Fireside Chat with Yoseph West of Relay

It was a pleasure to host a fireside with Yoseph West last week.

Yoseph is the CEO and Founder of Relay, a platform designed to give small business owners complete control over what they are earning, spending, and saving. In 2025, Relay surpassed $1 billion in customer deposits!

Yoseph shared some awesome insights from his journey at Relay so far. Here are a few key takeaways:

• Treat your channel partners as customers.
• What customers ask for vs. what they actually use aren't the same thing.
• If customers stick through a sh*tty product, there's something there.
• SMB failure rates don't matter if you target the right segment.
• Fintech is hard because the systems are complex and you have to earn trust every day.

Treat your channel partners as customers. Lots of people told Yoseph that starting with channel partners was a bad idea. Conventional startup wisdom says don't do channel partnerships too early because you need to learn directly from customers first.

Relay did it anyway, but their approach was different. They started by selling to accountants and bookkeepers, solving real problems for them (helping them close books 30% faster) rather than just showing up with a check and asking for referrals. They built tech that made it easy for partners to win, like a registration API that lets formation companies create a bank account for their clients with one click. The result: a partnerships ethos baked into the company's DNA from day one, and access to higher-quality small businesses than they could have reached going direct. Even though many competitors have shown up to these partners with bigger bounties, Relay wins by going deep on what actually helps their partners succeed.

What customers ask for vs. what they actually use aren't the same thing. Relay's second most requested feature was a checkbook. Customers demanded it. So they built an awesome one with security controls, thresholds, and approvals. Usage? Not as high as you would think.

Yoseph learned that many SMB requests are really about optionality. Customers wanted to know the checkbook was available, the same way they want to know a bank branch exists even if they never go. You have to listen to feedback, but you also have to make qualitative assessments about what's actually driving the request vs. what customers will use day-to-day.

If customers stick through a sh*tty product, there's something there. In the early days, Relay had 6 business day holds on deposits. It was terrible! Why people put up with it, Yoseph still doesn't know.

One of their early customers, MetalBird, went through some hairy situations with Relay, stuff that would have made most people quit their bank a thousand times. But they stuck around. For Yoseph, that was an early signal of product-market fit: if you create that much friction and your product is that rough and people are still signing up, there must be something really special that they can't find elsewhere.

SMB failure rates don't matter if you target the right segment. People talk about high SMB churn as a reason not to build in the space. Yoseph's take: it only matters if you're focused on the wrong segment.

Of 100,000 businesses transacting on Relay every month, about 15,000 pay for everything. The other 85,000? Some will graduate, some will churn. It doesn't matter. What matters is whether you've built for the segment that actually drives your economics. Even during recessions, business creation goes up as people get laid off and decide to go for it. The structural churn is just part of the model if you've targeted correctly.

Fintech is hard because the systems are complex and you have to earn trust every day. The systems that underpin a business like Relay are genuinely complex. You're dealing with multivariate problems that compound on each other, and you can't move fast and break things when you're handling people's money.

Yoseph had previously worked in software companies where if something goes wrong with your documents, you're sort of mad. The first time something went wrong with a wire at Relay, a customer chewed him out worse than his mom ever has. That's the difference with fintech: you have to earn trust every single day. In 2021, competitors raised orders of magnitude more than Relay and have since struggled or gone sideways. Capital can't solve these problems. It's fundamentally harder than people thought.