Defining Tomorrow: Partnering to Navigate Fintech’s Unknown


Disrupting Tomorrow panel at Baruch - Interbrand - Meghann Fraser 2016

Interbrand Senior Director of Strategy Meghann Fraser shares insights from moderating the “Building Partnerships to Navigate the Unknown” panel at the recent “Defining Tomorrow: Lessons in Disruption” fintech conference in New York

With the highly competitive and regulatory nature of the financial services industry, it can be extraordinarily challenging for fintech startups to both uncover and scale opportunities. As a result, critical partnerships are beginning to emerge within the financial services ecosystem, with a goal of growth for all parties involved.

It’s important to look at just where and how these relationships are forming because it’s not just about big banks and tech startups. During “Defining Tomorrow: Lessons in Disruption,” a summit hosted at the City University of New York’s Baruch College by Interbrand, Ready Set Rocket and the New York Stock Exchange, a diverse group of panelists discussed the role that cross-sector partnerships will play in advancing fintech, and what emerging brands can learn from the leaders and pioneers.

Some of the key themes that emerged from the panelists’ discussion around the power of partnership:

Beyond transactional: Expanding partnership outcomes
While many fintech partnerships have been forged on the premise of accelerating bottom-line growth for both parties, partners are now starting to see added benefits. Conventionally, fintech startups approach partnerships when looking for access to new customers and distribution channels, while traditional financial services institutions look for the opportunity to better serve their existing customer bases and block competitors from gaining potentially game-changing technology.

Today, financial services institutions are beginning to see the brand-building benefits of their fintech partnerships. By launching more innovative products and services and finding opportunities to more deeply engage their customer bases, banks are being seen as more progressive and attuned to user needs.

This shift in perception is not isolated to the outside world. Within financial services institutions, employees are benefiting from learning new ways of working at an increased pace and developing more agile and nimble ways of working than those historically practiced.

Marika Vilen - Thomson Reuters

Marika Vilen (above, middle), Global Head of Alliances at Thomson Reuters, spoke about the impact and importance of fintech startups for her organization: “I think fintechs help us think differently and more broadly. When we work with fintechs, their ability to attract new talent and build nimble technology is what we all benefit from. We allow them access to our resources, and in return we leverage their capabilities to keep our audience engaged.”

Amplifying opportunity as a collective: The fintech hub
Until recently, the fintech industry grew in a relatively disjointed fashion. With intense competition, evolving business models and the rapid pace of growth in the sector, governments around the world have now stepped in to support and foster collaboration by developing regional fintech hubs including London and Singapore. These innovation centers bring together startups and established brands in the financial services sector, and academic institutions encourage knowledge sharing, enhance technological advancements, and attract investment.

New global consortiums are also starting to emerge to enhance collaboration and engagement across regions, while providing opportunities for fintech companies to gain access to new markets and customer segments. “The role of tech hubs is to create an ecosystem that fosters startups,” said Alexandra Tynion (bel0w), Head of Growth at SeedInvest, who sees these hubs as crucial to industry’s future.

Alexandra Tinion - SeedInvest

Accelerating the pace of growth: The evolving role of academia
Academia is also playing a foundational role in the development of the fintech sector. As key participants in regional fintech hubs, academic institutions are producing the talent that will spawn the next generation of fintech entrepreneurs and the brains that will support the growth of existing startups.

Academic research is also expanding capabilities in data analytics, cybersecurity and fraud protection, with new findings being shared and spread through practitioner journals. More and more partnerships are emerging between academia and financial services companies to accelerate the commercialization of research, which is key to the overall advancement of the fintech sector.

Mahima Hada - Baruch College professor

Baruch College professor Mahima Hada (above) noted that academic institutions must work with governments to ensure regulations evolve with the pace of innovation. “We aren’t seen with that kind of distrust from, say, the SEC, and we already have these innovation hubs where startups work,” said Hada, citing Penn State’s efforts to bring the work of its own financial risk assessment to Washington. “I think universities here do have a role to play, and I think we need to be more proactive on that.”

The next frontier: Regtech
Beyond being slow moving, the complexity of the regulatory environment within financial services has been a barrier to growth. Consequently, the regtech field—using agile technologies such as artificial intelligence and biometrics to help banks comply with regulatory roles—has evolved quickly to support the growth of its sister sector.

Regtech companies are seeking to define and streamline regulatory standards and processes for advancements in the industry—accelerating the speed at which the fintech sector can perform and grow. In the shorter term, regtech is helping to automate the mundane aspects of regulatory compliance while also serving to manage risk in a more agile fashion.

Aaron Narva, Exiger

While much of regtech’s focus is customer-facing, the business-to-business opportunities are significant. Aaron Narva, Director and Global Head of the fintech company Exiger (above), talked about how emerging startups that address niche aspects of the compliance process are opening up collaborative opportunities, even among traditional competitors.

“In an old world, Exiger and TR (Thomson Reuters) would have been considered in the same space,” he said. “Whereas we provide a new way to look at the information TR has at its disposal. I think this fintech/regtech ecosystem is an interesting place for partnerships.”

The world is ready for the future of fintech. As our diverse group of panelists demonstrate, it’s not just tech entrepreneurs who are excited about opportunities—institutions, cross-sector businesses, academics, and, of course, customers are all pushing the sector forward.

As Josh Feldmeth, Interbrand CEO North America, noted in his closing remarks, this mutual excitement about new technological developments points to a deep truth about business strategy that comes down customer experience.

“It’s about identifying small pain points and removing them—what all the big companies would do if they didn’t have the legacy,” he said. Working together helps everyone cover ground more quickly and deliver experiences more seamless—proving a win-win for all those involved.

Read more from the “Disrupting Tomorrow” conference:

Meghann Fraser and Nick Pinto (Interbrand): Future of Fintech: Creative Collaboration or All-Out Revolution?

Alex Lirtsman (Ready Set Rocket): Leveraging Digital Disruption in Financial Services

Ana Valenzuela (Baruch): Fintech Finds Opportunity in Unmet Customers’ Needs

brandchannel Q&A:  Loans With Heart: 5 Questions With CommonBond CMO Phil DeGisi