Greg Palmer, VP of Finovate gives his thoughts on the state of the fintech industry
As we approach the end of 2019, it’s worth noting how much progress the fintech industry has made this year. We’ve seen major gains in customer experience, wealth management, financial inclusion, and many more. What’s been most striking to me, though, isn’t the progress that’s been made in any one area; it’s the way that this progress has come about.
Several years ago, there were a lot of small, early-stage fintech startups that were working on creative solutions to challenges within the financial industry. As some of those startups started to scale up, VC funding going into fintech began to concentrate around a smaller number of companies. There’s nothing wrong with putting financial muscle behind companies with good initial traction, but problems can arise when VC’s focus too much on established companies, and don’t engage with early-stage companies.
Through our 2019 shows, we’ve seen a greater number of seed stage and early-stage companies, and the shows have been stronger for it. While established fintechs are in a position to bring technology into the real world, a healthy ecosystem of new, young companies is vital to make sure that the industry doesn’t rest. Small companies bring creativity, energy, and a hunger to the table that pushes more established parts of the industry to be better.
It’s this hunger and creativity that is bringing personal finance back to relevance – existing tools that offer monthly budgeting are not enough, consumers need guidance around the biggest financial decisions of their lives. It’s this hunger and creativity that’s pushing financial inclusion forward – using tools like AI and big data to identify creditworthy individuals who are currently excluded. And it’s this hunger and creativity that’s reshaping online customer interactions with their banks.
It’s been exciting to watch the huge strides that fintech has been making, but it’s more exciting to see those strides coming from young companies challenging the status quo. In this issue, you’ll read about the established leaders and early-stage startups who are pushing fintech forward and revolutionizing the customer experience. At Finovate, we’ve always believed that innovation can come from anywhere, and it’s great to see that thesis being proven in practice.
Happy reading, and as always, keep innovating!
Greg