Four of Europe’s largest banks reveal their Fintech scouting strategies
To an Entrepreneur attention is oxygen so imagine the electricity that flows through a room when you put thirty budding European Fintech Entrepreneurs in the same room as senior executives from some of the Europe’s largest banks. This was the scene at the Finextra Future of Finance 2016 event held in London’s Canary Wharf this week but for all the bravado and chit chat there was one question on every Fintech’s lips – “How do I get my Fintech adopted by or noticed by a bank?”. Of course why rely on someone actually asking this question when you can have a twenty by ten foot Twitter wall ask a panel of industry executives from Banco Santander , Intesa Sanpaolo, Lloyds Banking Group and RBS for you?
With all but one exception the answers that came back, ostensibly, was what many a cold caller has heard many times before – “Don’t call us, we’ll call you”. Now, I don’t know about all of you but I’m still waiting for my call from the Barclays CEO asking me to come in to help him create the next Apple and as the years drag on I’m beginning to get sceptical that he’s actually going to call at all. Maybe he lost my number?
Find your Oxygen
So, if you’re an eager Fintech Entrepreneur and let’s face it nowadays who isn’t then how do you get the audience you crave? Well the good news is that if Santander is your perfect partner then simply E-Mail Mariano Belinky, the Managing Director of Santander InnoVentures and he and his team will see if you pique their interest, ask you twenty questions and maybe give you an audience.
If you want an audience with the other executives though then you’ll need to get their teams attention and in many respects they behave in the same way as traditional Sports Scouts looking for people who are creating noise and a buzz in the industry. Their teams have pre-prepared briefs, mapped against Emerging Technology and Societal trends and they’ll scour social media, Private Equity firms, Venture Capitalist companies and regional Fintech Innovation Accelerator communities like Innovate Finance, Finextra, FinTech50, Startupbootcamp and TechStars to find their new match but it doesn’t stop there, they’re not averse to flying young Fintechs into the UK en masse to take part in speed dating events. For most hardy Entrepreneurs none of this should come as much of a surprise and the general message I’d push out would be make a noise, be seen, be heard, have a voice, network network network.
Check your Mirrors
But wait up but are the banks and other industries that scout in this way actually in danger of missing out on valuable new innovative solutions and products? That depends on what they’re trying to achieve. If their goal is to discover new interesting incremental innovations that will compliment their existing businesses then this approach could be considered sensible but if their objective is to either avoid being disrupted, or to disrupt then it’s unlikely that it will ever produce the results they crave. Innovation is undeniably the corporate buzzword of the 21st Century but most organisations are guilty of only looking within their own industry, or at best “along industry lines” for inspiration.
Over the past five years though almost every one of the new 174 disruptive Unicorns who’ve collectively created new markets worth over $1.5 Trillion originated from outside of the industry they eventually ended up disintermediating and leading. Being disrupted by its very definition means that you either saw it coming and didn’t do anything about it or as is more likely you never saw it coming, in short it came from your blind spot and for many organisations alternative industries are their blind spot.
When Nikon and Cannon were reviewing the market for new competitive threats do you think they investigated the mobile phone companies? When Accor and Hilton were reviewing the market do you think they investigated the rental market? When the Taxi operators were reviewing the market do you think they investigated the ride sharing community in Los Angeles?
Today Bitcoin, or more specifically Blockchain is one of, if not the most hotly discussed Financial Services technologies in town but now industrial giants like GE, Siemens and Samsung among others are looking into how it could be adopted to underpin the $16 Trillion Internet of Everything market so ask yourself this question: Given the banking communities current scouting techniques do you think they’d have spotted the potential or significance of this new technology if it had started in the Industrial sector instead?
Entrepreneurs shouldn’t automatically limit themselves to only trying to sell their new products or services to a single industry and there are many examples where the founders who thought their future rested with one market have pivoted to target another but if you are able to target other industries make sure you have a grasp of their language and culture and that you tailor your approach.
As for the more established organisations disruption comes from your blind spot and today, depending on your objectives, it’s not enough to constrain yourself to looking for innovation along strict industry lines. Spread your net, broaden your horizons and be open to new approaches.