How MSUFCU Builds And Backs Fintech Solutions

It isn’t an either/or decision between solving today’s challenges and making longer-term bets. The strongest opportunities do both. We look for investments that can address immediate priorities, such as reducing fraud or improving the member experience, while also aligning with the broader strategic direction of the organization.

It’s fitting that the world’s largest university-based credit union is also a front-runner in fintech incubation and innovation. That’s the reputation Michigan State University FCU ($8.5B, East Lansing, MI) has built through The Lab at MSUFCU and its wholly owned CUSO Reseda Group.

The service organization partners with cutting-edge fintech solutions to develop an array of apps and products that include financial literacy and planning tools, sophisticated communication platforms that connect credit unions and their members, digital marketing solutions, and more.

Sara Dolan, CFO of both MSUFCU and Reseda Group, and Benjamin Maxim, the credit union’s chief technology officer, share how the organization approaches fintech investing, development, and partnerships.

How does MSUFCU approach fintech innovation and investment?

Sara Dolan: We formally launched our fintech investment efforts in 2021 with the creation of Reseda Group. Prior to that, the credit union had established an innovation team to support this work.

Ben Maxim: MSUFCU’s fintech journey began in the early 2000s with a focus on digital service, starting with a member-centric website and evolving into internally built online banking and mobile apps.

Over time, the approach shifted from primarily building in-house to partnering more intentionally with providers like Visa and Jack Henry, using those relationships to test and innovate. The Lab at MSUFCU formalized how we evaluate and pilot fintech solutions.

As those partnerships matured, many fintech companies required funding to scale, which led to the creation of Reseda Group.

Reseda was designed with a dual purpose: bring MSUFCU-built technology to market and invest in fintech partners. This model also supported diversification ahead of anticipated revenue changes tied to asset growth.

How are credit unions approaching fintech investment? Future Bets explores how leaders balance immediate needs with longer-term bets, evaluate potential partners, and define success alongside mission and member value. Read the series today.

When choosing what to invest in, how do you balance your day-to-day business needs with longer-term strategic goals?

SD: It isn’t an either/or decision between solving today’s challenges and making longer-term bets. The strongest opportunities do both. We look for investments that can address immediate priorities, such as reducing fraud or improving the member experience, while also aligning with the broader strategic direction of the organization.

BM: We built Reseda around a simple idea: we only invest in solutions we plan to use at MSUFCU. We’re not looking to make purely financial or speculative bets. We focus on partners that are directly relevant to our business and our members.

We start by partnering, not investing. Through The Lab at MSUFCU, we pilot solutions and scale what works. Continued investment depends on operational performance and adoption.

We also take an active role by holding board seats and working closely with these companies. That allows us to help shape their roadmaps and build solutions that are more practical and aligned with what our members actually need.

What does success look like for a fintech investment? How does purpose play a role in your definition of success?

SD: For us, progress is a strong indicator of success. Because we invest in solutions we actually use, success is not abstract. It shows up in how those products perform in our day-to-day operations.

We evaluate fintech partners much like any vendor: are they solving the problem and delivering the service and reliability we expect?

Where it differs is the level of engagement and alignment. With investment partners, we have a deeper role in shaping direction and success also includes their ability to grow, scale, and deliver value more broadly over time.

Financial return matters but is not the primary measure. We look at operational impact, member experience, and how well the solution advances our broader strategy. Purpose plays a key role in that. The partners we choose need to align with how we serve our members, not just what they can deliver financially.

BM: Financial return is a positive outcome, but it doesn’t drive decisions.

We focus on the value the solution brings to MSUFCU. That could be usage, contract savings, intercompany revenue, or overall impact on our members. Those things matter more to us than financial upside.

Mission alignment is also a big part of it. We want to make sure we’re investing in solutions that fit how we serve our members and where we’re going as an organization. In most cases, by the time we invest, we’ve already been a client and seen some level of traction.

If something isn’t working, we’ll step back and determine whether to adjust or unwind it. Generally, our goal is to help these companies succeed because when they do well, it directly benefits our members and the credit union.

What’s one lesson you’ve learned about bringing along internal teams?

SD: Our process has matured quite a bit over the past five years. We’ve learned to ask better questions and run stronger pilots.

BM: You can’t treat this as a side project. We’ve tried that and it only goes so far. There’s a level of commitment and focus required if you want to do this well.

At the same time, not every internal team is set up to operate in a startup fintech environment. The pace is different, the expectations are different, and even due diligence needs to reflect how early-stage companies actually operate.

Part of what we learned is that you have to be intentional about how you bring teams along. Creating Reseda as a separate structure allowed us to put the right mindset and operating model around this work so we could move faster and think more entrepreneurially without forcing that approach across the credit union.

What’s one thing you’ve gotten wrong or would do differently if you started over today?

SD: Financial services continue to evolve rapidly, creating new opportunities to serve members. If we were starting over, we would continue to focus on balancing member needs with disciplined investment decisions.

BM: I think we would be much more disciplined early on about what we chose to pursue. In the beginning, there was so much interest and so many opportunities coming our way that it was easy to say yes to too many things.

We learned not everything that looks interesting or promising fits where we need to go. Today, we spend more time making sure opportunities are aligned to our roadmap and that we have the capacity to make them successful.

What’s one thing fintechs consistently misunderstand about working with credit unions?

SD: The level of regulatory expectations and documentation required to work with a credit union. There’s a lot that goes into ensuring compliance, and it can be more complex than they initially expect.

At MSUFCU and Reseda, we try to help bridge that gap by sharing those expectations early and supporting fintechs as they navigate the process. Setting expectations early creates a stronger partnership and better long-term outcomes.

BM: How mission-driven credit unions are. A lot of fintechs come in thinking about growth, exits, and financial returns. That matters, but we’re looking for solutions that are going to be here and support our members over the long term. We’re not trying to implement something and then replace it a couple years later.

Another piece is the sales cycle. There’s often an assumption that it will move quickly, but credit unions take time. There’s a lot of diligence, a lot of alignment, and we’re going to ask a lot of questions before we move forward.

From the outside, that can feel slow. But from our perspective, it’s about making sure we get it right for our members and that we’re bringing in partners we can rely on.

What’s one piece of advice you’d give a fintech about how to partner with credit unions?

BM: Be thoughtful about how you engage and where you spend your time. Credit unions can take a while to make decisions, so it’s important to make sure you are working with people who have the ability to move something forward. If you’re not getting that signal, it’s OK to pause and come back later rather than overinvesting in a sales cycle that might not go anywhere.

Things like data, cost of acquisition, or even how value is measured can vary, and that can make it harder to tell your story if you’re expecting clean inputs.

The most effective fintechs adjust to that and speak to a few different perspectives at the same time. You’re usually addressing three mindsets: a finance lens around value and return, a member experience lens around how this improves service, and a technology lens around how it integrates and operates. Connecting across all three increases traction.

SD: Do your homework and take the time to understand your audience. That means learning how credit unions operate, including the regulatory environment, and being clear on how your product fits within those expectations.

When fintechs come in with that foundation, it makes the conversation much more productive and builds trust early on. It shows you’re serious about partnership, not just about making a sale.