Asset Management Breakfast - 4th June 2015

Meeting the Fintech Challenge

Asset Managers Breakfast Briefing4 June 2015

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Work &Technology

Disruption

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Rise of the Robot

BBC Newshttp://goo.gl/s5h7JB

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Rise of the Robot

Huffington Posthttp://goo.gl/OAP2oA

$16bn in Assets from Robot Advisors like Betterment, Wealthfront, LearnVest

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47% jobs at riskover perhaps a decade or two

Frey and Osborne, 2013

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New Jobs10 Jobs that didn’t exist 10 years ago

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New Jobs

Mandel & Liebenau, London: Digital City on the Risehttp://goo.gl/a1gzVm

44,000 working in Fintech in London

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CB Insightshttps://goo.gl/Ce9Z3I

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BusinessDisruption

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RegulationWhile financial services was once dominated by

several large banks that maintained a stranglehold

over consumers' options, the sector is now seeing

enormous growth in online lending with many

small and agile financial technology companies

establishing themselves as serious competitors.

“

CNBChttp://goo.gl/kp0qee

promoting change

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RegulationWhen this happened to airlines:

50% cost decrease in air fares

promoting change

CNBChttp://goo.gl/kp0qee

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Plus Success is Less Permanent

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155

Average number of years a company spends in the S&P500 index

1937 2011 2025KPMG Projection

KPMG Global Megatrends

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Plus CustomersLess Tolerant

Santander 8-10 days to deliver a

replacement card

Frustrated Customer3 days to cross-stitch and

post ‘card’ to Santander

BBC Newshttp://goo.gl/c14GZJ

CNBChttp://goo.gl/kp0qee

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So Lots of New Competition

fintechinnovators.com

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New competition with backing

$20bn VC investment in Fintech in 2015 Huffington Posthttp://goo.gl/TX0JYy

$1bn in UK and Ireland alone in 2014Accenture, cited by CNBChttp://goo.gl/WbgGIW

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Fighting BackYou can respond with various

business tactics and by deciding

to exploit digital

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Exploit DigitalWorld-wide

(A struggle with national regulation)

Disintermediation

Cut out the middle man (or robotise them)

Consolidation

Acquire and integrate

the condensed version!

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Exploit DigitalFree (or nearly free)

What real value do you offer, what can be free?

Me-wide

How can you be customer-centric, not product-centric?

Holding on to Weak Links

Why is personal finance “personal” – couples, families?

the condensed version!

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Exploit DigitalCreation

Do you do the best?

Curation

Do you bring the best together?

Aggregation

Do you bring everything together?

the condensed version!

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Exploit DigitalRich Niches

Dominate niches with targeted offerings

Quantified Self – Phygital

Your “Money Beat”, moment by moment

Experience-led

It’s not a product/service, its about prosperity

(sorry)

the condensed version!

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5 Lock-insUsability – one click

Eco-system – everything works together

Subscription – free(ish) entry, paid continuation

History – keep all the records and contacts

Network effect – everyone else is here

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Incubate (integration challenge)

“Unicorn Club” $1bn valuation Lending Club, Square, Credit Karma, Stripe, RenRenDai

$100m Investor ClubSberbank, BBVA, Santander, HSBC

BizJournalshttp://goo.gl/dvyqoF

Informilohttp://goo.gl/kCB7ty

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Acquire(integration challenge)

Activity in Mergers and Acquisitions

Sponsored Lists like FinTech50

Events like Fintech Innovation Lab is

an accelerator programme to introduce

Fintech to large financial services, by

Accenture

CNBChttp://goo.gl/ohv6Og

Accenturehttp://goo.gl/adBKdS

FinTechCityhttp://goo.gl/M1zvPv

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SimplifyIdeally remove complexity

If you can’t, then develop intelligent

interfaces that hide the complexity

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SimplifyGovernment

processes are full of

complexity, special

rules and edge-cases

Gov.ukhttps://goo.gl/WlQjjv

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Fintech Challenge1. You are being disrupted

by automation and business changes

2. You can fight back

by exploiting digital, acquisitions & simplifying

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and finally…The challenge of Fintech might not really

be about the Tech.

The challenge might be about the brand:

new, fresh, untainted

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