A common thread through all the key trends that we have seen in the last year is that there are lots of opportunities for FinTech companies and incumbents to work closely together. While it has taken some time for incumbent financial services businesses to start finding ways to work with emerging FinTech companies, closer collaboration was a clear theme of 2016. We have seen this at Startupbootcamp with many companies from our cohort lining up POCs and pilots with corporates.
There is no one-size-fits-all model of collaboration – nor should there be - and the increasing number of instances of incumbents and FinTech companies working together is encouraging. However, there is still a lot of progress to be made. Organisations are struggling to understand how to measure the success of relationships with FinTech companies. Taking a traditional KPI driven approach may not be the correct method, whereas seeing pilots and POCs purely as R&D may lead to few being converted into full-scale partnerships or acquisitions. Where progress needs to be made with incumbent firms is the need to have business led R&D with a focus on implementation. Nevertheless, the direction of travel is to be welcomed and should accelerate.
We can also look forward to more innovation in this space from the FinTech companies themselves.
During the accelerator program we managed to set up a pilot with Enterprise Bot and Rabobank North America Wholesale Banking. For a chatbot to become client facing, most large financial institutions require to know if the team can deliver, but also if the solution being built is up to their quality standards. In order to keep momentum, a narrow scoped (internal) pilot was agreed upon, with the help of high executive involvement from the start. In most projects you would see that the corporate would define what is required, after which the start-ups would start working on a solution. However, it is often forgotten to ask what the start-ups need in order to be successful. Think about data and information that is needed, regular IT support, easy access to higher management but also someone who can move obstacles internally. Next to the technical work we are doing with Enterprise Bot, we are also learning a lot on how to improve our collaborations with start-ups.
Managing Director, Startupbootcamp FinTech London, PwC United Kingdom
FinTech Consultant, PwC United Kingdom