In the race of adopting #voice #technology in banking Capital One is certainly taking the lead (with not too many competitors on the horizon, to be fair). Microsoft unveiled the #Cortana Skill Kit, a set of tools, which will allow developers to leverage Microsoft bots and create new Cortana implementations, atRead More
Bank Innovation
#Deutsche #Bank AG has hired two new #technology #leaders as the German bank seeks to boost #fintech development.
via Linkedin
Elly Hardwick, the former chief executive of Credit Benchmark, has joined Deutsche Bank’s London office as the new head of innovation, which includes oversight of all Deutsche Bank Labs.
The bank announced plans to open three Deutsche Bank Labs last year in Berlin, Silicon Valley and London. The labs are aimed at helping the organization apply new technologies to enhance its products, services and processes. It will help it innovate and deepening its relationships with #tech startups.
Hardwick will also work with fintech startups and the firm&8217;s business units to drive new technology adoption, the bank said in a statement last week.
Philip Milne, who previously was the CEO and founder of a Silicon Valley virtual reality startup, joined Deutsche Bank&8217;s Palo Alto office in November as chief technology officer for innovation. Milne has been acting as “an interface between the Deutsche Bank Labs and the bank&8217;s wider technology organization.”
Both Hardwick and Milne will report to JP Rangaswami, the chief data offer and head of strategy and innovation for the bank&8217;s chief operating office.
Deutsche Bank has been facing a number of headwinds and its increased focus on fintech is intended to help it shore up its capital position and stabilize its share price, according to the Wall Street Journal. The firm said earlier this month that it plans to cut roughly 3,400 trading clients a part of a broader restructuring designed to cut costs and restore long-term stability.
The Deutsche Bank Labs are part of the bank&8217;s Strategy 2020 under which it plans to spend up to EUR 1 billion on digital initiatives over a period of five years.
Deutsche Bank Digital Factory in Frankfurt, Germany, via DB.com
Alongside the labs, Deutsche Bank has also opened a Digital Factory in Frankfurt where it focuses on developing digital banking products. Around 400 software developers, IT specialists and financial experts from 14 nations were working together in the space as of September 2016. The bank plans to increase headcount to 800 by 2018.
In October, Deutsche Bank partnered with Misys for a five-year enterprise license agreement to deploy Misys FusionBanking Lending and Misys FusionCapital solutions across the business.
Misys’ FusionBanking Lending offering includes the Loan IQ back office platform for syndicated lending and the front-end that originates from Custom Credit Systems, a US-based provider of commercial loan software which Misys acquired in 2014.
The FusionCapital solutions include a number of treasury and capital markets systems acquired by Misys over the years: Opics, Summit, Kondor and Sophis’ Risque.
In September, Deutsche Bank teamed up with startup accelerator Axel Springer Plug and Play in Berlin to back banking and insurtech startups with cash and other support.
Upon completion of the program, which runs during 100 days, Deutsche Bank could decide to invest and partner with the companies. Investment would range between EUR 100,000 and EUR 500,000. The bank seeks to back and partner with roughly six companies by the end of 2017, according to the Financial News.
Matthaeus Sielecki, head of working capital advisory, financial technology, at Deutsche Bank, said in a recent interview that #banks and fintech startups must learn to co-operate to align strengths while addressing shortcomings.
&8220;In a highly regulated market such as financial services, neither type of organization can innovate and scale on its own,&8221; Sielecki said. &8220;Together, they can find the best ways of serving business customers in the digital age – by combining cutting-edge creativity with proven processes and infrastructure.&8221;
The statements echoed an extensive report released earlier this year in which Deutsche Bank calls for more collaboration between financial institutions and the startup community to leverage their respective strengths.
Featured image: Deutsche Bank Twin Towers, Frankfurt, Germany, via Wikimedia.
