Tag: Big Data

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Focused on Financial Analytics

When it comes to tapping the creativity and ingenuity of the financial technology sector, I think this equation says it best.

For me, the term “big data” jumped the shark a few years ago.  Much like investment bankers shelved their  “wave of consolidation” pitch, I remain hopeful that the clichéd data term gives way to something more appropriate, descriptive and dare I say agile?  Nonetheless, the concept of sifting through massive amounts of structured and unstructured information to identify meaningful insights is nothing to scoff at.  Truth-be-told, it has interested me since my time at Computech, a leader in agile and lean application software development and IT operations & maintenance that was recently acquired by NCI.

Figuring out discrete patterns to better prepare for the future is huge business — and I continue to see the largest financial institutions in the U.S. making investments in financial analytics.  I was reminded of this drive to leverage new technologies while re-reading my notes from a Q&A session I had with BNY Mellon’s head of Strategy and Innovation last September at our FinTech day at NASDAQ.  There, I made note of three companies — Kensho, Discern and ClearStory — that had the potential to transform part of the financial sector.  FinTech Focused.001With said notes in hand, I dove a deeper into each company’s background and offerings, finding all three bring interesting new models and technologies to bear on automating and enhancing the investment research process.  So as I’ve done with past posts (Three FinTech Companies I’m Keen On and Spotlight on FinTech), let me share a little about each one:

  • Kensho is pioneering “real-time statistical computing systems and scalable analytics architectures — the next-generation of improvements to the global financial system.”  Backed by Goldman Sachs and Google Ventures, and with clients that range from Wall Street’s global banks to several of the best performing hedge funds, think of the 2013 startup as a “Siri-style service for investors, analysts and traders” (h/t to the FT for the comparison).
  • In the interest of fair disclosure, all three of my siblings have worked for investment management firms, so they may buckle at Discern’s description of “conventional” investment research relying “on solo analysts armed with narrow expertise, simple tools and a personal network of resources. Nonetheless, it’s an important juxtaposition when you look at what its data aggregation platform offers.  If you agree with their assertion that the “earlier one becomes aware of a risk or opportunity, the less it costs” the more attracted you might be to this SF-based company.
  • Finally, the data intelligence company ClearStory works with financial institutions on collaborative research and customer acquisition analysis.  Their premise is to both speed and simplify the cycle of research across distributed teams, including “accessing, merging, analyzing files and a variety of external data sources.”  As they share, “competitiveness on the front lines of business is dictated by the speed of data access and the quality of informed decision-making.”

Personally, it is very interesting to learn about, and subsequently watch, companies like these these spur transformation. If you are game to share your thoughts on FinTechs worth watching, feel free to comment below — or via twitter, I’m @AlDominick, about those companies and offerings you find compelling.

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Its Aloha Friday

Cherry blossoms in DC
An example of organic growth in Chevy Chase D.C.

Earlier this week, as part of Bank Director’s annual Bank Chairman/CEO Peer Exchange, I was lucky enough to spend time with key leaders from 40+ community banks averaging nearly $900M in asset size. As I reflect on various growth-focused conversations I had with CEOs of NASDAQ-listed banks, I think I’ve found a common thread. Each person runs an institution profitable enough to make acquisitions — all while maintaining adequate capital ratios.  The interesting part (for me at least) concerns the strategies these executives set to build their brand and tactics put in place to “organically” grow their franchise.  As our industry continues to rally back from the past few years of pessimism, it really is fun to hear success stories.  So what follows are three thoughts from this week that builds on my time at the Four Seasons in Chicago.

  • While M&A offers immediate growth to the acquirer, I’m hearing that “stocking the bank for talent” is a real long-term challenge. While a bank’s CEO and Chairman must work even more closely to drive bottom line performance while enhancing shareholder value, I left Chicago convinced this team must more aggressively identify — and groom — the next generation of bank leadership. Without the big banks providing management training like they once did (an unintended pipeline of talent for community banks), its time to get creative. For example, while most at our event appreciate the need to get mobile, few community banks have the senior strategist on hand to do so right now. While that opens the door to outside advisors to support an institution, it does present longer term dangers as customers expect access to their banks sans branch or ATM use.
  • Keeping on the tech-to-grow theme, I read an interesting “big data,” bank-specific piece by McKinsey on my way home to D.C.  Personally, I’ve been interested in the various tools and tactics banks employ to analyze their massive amounts of data to detect/prevent fraud, devise customer loyalty plans and proactively approach consumers. This overview, complete with video, touch on these points and show how some are using big data and analytics to sharpen risk assessment and drive revenue.

Aloha Friday to all, especially my niece and sister-in-law on their birthdays.