Former HSBC Transformation Head: Weathering the Crisis as a Start-Up

“It’s almost like putting money under your mattress for a rainy day. The last thing I want to do is raise money because I have to raise money.”

Chuck Teixeira was previously the chief administrative officer and head of transformation at HSBC. Today, he’s the CEO and founder of the start-up WCKD RZR. Due to the disruption caused by the coronavirus, he has had to rework his company’s trajectory for the next six months. One of the first things he did was to delay the company’s seed-funding round to later this year. 

“We’ve had to push the fundraising out, because this is about the worst time right now to go and raise money, and if you manage to do it, you’re going to get terrible terms,” Teixeira says.

When Teixeira founded WCKD RZR, a provider of data-privacy solutions, in late 2019, he had three core objectives for the company in 2020: fundraising, product development, and winning business. Teixeira’s hope was that the company could raise enough seed funding to last several years.

But by March 2020, those hopes had faded. Now, the firm’s strategy for the next few months is to lay groundwork for a more stable future by speaking to investors and prospective clients.

Teixeira says that although it’s difficult to sell or showcase his company’s technology in current circumstances, as building personal relationships with customers or venture capitalists is critical to the process, he says it has been easier to arrange digital meetings and potential clients and investors seem to have more time to talk.

He adds that WCKD RZR now has more time to dedicate to developing its solution, building its social media presence, conducting research, and focusing on its branding strategy, including publishing thought pieces.

The firm is currently four people: Teixeira, two full-time staff and one recent starter. For this year, WCKD RZR has scaled back hiring. Instead of recruiting four new engineers, the company will take on two. However, the idea is that it will open the other roles again when the company begins to generate revenue.

From a financial standpoint, Teixeira says the firm has reserved its start-up capital, and adds that as a new company, starting from nothing, it’s helpful that it doesn’t have any hefty costs or overheads to worry about.

WCKD RZR is applying for the UK’s Seed Enterprise Investment Scheme and the Enterprise Investment Scheme. Any funding the firm receives will be retained as a safety net for turbulent times ahead.

In an effort to withstand the most pessimistic of scenarios, the company aims to have enough cash to last 18 to 20 months.

As part of this journey, Teixeira has sat down with many other CEOs and founders of start-ups who are much further along in their trajectory, to glean insights from their experiences.

He says he has learned that many of them have had to reorient their business models, quickly adapt to the economic conditions, change up their development pipelines, and carefully manage cash flow.

Another big consideration is their clients’ capacity to pay for the technology.

“They had to be sensitive to the fact that some of their clients may have different struggles. For bigger clients, you would expect them to pay, but for some of the others [it’s harder], as some of them might be medium enterprises. You also have to model, will they take longer to pay now? And if you’re a start-up, managing your cash flow is very critical because you’ve got salaries to pay,” Teixeira says.

A Man’s Best Friend

Teixeira named WCKD RZR (pronounced “wicked razor”) after his French bulldog. During the early stages of building the business, he was asked to speak on a panel at a conference in Vienna. At this point, he had only recently left HSBC and still hadn’t decided what to call the company.

As a short-term solution to be able to update his bio for the conference, he chose WCKD RZR. The name stuck after eFinancialCareers covered his departure from HSBC and published the new name of the company in an article on November 21, 2019.

Teixeira has continued with the bulldog theme, and the first product, scheduled to be rolled out in September 2020, is called Data Watchdog.

The automated data privacy solution manages who should have access to data across an organization, in compliance with global regulations such as the General Data Protection Regulation (GDPR) in Europe.

Data Watchdog will be able to sit on top of a firm’s entire data stack and provide clients with an audit trail they can show regulators.

The idea for the product originated from Teixeira’s own experience, while at HSBC, in managing data transformation projects and having to move data from one location to another. He realized he couldn’t find a solution that automatically handles data privacy obligations and updates in line with constant rule changes.

“You have to recognize that in a large global corporate, they’re going to have data everywhere, they’re going to have multiple on-premise solutions and are probably using multiple clouds. And so that enablement layer, that decision-making layer about who should have access to what data, needs to be able to cut across all of it,” Teixeira says.

The start-up is in early discussions with a large broker-dealer, which is interested in taking part in its first proof of concept.

And if all goes to plan, WCKD RZR looks to hit the ground running in the second half of the year and open up to new clients.