The post Deutsche Bank Names Two New Tech Leaders In Fintech Push appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
Financial #technology solutions provider D+H has launched Barometer today, a software-as-a-service assessment and training solution for lenders, in partnership with the Royal Bank of Canada, which is one of the largest financial institutions in the country. Both companies are based in Toronto. “Barometer is a #lending #simulation, the first of itsRead More
Bank Innovation
During this week’s #Smart #Contracts Symposium in NYC, 250 attendees—including members of the #blockchain-trading group the Chamber of Digital Commerce—listened as the potential benefits of the #technology were laid out, from securing property titles, to gold ownership. Symposium speakers, presenters, and panelists demonstrated and debated all of the possible useRead More
Bank Innovation
It is this time of #year again where most of us willingly and willfully make fools out of ourselves trying to predict the future of our industry. The momentous electoral events we have witnessed and those coming up in #2017 remind me that, even more so for the next 12 months, #macro #risks will rule and influence the state of financial services and #fintech. I will limit myself to comments pertaining to the US and Europe.
I have already attempted to decipher a Trump presidency in a previous post, see here. Suffice it to say there will be winners and losers in the five sectors of the industry – lending, capital markets, asset management, payments and insurance. Regtech may be impacted the most if the US experiences a wave of deregulation. Although I still ascribe to a secular and long term trend towards regulatory harmonization, we may see deviations at the margin, especially within sectors that are more domestic than international by the nature of their activity. I would not be surprised if US domestic lending regulation, compliance and enforcement be loosened while European consumer protection remain tight for example. Another area where one may see changes at the margin would be domestic payments. Still, when it comes to such sectors as capital markets, cross border payments, interbanking activities I do not expect much deviation from one jurisdiction to another and certainly no loosening up when it comes to clamping down on illegal activities, fraud. Hence cybersecurity, AML/KYC and reg/compliance thereof should be interested ecosystems with plenty of investment and operational activity. On another regulatory note ,2016 was the year of the FCA with it’s sandbox. The FCA&8217;s initiative was so popular we ended with more than 8 regulators launching their copycat initiatives. I will make three #predictions in the sandbox space for 2017. First, regulatory sandboxes will be renamed &8211; sandbox is just a poor name everybody dislikes. Second, the US and the EU will see their own “sandbox” initiatives launched (where in the EU is a mystery) as hybrid collaborative efforts between regulators, technologists and incumbents. Third, there will be more collaboration at the &8220;sandbox&8221; level between regulators. Be that as it may I also expect the FCA to go from strength to strength given its clear leadership and first mover advantage (same for MAS, the Singapore regulator).
I continue to worry about alt-lending or marketplace lending as rising interest rates will benefit #banks first and while there is some room to increase the cost of lending, in a competitive market with regulatory oversight there is a limit to how high the cost of borrowing can go. On the other hand banks cost of capital will not rise as fast as those of alt-lenders. Therefore the next 12 months will prove delicate for this industry. I expect banks flexing their muscles and acquiring some platforms as well as mergers between alt lenders while the weakest competitors close shop. Whether this pattern will evolve in sync across the US and Europe I do not know. It depends on how US, UK and EU yield curves will behave. I certainly expect this pattern to occur in the US. On the other hand, infrastructure spending, if it is on a massive scale in the US, will have a positive impact on lending and fintech lending actors will benefit. One might even see fintech startups funded on the basis of infrastructure services for example.
In the retail asset management sector we have witnessed a wave of consolidation in the US, notably with roboadvisors. Most incumbents have placed their bets and the few remaining independent startups have survived, so far. We have yet to see consolidation in Europe. Arguably, there are fewer roboadvisors in Europe than in the US and most are younger so we might not see full consolidation yet. I would not be surprised if a European incumbent or two makes an acquisition though. I remain interested in roboadvisor models, especially those that will make effective use of ETFs, micro investing or micro saving and build a social layer that enables high engagement. I think there is still space for these types of models. Additionally, there is still much to be done to modernize incumbents and to date few fintech startups with a b2b model have emerged in asset management. Some are due to pop up.
In the payments sector I will go out on a limb and call for the rise of micro payments platforms in 2017, most probably powered by a distributed ledger #technology. Most startups addressing micro payments have failed so far but it is only a matter of time before a startup or an incumbent hits the right note. Given the rise of m2m, p2m transactions with IoT and the continued growth of p2p as well as the explosive growth of other types of activities (esports, different models of media consumption from a la carte to subscription) it is only a matter of time before micro payments make it big. My bet is on both platform plays that provide backbone and infrastructure and front end models. Other than micro payments, I continue to be interested in b2b payments and services to SMEs. We have barely scratched the surface and financial services to SMEs are still antiquated. The prospects of a global trade war will not play well with trade finance and supply chain finance activity though.
