By David Dean
Head of M&A
Evergreen Financial Technology Group
I was recently speaking with a fintech founder about why my team at Evergreen Financial Technology Group (EFTG) is so emphatic about a philosophy we call extreme decentralization. As we talked, it occurred to me that we could do a better job of publicly articulating what decentralization really means and why we believe it matters so deeply, particularly for CUSOs and fintech businesses serving credit unions.
What Is Decentralization?
In a decentralized operating model, most decisions are made by operating companies rather than by corporate headquarters. A highly decentralized organization is characterized by dozens—or even hundreds—of separate offices and brands, empowered CEOs who manage their own profit and loss statements (P&Ls), and a razor-thin corporate team. Most decisions that affect employees or customers are made at the operating company level, without corporate involvement.
A centralized company, by contrast, is defined by a robust corporate team with highly empowered functional leaders. Local offices operate at the direction of corporate, following strict brand guidelines and standard operating procedures. Decisions that fall outside those procedures typically require approval from headquarters.
EFTG’s Operating Model
EFTG’s model is simple. We are on a mission to be the best home for mission critical fintech businesses and their leaders. To achieve that mission, we are deeply committed to two things: creating a permanent home for these businesses that’s optimized for long term, sustainable success and empowering leaders through a decentralized operating model.
For founders and business owners, this means EFTG aims to be the best acquisition partner to care for your employees, customers, and brand; especially important in CUSOs, where trust and continuity matter deeply to credit unions and their members.
For leaders, it means EFTG is a partner in your entrepreneurial operating experience. We offer a level of empowerment that’s difficult to find in traditional corporate or private equity environments, alongside a business system designed to drive market-leading growth.
Extreme decentralization is central to our value proposition. It enables us to preserve the soul of the companies we acquire while empowering leaders to fully live into their potential as entrepreneurs.
The Advantages of Decentralization
We believe decentralization leads to higher growth and stronger long-term returns on capital for several reasons:
- The best people want to be empowered.
The most talented operating leaders want to be entrepreneurial CEOs with meaningful decision-making authority and aligned incentives—not branch managers executing someone else’s plan. Our view is simple: the best and most energized teams win, and those teams thrive in empowered environments.
- It’s easier to grow smaller P&Ls.
Growing a $5 million business by 20% requires adding $1 million in revenue. Growing a $100 million business by 20% requires adding $20 million. Percentage growth rates naturally decelerate as companies scale. Our solution is to keep P&Ls as small as practical and growth rates as high as possible.
- Business owners prefer decentralization.
Founders generally prefer selling to acquirers who retain their brand and provide continuity for employees and customers. While we continuously improve the businesses we acquire, we don’t disrupt them the way centralized acquirers often do. In fact, every business owner who has partnered with EFTG cites our decentralized model as a key factor in their decision.
- Accountability is crystal clear.
In a decentralized structure, each operating CEO has a straightforward scorecard: their P&L and KPIs. If growth stalls or margins slip, responsibility is clear. Decentralization doesn’t mean unconditional empowerment. Empowerment is earned through performance and can be lost when results falter. Centralized organizations often suffer from murky accountability, where functional leaders blame local teams and local teams point back to corporate.
- Bureaucracy is minimized, margins are maximized.
Large corporate teams inevitably introduce bureaucracy: approval processes, reporting requirements, meetings, mandates, and policies. As corporate structures grow, coordination costs and organizational friction rise, slowing operating companies and dragging on margins. Leading decentralized organizations often operate at significantly higher margins than centralized peers, even though they duplicate certain roles locally. Simply put, bureaucracy is more expensive than local autonomy.
Decentralization as a Catalyst for Innovation
When people think about disruptive innovation, they often picture a small startup working out of a garage, not a large organization with hundreds of employees.
That intuition is right.
Innovation thrives in environments that reward speed, ownership, and experimentation. It struggles in bureaucratic structures where ideas must climb ladders of approval before they can reach customers.
This is one of the most powerful, and often overlooked, benefits of extreme decentralization.
At EFTG, our operating companies function like independent startups. They move quickly, stay close to customers, and make decisions locally. They are not constrained by centralized product roadmaps or corporate committees.
At the same time, unlike early-stage startups, our companies have already emerged from the garage. They’ve achieved product-market fit. They serve established credit unions and community banks. They’ve built trusted brands, durable customer relationships, and strong internal cultures.
That combination, startup agility paired with real-world scale, creates a uniquely fertile environment for innovation.
