned from a software developer to a startup co-founder and how the idea of VitraCash – a smart debit card – was born. What is the truth behind the “magic” smart tools like VitraCash? And what are the biggest challenges of entering the FinTech market? Check out our interview for all the answers!

Smart debit card creator says, “Ask Me AnyFin,” and is not afraid to answer

Koray Koska is an experienced software engineer and an avid traveler who loves exploring and getting to the bottom of things, gaining experience in fields he had no knowledge about before. On his LinkedIn profile we can read his motto:

“Have the courage to step into a sector you don’t have experience in and learn your way up to.”

In 2020, he founded a startup called VitraCash, which is a smart debit card app. Before that, he used to work in various technological startups, where his main goal was to build software that solves real-life problems. 

Considering Koray’s story – transformation from a software engineer into a FinTech startup founder and the debit card revolution his company is about to start, we simply had to meet him and Ask Him AnyFin…

Watch the conversation with Koray or read the transcript below.

From a software developer to a co-founder of an innovative startup

Małgorzata Łabanowska: Welcome to the next episode of Ask Me Anything! This is a series of interviews with FinTech insiders. Our guest today is Koray Koska, CEO and founder of VitraCash, offering a smart debit card. Hello Koray, how are you?

Koray Koska: Hello, I’m good. Nice to meet you.

Małgorzata Łabanowska: I would like us to start with a personal question. Why and how did you switch from being a software developer to a startup co-founder?

Koray Koska: So my story begins in software development, like you just said. I was always in this space, from the first day, always working for startups and developing products that solve real-world issues – which are really so connected to humans, so connected to solving something which is actually happening in the world that I would say and I would consider myself to be in the startup space since my first commercial job.

The first one was actually for a US startup. They tried to automate dog walking, which is a real thing in the US. They wanted to connect people who can walk with your dog when you are working or whatever with people who have dogs. So basically, I was always in this space, I saw what difference they make, and I always had this curiosity in my mind to change something myself, to build something myself. And this led me to a few ideas I had many years ago. And I tried different things – some of them worked out a little bit, some didn’t. And I’ve learned a lot of things. And now here I am, and it’s really just like I was born into this space, and I was just never ever thinking about doing anything else.

Even if I worked, like in employment, I worked for a startup, I always wanted to see the world from somewhere where you can actually solve a problem, and not be like in the big enterprises, where I also got a couple of jobs, but it was just so different. They are at such a high level that you don’t really understand what you do, more or less.

There are positions and job roles where the responsibilities are not clear. You do something, and you don’t really know how it ends up, who will use it, will it ever be used. Where with startups, it’s just completely different. You build something which is actually used, and most of the time, you use it yourself as well. So this is something which I always loved, and that’s the reason I’m building products myself. I want to use them myself. I want to experience the difference they make. So this is how I came to be a startup founder.

The value of working on things that you are not an expert in

Małgorzata Łabanowska: Thank you, this is really interesting. And also in your LinkedIn bio note, you talk about the value of working on things that you are not an expert in. This is also an interesting approach. Can you illustrate it with an example from your own personal experience?

Koray Koska: Yeah. So basically, I would say software engineers are really good at living what this quote means. As a software engineer, if you look from a higher level onto it, you are not an expert in the things you do. Never. You never develop software, which is just software for being software. It’s always software for solving a problem from a different space. So you build software for, I don’t know, finance, you build software for accounting, you build software for… whatever. There are so many things in the world, and everything is somehow solved by software. And this is what software engineers do all the time.

And from my personal experience and from my background – something completely different from what I do right now, I just said I worked for big enterprises as well – one of the products was a risk assessment system. It was a big oil and gas corporation. And they wanted to have a tool where they can calculate some call risks for going into a country where there’s war or, I don’t know, some conflict, and calculating whether it’s worth it to go there and dig for oil or whatever.

So this was the software I built, and, to be honest, I didn’t have a clue what risk assessment is, like risk calculations in general.

