enterprise ireland north american fintech advisory panel remarks scott wilkinson

What does FinTech Mean to Us?

View Points from a 1st Gen Canadian FintechEnterprise Ireland North American FinTech Advisory Panel – June 21, 2016

Building on Other Presenters

• Think Bigger!

• Next wave is Artificial Intelligence

• Key is rethinking business … technology is a tool for that

What does Fintech Mean?

Incumbent

DisruptorCustomer

Depends on your POV

• 200 person private software company• Based in Toronto, Canada• Founded 1998• Focused on Canadian wealth

management solutions, primarily for large banks– Brokerage– Retail banking, core deposits– Registered accounts– Trust

• Value proposition tied to quality execution, scalabilty, open integration

Our POV?

• FinTech is an Evolutionary Step … Fuelling existing fires of change

• But unlike previous steps … FinTech is global, consumer, and more than banking

• Canadian Banks are Serious … but frictions remain

FinTech = Evolution

“FinTech” Evolution

Dot-Com

TechFin

FinTechAI

Cons

umer

Impa

ct

Device and Technology Readiness

• Efficiencies• Service• Revenue

1990’s 2025

Operating Costs

ExperienceForces of Disruption

Globalization

Regional Regulatory

Inertia

IncumbencyPower

Access to Capital & Shareholder Return

Capacity of Consumers to Adjust Stakeholders Interest /

National Agenda

“Next Big Thing” Bandwagon Effect

Results Culture Still Dominates

Fuelling Existing Fires of Change

$34 Trillion Net Canadian

Assets

$8.3 Trillion

Net Canadian

Worth

$4.9 tn Bank

Assets

$1.4 tn Broker/DealerAUM

$1.1 tn FUNDSAUM

$1.3 tn LifeCo Assets

$3.2 tn Pension

Sources: Statistics Canada December 2015IIROC September 2015IFIC October 2015OSFI Q3 2015

$0.04 tn

Hedge Fund

Canadian Wealth Assets

>$19bn spent on financial IT salaries and related costs annually

Trends in

Wealth

Legacy Technology Friction and

ReplacementRegulation and

Business Model

New Investor Models/

Competitors

Globalization and

Consolidation

Changing Product

Shelf and Service Offers

Demographics and Wealth

Transference

Knowledge Gap with

New Managers

Big Data and

Analytics

Agile & Digital

Economics

Key trends for Canadian Wealth Management companies:

Changing Business Model and Competitive Framework

Changing Technology and Project Frameworks

Changing People Interactions

Sources: Deloitte, Aite, PwC 2015

Fintech = Global, Consumer & more than (Banking), (Robo),

(Payments),….

3 Basic FinTech Strategies1) Inflection Point

2) Operating Systems

3) Customer Ownership

Own customer at point of purchase decisions to match provider

Change value chain to enable lower costs, change established capital

Controlling customer on ongoing basis

Amara’s Law

•??

•Payments/Current•Money Transfers•Direct Lending•Merchant/Acquirer•Factoring

•Virtual/Direct Lloyds•Virtual advisors•Comparisons

•Robo Advisors•Hybrid-Advisors•Direct markets•Block Chain

Wealth and Investments P&C

Life Insurance

and Pensions

Banking

Short term impacts of technology over estimated … long term impact underestimated

Same Problems … Different Takes

TechFin

Institutional

Modernization

FinTech

Consumer

Disruption of Existing Models

AI

Pervasive

Ubiquitous

Choice, Experience, Frictionless Transactions

Not this type of AI!

OK, Maybe this…

Artificial Intelligence??

What is the impact of 50 bn devices linked together??

Banks are Serious about Fintech … making direct bets … but peripheral to $19 bn

annual spend

Incumbents Choices To React?

Comb Over

Strategy

Marry Younger

Accept Who We

are

Be a Better Version of Ourselves

Bets Are Being Placed…

• Available bets, Changing the Odds:– Inside Bets

• Active FinTechs• Intra/Entrepreneurs• VC

– Outside Bets• Local Accelerators• Business Schools• Global Scanning

Resources # Bets

What is the Game Again?

Between 2012 – 2015 there were Investments of C$1.4 billion for $600 million revenues in Canadian FinTech Sector

Enterprise Ireland Implications

• Canada is Still Conservative … – Lip service, consensus, following crowd

• Appetite exists, but scalability an issue– Partnerships, affiliations, alliances

• Be more aggressive with Business and Technology Vision– “Solve the Biggest Problems”

Thank You!!swilkinson@rpmtec.com

www.linkedin.com/in/scottpwilkinson