Published: 6th March 2018

Confessions of a FinTech Innovator #4

Anyone who has built a business knows that success demands focus, a ruthless discipline to hire great people, win customers, and scale.

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Fin VS Tech

Anyone who has built a business knows that success demands focus, a ruthless discipline to hire great people, win customers, and scale. The best will be smart, optimise capital, play the long game.

Only the fickle and feckless rush to funding sources, the un-investable to ICO. Yet this is what the Banks recognise as success. They’ll make sure they’ve got a pop-up stand at the start-up conference. They’ll hang on to Eric Schmidt’s every last word. Along with the glitterati of the start-up scene, they’ll knock back champagne and canapes like they are going out of fashion.

Meanwhile, the true champions of entrepreneurship will be working on the next code release with maybe only stale pizza and flat beer to keep them going.

In the battleground between Fin and Tech, there is perhaps one glimmer of hope that the Banks might triumph. With all their hubris, technology companies believe that popularity equals success, and in their myopic pursuit of user numbers, sign-ups, ‘likes’ and shares – they focus on data to the cost of longevity. But they are slowly being exposed.

Google have come to dominate the email market through anti-competitive practice and by abusing the trust of their user base. Finally, in 2017 they agreed to not mine users’ email data – but the damage to the market had been done. It’s easy to come clean once you dominate the market (Gmail has 21% market share, but because email is a multi-platform tool, Google servers will see over 90% of the world’s email traffic).

Uber blatantly ignored licence requirements (while licensors were asleep at the wheel) in many of the cities in which they operated, creating an unfair advantage and putting many small mini cab firms out of business.

Facebook’s litany of ethical breaches could fill a book (in fact, it has: see Chaos Monkeys by Antonio Garcia Martinez).

Banks have largely cleaned up since the Financial Crisis. Risk Management is a discipline that extends far beyond the compliance department. The culture is wildly improved from its Wolf of Wall Street heyday. And so, given this – if Banks can just find ways of attracting more entrepreneurs to join the ranks, maybe the blending of culture will be enough to tip the balance in their favour. If they can see that the battleground between them and the tech companies is largely around who will be most responsible with technology, maybe they can win.

They need to start with Digital Ethics. They need to develop Codes of Conduct for technology, particularly AI and Automation. They need to have honest conversations with their staff, shareholders and society about how technology will remake their businesses. But if they can do all that, then they will justly deserve their survival.

And if they can’t? Well, Stuart Gulliver’s prediction that Banks will simply shop from the best of the FinTech market will be reversed. It’ll be Google, Apple, Facebook and Amazon who will be shopping for Banking licences. And if that happens, let’s just hope we’ll hold them to account better than we have our Banks


If you would like to find out how True is helping break inertia in the banking sector, please get in touch with Sam.

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