I think as a software engineer, it’s most of the time like that – you have a problem, which you never heard of, and you have to understand it deeply from inside before building something for it. A good software engineer always understands what he is building.

I just used this from my background as a software engineer, and I tried to apply it to my own product as well. I want to understand something from the deep inside before actually building it. But the process of understanding it is something which I really like. This is something that was the most interesting part of being a software engineer. And this is why I wanted to continue exactly this. The most interesting part of my story, in the past, for everything I do in the future. And I really want to explore new things – to understand how they work, to understand how to use them. And then I want to solve it after I understand it.

The software that solves real problems

Łukasz Korol: Thanks, that’s quite interesting. OK, so let’s then focus on your current product, VitraCash. Let’s start maybe from the strategy that you have for this product. If you could tell us a little bit more about the target group, and on which markets you want to launch the product, what is the actual value proposition? Please tell us a little bit more about it.

Koray Koska: OK, I will start from how I got this idea, and this answers most of your questions, because like I said before, I always want to solve problems I have and I experience on my own. And I want to solve them in a way that I can actually have a solution for myself. So basically, this was also the beginning of VitraCash. I am traveling a lot. I am, by the way, currently in Bali. So since the pandemic started, I’m just in Southeast Asia.

And what I experienced when traveling is that there is a number of credit and debit cards and also different payment methods, like mobile payment systems in the US, there’s Cash App, GoPay, OVO and ShopeePay… Hundreds of different options and those things just get more and more by time, so every year you get a couple of mobile payment systems, you get a couple of debit cards from abroad, a new credit card which offers you this great insurance – but you forget about it after a month.

And my wallet just gets bigger and bigger. But it’s not about the size, it even feels good if you have 10 cards. But the problem is you don’t really know where to use them and what they offer, because keeping everything in mind is just very difficult, especially if it’s just for payment at Starbucks where you pay four pounds or whatever. You don’t really think about “Could I use this card just to spare one pence or whatever, or two pence?” – it just sums up with time.

What I have experienced is, when you are in front of the cashier, and you have to pay, and it’s your turn to choose how you want to pay, and he’s even asking, “How do you want to pay?” The first answer might be “With a debit card,” or a credit card or whatever you say.

The next thing you do, normally, is you take out your wallet, you choose the card you want to use, and you have just a couple of seconds, you have one or two seconds to choose it. And what I’ve experienced is that most of the time, we choose the same card. Just in some situations, we have this idea that this other card might be a better option. But there are not many times like that, there are times when you spend a lot, you spend so much that you actually think about it and you say, “OK, what would be the best option?”

For me, it was, this time a year ago, I was in Turkey, and I bought a new MacBook. And this was pretty expensive, so I thought about which card might be the best option. I had two options. I had the American Express with cashback, I think 0,5% cashback, and I had my Revolut card with the best foreign exchange rates. And the question was: which one is better? I get cashback from American Express, but what if it’s more than they surcharge my foreign exchange spending? And I had to calculate this, and it took me, I don’t know… 20 minutes?

By this time, I was even an expert in doing those things. But it took me some time, and I had to pay with my Amex in Turkey for something else. I knew the exchange rate because this was not public. It was really difficult to get to the conclusion that in this case Revolut was the better option. But if it was a week later, maybe the question and the answer would be different because the exchange rates change and everything changes, and we can’t really keep track of everything.

I always want to solve problems I have and I experience on my own. And I want to solve them in a way that I can actually have a solution for myself. So basically, this was also the beginning of VitraCash.

So this is how I got to this problem – and this is the value proposition. Like I said, to have a card which makes this thinking process, the selection process, when you are in front of the cashier, which automates it. To help you choose better, and to help you choose the right card you signed up for, to get the benefits you signed up for, and automate the process, which you really shouldn’t think about in this new world.

So basically, this is what I wanted to solve. I wanted to solve this issue of choosing the right card, and the reason was I had two options. The first one was to unsubscribe from all the cards, all the debit and credit cards I have, which I rarely use. I thought about this for a while, but then I said… But if I look through it, all of them offer me something I would actually want to use. 

