enterprise ireland north american fintech advisory panel remarks scott wilkinson
TRANSCRIPT
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”