As for the #blockchain ecosystem, 2016 was a fascinating year. We now have a pretty good picture of the landscape with up to 10 companies being the potential winners. Most of these winning companies have opted to open sourcing their code, collaborating with standards setting bodies, or working as a consortium with many incumbents. Other than a few financing rounds for some of these leaders, I do not expect much investment activity. Indeed I expect many casualties, acquihires or outright failures for the other weaker competitors. 2017 will be a year of consolidation in the DLT space while the winners go about their deployment business quietly. I expect further standardization efforts to bear their fruit &8211; &8220;yesterday and today&8221; in the capital markets arena, &8220;tomorrow&8221; in the insurance space. Finally I expect the start of the patent wars in the space. Most serious contenders have filed patents &8211; incumbents and startups alike &8211; and it is only a matter of time before some try to enforce these patents. Sooner rather than later is my bet.
In the insurance industry, I expect more of the same, both in terms of level of activity and types of insurtech startups. I also expect emphasis on cyber risk coverage and on climate change given both are top of mind and material risks going forward. Cyber risk coverage is particularly interesting to me, given the rise of IoT and the security risks associated with both hardware and software in the space.
On a more general level, I expect five themes to pick up steam in 2017. First, all the business models we have seen created and funded in fintech over the past 8 years will be revisited with an AI component &8211; be it machine learning, deep learning or other. This is bound to happen as AI is sweeping the business world. If mobile is eating the world, AI is the chef that is orchestrating the menu. Whether in lending, asset management or any other sector, I expect to see much activity in this domain and this includes new fintech startups getting funding, especially in b2b. An inevitable trend towards the cognitive financial services firm. Second, the convergence of software robotics, AI and automation will be applied at scale in what is called robotics process automation for banks and insurance companies alike. This is a pure b2b play for sure and I expect this sector to be a fertile ground investment wise. Third, platforms and ecosystems will continue to take shape as various banks further build their API strategies, their marketplace strategies, or even their bank as a service strategies. Whereas 2016 was the year industry thought leaders spoke about platforms, 2017 will be the creative phase for these types of business models. Some startups are already picking up funding. Expect more over the coming 12 months. One should note that platform business models require standards and interoperability. As such, I expect the beginning of standardization and open source in the field of bank as a platform or bank as a service, in a similar vein to the movement we have seen in the DLT/blockchain space. Fourth, the messaging platforms wars will be in full swing as Facebook, Apple, Google, Microsoft vie for dominance and expand their respective ecosystems. I expect more financial services incumbents to jump on the bandwagon and more startups to build their own apps. The lure of reaching millions of users &8211; customers and potential customers &8211; is strong. To me AI powered chatbots fall in this fourth category as few will be successful on their own and most will want to align with at least one messaging platform. In as much as PFM startups were not particularly successful and neither were account aggregation models, the messaging platform wars with their myriads of skills or applets or bots (voice or text or voice+text) present both an opportunity and a threat to the financial services industry. The threat is well known and lies with being further disintermediated and removed from the end customer. The opportunity is less obvious. Indeed, most fintech startups focused on retail use cases have failed to make any significant traction because either the service did not generate excitement and engagement (simple aggregation of data or accounts), or was too obtuse (too complex) or was too superficial (giving you options to consider) whereas what works usually hits on at least one of three dimensions: enhance an experience, accelerate a process, simplify a process. You can bet that the bots within the messaging platforms that will win the day will enhance, accelerate and simplify. It is up to fintech startups and incumbents to emulate best of breed as they will coexist within the same ecosystems. Else, fintech AI chatbots will fail to impress much like PFM models did before. I should add that the messaging platform wars will be a wedge for GAFA to further encroach in the payments sector. Fifth, 2017 will be the year of digital identities. By that I mean most of the investment activity will be focused on identity business models. Some may consider this field not part of fintech. They will be wrong. there is no identity without trust and vice versa. Further identity and trust impact and influence payment methods and enable or disable currencies. I view digital identities as the corner stone of the future of financial services industry. I expect the investment pace to pick up in the identity space.