I didn’t sign up for them just because of fun. It was something in their value proposition that got me attracted to it. It was something I really like, even if it’s like my card here from Indonesia. I have it because I don’t pay for exchange rates, not even like there’s a little bit on the Revolut side, just like to cover their costs on some days, like Saturday and Sunday or public holidays or at night. And it’s typically night in Europe when it’s daytime here. 

So basically, it’s a good idea to have this local card. And now, if I come back to Europe, I could just unsubscribe it and don’t use it anymore. But if I go back to Indonesia at some time, it would be a good option to have it. So this was not really an option for me. I said I have to know which one to use, and I have to use those benefits because I signed up for them for a good reason.

That’s why I came to this idea, and to this conclusion that having a card that automates this process, which I just can’t keep in my head, and can’t keep track of, would be a great option.

Not just for me, but for everyone else who experienced this market increase of many, many debit card products, payment systems, like mobile payments, and travelers who try to explore all of those options and who have many of those problems.

I would say this is also the main target group for us – people who travel a lot or people who live in one country and work in another country, which is also pretty common in Europe. So you have many, many people who actually live with two currencies. They have two currencies in their head. They have a salary in one currency, they pay in another currency, and they also, most of the time, have credit and debit cards from both countries. And to choose the right one in every situation it’s also, in those cases, not super easy. 

Like, there might be a time where the foreign card would be a better option, even though there’s a foreign exchange rate, but you get so much cashback for, let’s say, exactly for the Apple Store that it would make sense. Keeping this in your head is not easy. And I think those two groups are the main audience for us – people who live with two currencies or more and people who travel a lot.

On a mission to revolutionize spending

Łukasz Korol: Thanks. So the next question is kind of natural here, because the situation that you are describing, that there is kind of automation behind the selection of a card being used and for payment, it sounds like a kind of magic. So how is this actually achieved in your product? If you can share this information with us, of course?

Koray Koska: Yeah, of course, definitely. One of our core vision elements is to have transparency. And this is also true for our algorithm. We don’t want to say it’s magic. We don’t want people to believe that we do some magic for them. This is exactly what we don’t want. But to be honest, this is what I hear a lot. This is also what I hear a lot about many other startup products.

The main point here is you always have to dig into it, and you have to understand how it works from the inside to find the solution.

And I think this is what I did in the past couple of months, and this is what I came up with – a system that does two different things. So basically, I don’t want to go into technical details, which doesn’t really make sense. The main idea here is there are two big chunks of benefits and drawbacks you can get from credit and debit cards.

The first one are things with a monetary value, something like a foreign exchange rate – can be good or bad. You lose money, or you don’t lose money, something like this. The second one… sorry, it’s still the first one, is cashback points, which are real money you get. So you either get cashback and pay less or don’t get cashback and then you pay a little bit more or the normal price. There are a couple of things that have this monetary value in them. And it’s very easy to calculate with those things.

Basically, you just have to know all the terms and conditions of the credit and debit cards. You have to know the foreign exchange rates, the cashback rates, and things like that. And then it’s very easy to calculate. This is something you could also do in your head, just like I did in Turkey, as I told you before, for my MacBook. You just have to calculate it and… that’s it. Then you have the solution, right?

No, not really, because there’s the second thing I just talked about. And the second thing is something that is very different for every single user. There are people who prefer some non-monetary benefits over just sparing a couple of pence or cents or whatever. So basically, people like to get loyalty points from some merchants. People like to get miles from their favorite airline. People like to get insurance if they fly or have a hotel abroad or whatever.

So what we see here is a market where you have two things, the first one is the monetary option, and the second one is the non-monetary option.

And the question is, how do you calculate with… insurance versus cashback? Is getting 10 pounds cashback on an 800-pound flight better than having insurance in place for a flight, which is in a year? Because you might be sick, something might happen, and this insurance would cover you. So the question is which one is better?