Nowhere is that more evident than in how our businesses are approaching artificial intelligence.
Our companies are already embedded deeply in the workflows of credit unions and community banks. They understand operational realities, regulatory expectations, and member experience. Many serve as trusted technology advisors to their customers, helping institutions adopt new tools thoughtfully rather than reactively.
That positions them not just to experiment with AI, but to deploy it responsibly – both internally to improve service delivery and externally to help financial institutions solve real business problems.
In 2025 alone, we saw meaningful progress across our portfolio as teams began using AI to enhance customer support, streamline operations, improve analytics, and accelerate product development. But what excites us most is what comes next.
We believe 2026 will mark a step change.
Not because of a single breakthrough product, but because of the collective impact of dozens of empowered companies innovating in parallel.
In a decentralized model, innovation doesn’t come from one centralized lab. It comes from the edges: from engineers, product managers, customer success teams, and operators who wake up every day thinking about how to better serve their clients. Multiply that by a growing collection of mission aligned businesses, each deeply connected to the credit unions and community banks they serve, and you begin to see the scale of what’s possible.
This is why decentralization matters so much in fintech.
It allows innovation to emerge organically from real customer needs. It preserves accountability. It accelerates learning. And it ensures that new technologies, especially powerful ones like AI, are shaped by practitioners who understand the communities they serve.
For credit unions and CUSOs, this distinction is critical. The future of financial services won’t be built solely by centralized platforms chasing scale. It will be built by trusted partners who combine technical capability with deep industry context and who are empowered to act locally, quickly, and responsibly.
Measuring Decentralization
One way to measure decentralization is by comparing the size of the corporate team to the total number of employees.
Will Thorndike, author of The Outsiders, describes this as the ratio of total employees to corporate employees; a clear indicator of where decisions are being made and how much bureaucracy exists. In centralized organizations, this ratio might be under 25:1. Highly decentralized companies will have a ratio of 100:1 or higher. Hall of fame decentralized companies like Constellation Software and Berkshire Hathaway operate well in excess of 100:1 (Berkshire operates at ~15,000:1).
When Centralization Makes Sense
There are situations where centralization works well:
- Uniform products or services. if a company is selling a small handful of products or services that are uniform in nature, centralization is a better structure. It makes sense that Apple designs iPhones and AirPods at corporate instead of delegating product decisions to its retail stores.
- Winner-take-most markets. in a winner-take-most market like a social network, a credit card network or a ratings agency it makes sense to take maximum advantage of scale by centralizing. These markets also tend to be characterized by a uniform product or service.
- Certain low-cost producers. there are certain low-cost producers that benefit from a centralized structure. Walmart relies on a strong centralized purchasing function, though they empower their local store operators with certain decision rights.
Fintech serving credit unions typically doesn’t fit these categories. Credit unions often depend on customer support, regulatory nuance, high-level security, vertical expertise, and continuity of service. Centralization in this context often leads to employee churn, slower innovation, and weaker client relationships.
What’s at Stake
What’s ultimately at stake is the culture of fintech businesses and the quality of service delivered to credit unions and their members.
A decentralized operating model preserves that culture. It fosters innovation, growth, and continuous improvement. That’s why decentralization sits at the core of EFTG’s mission to be the best home for businesses and their leaders.
We pursue this work with tremendous energy because every company we acquire represents an opportunity to preserve autonomy, empower teams, and support the long-term success of fintech partners serving cooperative financial institutions and their communities.
This article was inspired in part by EFTG board member Jeff Totten’s post, “Why We Believe in Extreme Decentralization.”
To learn more or connect with Evergreen Financial Technology Group, please visit their website at https://evergreenftg.com/.
About the Author:
David Dean
Head of M&A
Evergreen Financial Technology Group
David Dean is a seasoned fintech executive and strategic leader in mergers & acquisitions, specializing in founder-led software businesses serving credit unions and community banks. As Head of M&A at Evergreen Financial Technology Group (EFTG), he leads sourcing, development, and execution of acquisitions that align with EFTG’s long-term, buy-and-hold investment philosophy.
Before joining EFTG, David served as Chief Operating Officer and Chief Investment Officer at CUSG, where he oversaw corporate development, strategic partnerships, and portfolio company growth. His career reflects more than a decade of experience driving sustainable value creation across fintech, SaaS, and media, guided by a disciplined and collaborative investment approach.
A California native and graduate of the University of Missouri-Columbia, David now lives near Detroit, Michigan, with his family.