A few random thoughts in closing. Should a Trump presidency usher an era of instability and trade wars, we will undoubtedly encounter currency wars. Should the EU further weaken in 2017, currency turbulences will be exacerbated. Should the renminbi further weaken, capital flows leaving China will accelerate. Thusly, it is not inconceivable that cryptocurrencies will benefit, notably #bitcoin, along with its ecosystem. In this macro case figure, and assuming legal and regulatory house sorted out with the SEC, I expect much activity with Initial Coin Offerings in 2017 (ICO).
Finally, I expect subdued venture investment activity in Europe and the US in aggregate, especially in the first year of a new US administration which is still an unknown for many.
This week I attended a talk by Robert Scoble and Shel Israel, the authors of The Fourth Transformation. Their latest book charts the rise of #virtual and #augmented reality (VR & AR), haptic #technology, and the devices that will transform our experience of the world we know, not to mentionRead More
Bank Innovation
With 23 #robo-advisors, Germany is Europe’s most #crowded market when it comes to automated, algorithm-based portfolio management advice services.
According to reports from Techfluence, there are currently some 64 robo-advisors in Europe, with the two predominant markets being Germany and London, with 23 and 13 platforms respectively. The two locations are followed by Zurich and Paris, with four platforms respectively.
In Germany, the rise of robo-advisory has been largely fuelled by incumbents which have been deploying numerous products to serve retail investors. Notably, the launch of VisualVest by Union Investment was one of the first independent moves by one of the established institutions into the robo-advisory field.
Launched as a corporate startup, VisualVest provides a platform offering retail investors access to more than 13,000 investment funds via 14 different portfolios: the so-called VestFolios.
Other examples include Fintego, a service provided by Commerzbank&8217;s subsidiary ebase, as well as comdirect, which started offering automated portfolio advice as well.
As for Deutsche Bank, the financial institution has entered into a cooperation with FinCite to offer its maxblue AnlageFinder. AnlageFinder offers a selection of securities in the respective asset class based on criteria selected by the client, such as rating, product costs and performance.
In the space, Germany&8217;s prominent players include Cashboard, Scalable Capital, Vaamo, and Growney, among others.
Not far from Germany, Swiss bank UBS is set to launch a new online wealth manager in Britain in early 2017. The service, called SmartWealth, will target a younger audience.
UBS is the largest wealth manager in the world, managing US$ 2 trillion in client assets. Initially, UBS SmartWealth will be available to a small number of UK residents.
UBS&8217; Shane Williams, the co-head of UBS SmartWealth, told Business Insider in a recent interview that the decision to launch in the UK was influenced by the relative high affluence of the population, favorable local regulation and the advice gap.
But the firm plans to expand internationally in the future.
“We&8217;ll look at where the best places in the future are to go but we&8217;ve not decided yet. But the design of the platform is there ready to move, whether that&8217;s language or different regulatory requirements,” Williams said.
UBS SmartWealth was created especially for those who don&8217;t meet the £2 million asset minimum of UBS&8217; current wealth management clientele. With £15,000, an investor can sign on to SmartWealth. Similarly to other robo-advisors, the platform culls the investor&8217;s goals, assets and risk threshold before suggesting an investment portfolio.
One of UBS SmartWealth&8217;s unique features is that the platform offers users a choice between an active or a passive investment approach. The active approach scours the globe for investments and strives to outperform the market. This strategy makes changes based upon UBS corporate research that includes economic and other factors. The passive approach employs lower cost UBS index tracker and smart beta funds.
As of the fees, UBS SmartWealth is set to charge 1.7%! of assets under management for the actively managed approach and 1%! for the passive one.
It took a year to build the SmartWealth platform, Williams said. Today, the team is made of 80 people based in London.
