Ireland has transformed itself into a leading global provider of financial services Its main businesses are aircraft leasing, private equity, real estate and debt.
What are the most disruptive financial technology startups?
I am not an experienced guy in the world of Finance or FinTech but i don’t believe any startup will be truly disruptive to the incumbents because of myriad no of reasons. But 3 startups caught my eye because these startups would make certain technologies available to the masses and bring them out of bastions of big institutions
1.) Kensho Finance: This startup is going to open Quantitative Analysis and Financial Modelling Techniques to the general public. Now anyone with an understanding of Finance can model and backtest on historic data. This firm will reduce the dependence of people with non-quantitative background on quants. It will also reduce the need for Institutions to build massive computing infrastructure since this firm would host data and software on the cloud. It would also allow people to create and test optimal investing strategies. The founders are also planning to create ML algorithms which would allow us to front-test our strategies. They have created a Siri-like software called Warren.
I don’t feel that this startup will allow the very heavy financial modelling to become accessible. But it would certainly reduce a good amount of quantitative advantage available to a handful of firms like BridgeWater Associates or Renaissance Technologies.
It has also received a great amount of Press.
2.) FutureAdvisor: These firms are planning to build robotic style financial advisory services which would advise people on the various investing/saving options available to them. It would allow people to key in their finances, their objectives, their present investment accounts and then provide personalised solutions to them. It would suggest ETF’s, Mutual Funds policies to invest in. They would not disrupt private banking services/finacial advisory services that people with high incomes are able to afford but would certainly make personalised Finance advisory available to general public. It would also help Private Bankers to do their jobs better. The software they are building would be like Digital Assistants to general public.
Here is the coverage in the press.
Another Company in the same space is PersonalCapital which combines digital advisory services with the expertise of a financial advisor because when it comes to Finances, people do prefer talking to a real human than just rely on a computer.
3.) Coin: People who start reading about this startup exclaim,”Oh please!, Not another Payment Processing Company”. Sure many startups have opened up in this space and some carry very high-minded ambitions of disrupting Visa, MasterCard or AMEX (which i believe won’t happen). But Coin isn’t that. What Coin does is it uses a single device to bring all your cards on one platform. It has a magnetic stripe reader which can read the details of your credit, debit, shopping cards etc. and store them on one card which can also be accessed via your mobile phone. This would not disrupt the traditional companies but just reduce the number of cards people carry in their wallets.
See this video to understand more about Coin.