Financial Technology- or Fintech- is one of the most exciting areas in both the technology and investment worlds. Fintech subsumes a set of sub-areas, each of which in its own right is larded with potential.
I have been lucky enough to be involved with Fintech for about ten years, as a marketer, advisor, and even a small-time investor. The landscape changed massively in the last five years with the advent of AI and, of course, of mature, sophisticated data solutions. I see 3 big trends to capitalize on in the next 5 years- AssetTech, PropTech, and PaymentTech.
A quick dive into each:
· AssetTech- World-wide there are tens of trillions of dollars under management by firms that aim to optimize investments on behalf of their clients or on their own account. Ingesting all the available data, contextualizing it, and making decisions on it is the “silver bullet” in this space. The ideas are not hard, but the execution is. Data siloes persist and decision-making is retarded by the lack of really integrated platforms for AssetTech. Well, not for long. Pulak Sinha, CEO of OnPepper, put it like this- “AssetTech is here. It will “eat the world” for Asset Managers whose native smarts are not met in kind by their current systems.”
· PropTech— Residential Real Estate is the world’s largest asset class. When you add Commercial Real Estate into the mix, one is reminded of the joke “Real Estate is ‘Where’s it’s at’.” Still, the entire transaction ecosystem for Real Estate is opaque and imperfect; enter AI into this equation coupled with trends to democratization and transparency and you get a perfect storm for disruption and enhancement. As Clement Ifrim, CEO of Quantarium, told me, “Proptech and Real Estate Tech were the natural choice for us as an AI company. What industry better represents the possibilities of AI while ensuring that families’ largest economic investment is under stewardship?”
· PaymentTech- Ultimately, transactions and payments are the lubricant for the world economy. Still, the monopolistic control of very few institutions and the role of large financial and payments institutions as “necessary evils” hamstring innovation. Again, not for long. As product designer and industry executive Jayant Ramchandani suggests, “In payments, the emerging technologies coupled with business design wins can herald a world in which all players in payments, expense management, and transactions can be aligned and harmonized. PaymentTech is huge now and is only going to grow.”
Industry leaders and investors are flocking to Fintech opportunities. A recent study by CBI Insights took note of the incredible number of 100M+ fundings in Fintech.
Originak Article by: Romi Mahajan, CMRO, Quantarium
Image by: Austin Distel