&8220;What we tried to do with SmartWealth is to be like a #fintech, to go at that pace but within a large organization,&8221; said Williams. &8220;It&8217;s trying to get the best of both worlds.&8221;
UBS is one of the numerous #banks that are looking to tap into the growing popularity of robo-advisors. In the UK, still, Barclays has recently launched a digital investment product that promises lower fees than historical investment services. Lloyds and Santander UK are also reportedly developing their own robo-advisors.
UBS also formed a strategic alliance with US based Wealth management #technology company Sigfig in May 2016.
The post Germany&8217;s Robo-Advisory Sector Is Getting Crowded appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
  #Traditional #Fintech is so boring – and so profitable. The question is whether these vendors will use some of those profits to transform themselves or let nimble startups with modern #technology and new business models eat their lunch. Two years ago, in December 2014, we took a look atRead More
Bank Innovation
#Fiserv, a leading banking #technology company, has signed on as the headline Diamond #sponsor of #Bank #Innovation 2017. Bank Innovation 2017 is this blog’s annual gathering on ideas and opportunities in #fintech. The sixth annual Bank Innovation will take place March 6-7 in Silicon Valley, at the Glasshouse in SanRead More
Bank Innovation
If your company has been trying to get ahead of the innovation curve and build #blockchain projects or capabilities, you probably believe that there just aren’t that many great blockchain developers out there. You’re wrong. You’re probably looking in the wrong places and or you don’t have a compelling enough value proposition to hire a great blockchain #developer. I’ll share a bit on what i’ve learned in what makes a great blockchain dev, where to find them and ultimately how to attract and hire a great blockchain developer.
1) Knowing what makes a great developer
Do you even know the differentiating factors between a good blockchain developer vs. a great blockchain developer? The first step in hiring this very niche skill is to know how to recognise a great blockchain dev vs. a developer who’s learned some blockchain coding skills. Both are valuable however most companies are just now starting to build a capability and it’s critical that you have great blockchain devs as part of your core team.
Generally speaking great blockchain developers tend to have the following characteristics:
Firstly, they are driven by strong ideological beliefs centered on decentralization. Some go as far to proudly self identify as crypto-anarchists[1] and many have strong ideological beliefs on decentralizing everything from corporations to governments and even whole societies. This is super scary for any corporation.
Secondly they have a deep fundamental understanding and mastery of game theory [2] and economic principles. These understandings and expertise applied to any decentralized #technology is the structural framework that accounts for most of the key blockchain breakthroughs.
They also have a true passion for the technology — it’s something they’ve sought to seek and learn about despite the seemingly embryonic nature of blockchains. Some of the underlying cryptography dates back decades. Many are self taught and many are PhD level and above. Most are deeply entrenched in the world of cryptography. [3]
3) They are intellectually curious by nature.
They are super naturally super curious personalities, they’re undeterred by the ambiguity of no known solutions. This actually excites them. When presented with obstacles they have deep seated self-beliefs that they can find multiple solutions for any set of problems. Being better then the next guy and being respected by their peers is of utmost importance.
You might think that sounds like a very rare kind of person — they are extremely rare in the traditional recruitment circles in which you’re accustomed. However they do exist in large numbers and are likely 10 steps ahead of you and what you want to accomplish in your projects.
4) Where to find great blockchain developers
Once you know what you should be looking for, you need to know where to find great blockchain devs. Generally your traditional modes of identifying, attracting and retaining talent won’t work. Your HR department will likely kill any chance you have in the rare case someone responds to an ad or posting and HR is the first point of contact. Unless of course your HR department is staffed with blockchain experts. Job postings don’t work. Recruiters don’t know where to look.
Generally speaking you won’t find the great candidates through LinkedIn and using Google. Be wary of the “experts” on LinkedIn.
You must engage with them in their own environments. Kind of like a Mutual of Omaha episode of going native.
You’ll find them sharing knowledge on public forums such as Gitter and Reddit. Or they can be discussing ideas at meetups and hackathons and other startup events, both on- and offline. Most times they are working on real world projects through platforms like HackerRank or GitHub. Many participate in podcasts.
