How APIs, Analytics, and Algorithms are Transforming Finance: Q and A with Former Rocket Scientist and Emotomy CEO Dr. Patrick Beaudan
Patrick Beaudan and three other fin tech executives will be speaking at the next Uncharted Minds: How APIs, Analytics, and Algorithms are Transforming Finance, Wednesday, February 24, 2015 from 6:00 PM to 9:00 PM (PDT) San Francisco, Click here or use the code ‘insider’ for 50% off tickets to the event
Fin tech is an elusive term, how would you define the space?
Fin tech is all about digital software that makes finance easier, smarter, cheaper and safer. Take Emotomy for instance — it allows investment advisors to upgrade from abacus and spreadsheets to online interface that makes advisors smarter and more scientific in analyses, with more time to dedicate to client management and education
There is a lot of talk around big data and analytics but is it just hype? Is the access to data, through APIs really changing how finance works?
Anyone who thinks that big data and analytics is hype is obsolete. Just look at how Facebook and Google know all about which sites you visited seconds ago. Access to data on who did what when for how long and how much, will change how financial institutions view individual credit, company financials, capital markets information, and many other things. Emotomy has APIs connecting to online brokerage firms and TAMPs to automatically trade thousands of investor accounts through 4 computers. The efficiency is amazing.
What area of financial innovation are you the most excited about? What are you least excited about?
Any area in fin tech that helps level the playing field is exciting, and can bring tremendous opportunity to groups that would otherwise not get access to information. Fin tech is helping democratize access to information, and it can have incredible far reaching implications. Emotomy feels good about bringing institutional-quality investment, risk, and compliance tools to professional advisors so that they, in turn, can provide high-level investment advice to their investors.
What’s the biggest challenge entrepreneurs and small businesses will face in 2016? What advice do you have for them to navigate it?
The biggest change in 2016 will be access to capital. The past 5 years has marked an era of cheap, available capital. Interest rates are near zero, and the market has grown year over year with double-digit growth. Therefore, the opportunity to exit a private investment via acquisition or IPO was relatively easy. This is changing in 2016 as markets are correcting, and more realistic valuations will kick in. The model of raising quick VC money, hyping up the brand with ads, and quickly flipping, is no longer going to work.
Is the change that the finance industry is experience transformative? Are fin tech startups disrupting incumbents?
Yes. Just think of how easy it is today to pay a bill using fin tech apps. Traditional financial institutions will quickly have to adapt or lose big portions of their businesses. Emotomy is providing turnkey B2B robo-advisory platforms to independent investment advisory firms so that they can compete with mega institutions with a fraction of their expenses.
What advice do you have for prospective employees who want to join a company like yours?
Experience working and knowing the market you want to disrupt is key to knowing what issues need to be solved through disruption. Relationships built in these markets can be converted to customers and investors.