And this is something where we developed a machine learning algorithm, an AI, which tries to replicate user behavior from past transactions and also asks a couple of questions like: “Do you prefer having insurances, or are you not on the safe side? Do you say no risk, no fun?” So questions like that. Or, “Do you like getting the miles from your Miles & More card, or don’t you even care?” Maybe you just have the Miles & More card because of historical reasons, but you don’t even collect the loyalty points anymore.

So we ask a couple of those questions. And what we then try to do is to let both of those algorithms, the first one with cash requirements, foreign exchange rates, and other monetary values, compete with the other one, the AI, which selects the card based on the user preference. One wants insurance over everything else. And we try to let both of those algorithms compete and try to give us two options, and then we choose one of those. And with time, by learning from this user behavior, our AI just gets better than the first algorithm and chooses much better than the first algorithm. And the more you use our card, the better it gets.

The smart debit card “magic” is about to happen

Łukasz Korol: Interesting. So… we saw on your website that the product is not available yet. It’s being developed right now. So if you could tell us what the actual current state of product development is. And at the same time, what is your kind of tactic to go to the market with this product?

Koray Koska: So one thing I missed before was our launch market. I forgot to answer this question, so maybe it fits here. We want to launch in the EU and the UK. So basically, Europe and the UK, this is our first big market. And this is what we also said in our crowdfunding. Basically, from a development perspective, we are very close to a launch date. We have the algorithm ready. We have our app ready with great designs and things like that.

From a license perspective, to keep everything legal and to have our licenses, to be able to actually issue cards and to send cards out, to make the KYC process in our app, and things like that – this is the big chunk we are working on right now. We have a plan to launch sometime this year, we said at the end of July. It might be a little bit later, but the aim is still the end of July. We are doing our best to actually have a launch at the end of July. But we will actually launch with just the investor group, the group of people who invested in our crowdfunding on Crowdcube.

And with those people, we will try and see how the product is behaving, see how they like it. We will change a couple of things, fix some bugs, and then we will activate the invite-only system, where those people can invite other people. And once we see that everything is going well and smoothly, we will open it up to the public later this year. This is a date which I can’t confirm right now, but it will be some time in Q3, at the end of Q3, something like that.

The biggest barrier to entry in FinTech: licenses

Łukasz Korol: OK, thanks. It seems like in the context of your tactic to bring the product to the market, there is a lot, in this financial ecosystem, that is actually driving how this product is delivered to the market. So I would like to ask you, based on your experience with VitraCash, what, in your opinion, is the biggest challenge when it comes to launching a new FinTech product? Especially on this market that you’ve already mentioned?

Koray Koska: Yeah, great question. And my answer would have been completely different a year ago. For now, I would say it’s definitely the regulations, and, from what I see, the barrier of entry for FinTechs is really, really high.

Getting the knowledge you need is really hard. But even if you have the knowledge, getting all the licenses you need, once you have the knowledge of which ones you need, is the hardest thing ever.

They make the process very, very long, and they make it so that you need really so much time to get the proper licenses and all the proper specifications.

Whatever you do, you always end up having a launch date, which is maybe in half a year, if you’re really fast. If you have all the knowledge ready, if you know all the suppliers, the third-party providers, if all of the development questions are already answered. So the only thing are the regulations and getting you set up with AML policies, KYC policies, compliance, etc. It’s a process of at least six months for someone who knows everything and has, I would say, an unlimited budget.

This is really the biggest chunk in the FinTech world. And I think this is the reason why so many good ideas need so much time to develop and to actually start offering a great deal.

I also think this is part of the reason why so many FinTech products are still more expensive or a little bit, not just like the perfect product, what they could be, just because of this very, very high barrier of entry.

And because of that, obviously, you don’t have a big market for FinTechs. It’s just a very, very small market, to be honest, compared with SaaS companies or whatever. It’s a very small market, and there’s not too much competition in it. And that’s part of the reason why there are many, many options for great FinTechs to evolve in the future. And I really believe that it’s getting better. And yeah, I think once we have a state of regulations, which is just a little bit easier to get into or once we have a company who helps with those questions, like a startup which helps other FinTechs, or things like that, to get into this space and to overcome this barrier of entry… Once we’ve got this, it will be much, much easier for new FinTechs to evolve and for new great products to come to the market.