When you do come across the right type of developer for you, chances are that they will be undertaking several different projects at the same time. This is how they work, contributing across a variety of missions, trying to achieve several different goals. Quite a few are likely running their own startups. Therefore, they won’t want to drop all their ongoing projects to come work for your company, so you’ll need to engage them in a way that resonates with their core belief systems as well as the needs of your project.
5) Engaging and hiring talent
Great blockchain devs don’t want to join your big company.
With great develpors seemingly being few and far in-between (or at least the ones you connect with), they are in extremely high demand. You’ll have massive competition from companies offering all sorts of work to them so you must ensure your company has the right corporate culture [4] to match the talent you’re seeking.
They want to work on and solve big problems — you’ve got to provide them a challenge that they can’t get elsewhere. To fully engage and motivate them, they need to believe your project is for a greater good, and it aligns with their own principles. Finally, compensation is always a major factor to be considered as these developers know what they are worth. They are expensive and well worth it. One great blockchain dev will outperform 5 good devs every day of the week.
Taking all this into account, your options may well be very limited. You’ll probably have to choose, do you hire full time, outsource to specialist blockchain startups/platforms, or train an internal team? Each of course has its own benefits and pitfalls — full time employees will be much more difficult to find and eventually hire, outsourcing leads to some loss of control on your part, and with very few training resources currently available hiring and paying suitable trainers before training your own devs would be extremely time consuming, costly and still potentially not producing the right quality talents.
Additionally, chances are the developers who are interested in your blockchain projects won’t be geographically located where you are. And they aren’t likely to want to uproot and come to you. This means you’ll have to have remote workers — which is just what these individuals tend to prefer.
Is “acqui-hiring” [5] an option? Well, as mentioned earlier, many devs will be at their own startups or elsewhere working on their own blockchain ideas. As we know, these devs are very principally driven, so simply buying them out will NOT make them want to work for your company. Only if there is a clear strategic link between your own blockchain projects and their motivations, and if they believe your company will allow them to take things further than they could alone, will you find devs open to being acquired. However, with most business goals not currently aligned to the developers’ individual goals, this again is a difficult path to tread.
6) Choosing a path forward.
So what do you do? A lot of times you’re going to need to go down multiple paths that include hiring a firm to develop some of your technology- Distributed Labs led by Dr. Pavel Kravchenko and Cardano-Labo are great places to start for the tech development for short term fill the gap measures. They can also be the long term extension of your dev team. They are that good!
Longer term you should be building a learning and training capability to move your high performing developers to becoming great blockchain devs. B9 Labs and Byte Academy are good places to start as external sources of learning and development.
As an aside there are quite a few more yet to be launched global training programs that we’ve seen that are poised to be amazing sources for you.
Conclusion
Make no mistake about it, finding and hiring great blockchain developers is not simple but it can be done.
Firstly become an expert yourself in the technology, understand appreciate the underlying belief systems and the cultures associated with decentralized technologists and you’ll be much farther along than your competitors.
Go to where the great blockchain devs hang out. Where they share, where they learn and contribute. Build a reputation for yourself in the ecosystem.
Engaging startups and developers in your specific ecosystem is critical. Join and contribute to local blockchain related Meetups. We run Blockchain Startups across most major innovation ecosystems around the world. There are many others. Join and Contribute!
Create a culture on your team/company that will support hard charging, highly intelligent, principled people that want to change the world.
Lastly, be open to creative solutions to engaging with some of the most in-demand talent on the planet.
Zach Piester is the Co-founder, and Partner of Intrepid Ventures. Intrepid Ventures invests in, designs, builds and scales blockchain powered companies.
Zach focuses on helping Fortune 500 companies leverage the innovation of startup disruptors in blockchain, #fintech, distributed ledger, & emerging technologies. Bringing together strategic, creative, & technical skills to help industry leaders understand how innovation, digital capabilities, & organizational design can help transform and sustain their positions at the forefront of their industries.
I’m always interested in meeting leaders who are creating transformational products and solutions, so please feel free to contact me by email at zach at intrepid dot ventures.
[1] https://en.wikipedia.org/wiki/Crypto-anarchism
[3] http://news.mit.edu/2014/cryptographic-schemes-security-guarantees-1030
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