Banking for the creator economy – Q+A with XPO Co-Founder Lotanna Ezeike

Lotanna Ezeike

In an exclusive interview, Business Leader chatted to Lotanna Ezeike, the Co-Founder of XPO, a digital banking app for influencers.

What is your background and what inspired you to create XPO?

I was born and initially raised in Nigeria until moving to South London at the age of eight. My initial education took place at Blackheath Bluecoat in South London, but that was closed down due to the prevalence of gang violence. So, after passing my 11+ exams, I moved to Dartford Grammar for boys where I studied a range of subjects including economics and Mandarin, which I still speak conversationally today.

I also used to be a sprinter for England and fell into content creation by accident. After posting on Instagram, initially, to inspire others in the sport, I was reaching up to 10-12,000 followers, with high engagement. As a result, brands started approaching me and I had no idea how to manage that.

Back then, the term “influencer” wasn’t mainstream – we were more ‘Instagram bloggers’. Brands were offering me free merchandise and as a cash-strapped university student, I was happy with that! But shortly after, the conversations with these companies turned to money and I realised how confusing the process between brands and content creators was when it came to negotiating and receiving payment.

At University, I also met my Co-Founder, Tomi, who was working with a group of content creators. Tomi was facing several challenges when it came to paying content creators and compounded by my own experience, it dawned on us that there were payment issues on both sides. We decided to build a marketplace that would focus on making the payments experience more efficient between content creators and the companies that choose to work with them. Our break came when we realised that we could pay influencers much faster than they had been paid by brands before.

What are the challenges currently preventing influencers from growing and how can these challenges be overcome?

The creator economy is beset with issues. But poor payment cycles are hindering sector growth, restricting new talent, and creating gender pay gaps. Money is still hard to come by and times are hard, especially for young people that have been hit by a global banking crisis, Brexit uncertainty, and a pandemic in succession. It has made the need to be paid quickly and on time more important than ever.

What trends are there currently in the world of influencers and has the market changed in recent years?

People have always been subject to influence, and today the Internet and social media is at the forefront of this. Empowered by this medium, individuals – and brands – can create trends, alter our opinions and impact the buying decisions of millions of loyal followers. The most significant of these is how creators will continue to decentralise the shopping experience.

I see a future where the front end of online stores will die a death in the same way as the traditional high-street. Once social media has made native purchasing normal for goods and services through their platforms, customers will purchase from Instagram directly as they scroll through their feed, rather than take the trouble to find and then navigate through a shop’s website to make a purchase. There have already been interesting developments on this subject, with Tik Tok doubling down their focus to support creators in directly selling products to their followers via their lives.

Do you think the influencer industry will continue to grow and if so, what trends do you predict for the sector?

Yes, in fact, Influencers have gone mainstream, becoming a $15bn industry that 86% of youngsters want to join. The creator economy is now a $13.8bn industry, projected to grow at more than 35% per year over the next three years according to Statista. Yet there is so much more to come.

Once social media has made native purchasing normal for goods and services through their platforms, we’ll see financial models move as a result, using data to comfortably predict how much an influencer is going to earn based on the positive or negative growth of their social media accounts and support them in gaining the necessary credit score and access to finance.

Are there any challenges as a disruptor in the world of digital banking?

Banking is beset by a group of huge legacy organisations, but that also means it is ripe for change – the success of brands like Monzo, Marcus and Transferwise is testament to that. But the relationship between the world of finance and influencers is at its infancy. I used to work in a bank and I have seen firsthand the struggle creators face when trying to obtain credit from a bank, and if they do, it tends to be on inequitable terms. I wouldn’t say the banks are purposely doing it, but the systems the banks run on cannot accommodate this new type of earning potential.

Traditional banks don’t see creator income as income at all. It’s most likely looked at as a simple bank transfer, and if they don’t see consistency every time, they’re like, “Hey, this is definitely not income”. So, what this means is that I could be working with some of the best and most known brands globally, but the way in which the money comes in doesn’t translate to a ‘steady income’ in the bank’s eyes. The challenge we face is changing this perception and putting the processes in place to solve it.

What does the future look like for XPO? Any future funding rounds lined up?

Well, to put it simply, the future is exciting. We launched in August after raising more than $1 million in a seed round and already have a waiting list of more than 2,000 people. A subsequent funding round is due soon as the company growth has been rapid.

I’m also excited about speaking with platforms such as Instagram, TikTok and YouTube directly to see how we can help with their content creators. We’re aiming to get 10% of the UK influencer market (approx. 12,000 content creators) using our XPO platform by the end of 2022.