Łukasz Korol: That’s interesting. We recently were talking to one of the companies from the RegTech space, a company that is trying to help the other financial institutions to somehow jump over this barrier of regulations, which is not so easy. In this context, I’m quite curious – how do you actually solve this problem with regulations in VitraCash? Did you have some kind of consultancy, or did you just do it by yourself? How did it work for you?

Koray Koska: So basically, as I said before, our idea in the beginning, before we had any knowledge whatsoever, was to get into the space, to get the knowledge we need. And this is what we did – we found out what we needed. This was the first step. Nobody helped us with that. We didn’t have any consultants or whatever. We just contacted people we knew, some companies who said, “We can help you with getting licenses.” We didn’t even know what those licenses were, to be honest, at the beginning. We just contacted them and found out everything we needed.

And after that, we actually had help from the outside. We had some consultants for some compliance things, but sourcing all the suppliers we need to overcome some license issues was also mainly our work. So we really tried our best not to have too much costs at the beginning, because those things are really expensive as well.

Basically, I don’t know what company you’re talking to, but I am very sure there will be some of those companies in the future. Also, bigger ones who can actually help and solve those issues for you. But for now, from what I’ve experienced, many of those companies are really expensive, and especially if you don’t have a launched product or customers who pay for you, you don’t have a big budget. It’s always very tight, and you have to know what you are spending it on. And the more you can get done by yourself, the more budget you keep, obviously.

The AI behind VitraCash

Łukasz Korol: Yeah, naturally. So let’s get back to your product. So you mentioned before that you are using AI for this kind of a prediction of what would be the best or learning what is the actual user behavior when the user is selecting the cards for the payments. And just one additional question on this topic. I’m just quite curious. Are you using, like, some kind of already developed AI models or solutions, or is it fully built from scratch by your engineers?

Koray Koska: We have engineers who are really good at that and who developed the algorithm as well as the AI. We are using some open source libraries, mainly TensorFlow, which is an AI library from Google. The model was developed by us. And we also came up with what data we need and how we collect them, and things like that.

So, for example, the questions we ask are completely from us. The data we get from it and also, like you mentioned, the model generated from this data we have, the solution we need. Something like, we have all those answers, and based on those answers and the cards the person owns, which one do we select? Something like this.

The future of VitraCash: what could it be in a few years from now?

Małgorzata Łabanowska: Thank you. One more question from me – about the VitraCash roadmap. So what is the vision for your product in the long term? What could VitraCash be in a few years from now? And do you even think about this at this stage?

Koray Koska: Yeah, obviously, from the first day, we had a bigger vision in mind – without just wanting to solve one specific issue. In general, I would say our idea is to consolidate a fragmented finance market of many, many great products, beginning with payment methods, as we do right now. There are so many FinTechs, so many banks, so many credit institutions, and things like that. They have all those great products, they offer you great deals, but none of them is perfect. And there are people who have 10 cards because of exactly this risk.

And this is why we want to consolidate them into one great product which tries to make you use all of those other great products which already exist. And this is also true for many other finance-related products. This is true for investing in stocks. This is true for so many things. And we see our future in having an application for people, which helps them manage their finances, and to use all of those great products which are out there – especially new FinTechs coming out, but also great offers from other institutions and banking companies.

So our idea and our wish is to help people get the transparency they need and also to automate tasks they can’t really do on their own to manage all of their finances.

Małgorzata Łabanowska: Thank you. Thank you for sharing your vision. It’s been a pleasure talking to you.

Koray Koska: Thank you very much for the questions. I appreciate it.

Łukasz Korol: Thank you, Koray.


Ask Me AnyFin is a series of interviews with FinTech experts and innovators who share their insights about the industry. Stay up to date with the latest news! Follow us on YouTube, and remember to check our blog because the next episodes of Ask Me AnyFin are already in the works!