Banks are searching far and wide for their next big fintech. But have the solutions been under their noses the whole time?
Big banks have always had a raging crush on fintech. For decades, they’ve been trying to slide into the seat next to start-ups, fake yawn and wrap one arm round the back of the chair. There’s the $4 billion Barclays Accelerator. Duetsche’s $1 billion Innovation Lab. The $2.7 billion Fintech Innovation Lab, backed by nine global banks. The list drones on, “accelerator” this, “innovation” that. While some flopped and others were surprisingly successful, they mostly mulch down into the same thing.
2023’s insatiable hunger for overlooked founders, however, is new. This year, Bank of America launched the optimistically named, “Breakthrough Club”, an incubator for under-represented communities. Spring saw UBS leap into action with Project Female Founder. And Morgan Stanley turbocharged its Inclusive Ventures Lab significantly in September. But while banks throw their arms open to the world, have they overlooked those already in the office?
Trading floor founders
30-year-old Niki Issaia is the co-founder of a ground-breaking fintech that transforms everyday clothes into assets. She’s exactly the kind of founder banks hope to attract.
Having spent years on the trading floor, Issaia sees our wardrobes as unexplored markets, financial Narnias, ripe for disruption. A blouse, skirt, or decades-old pair of jeans is not yesterday’s clobber, but “an asset”, with locked-in value. Her start-up Charles is already valued at nearly £700k and has been fiercely backed by fashion brands and investors alike.
Hot on her heels is Bhumika Gupta, another breathtakingly smart founder. Together with her brother, she’s pioneering Bond Geek, a bond trading app for UK retail investors. Considering how mainstream a Robinhood for bonds could become, it’s astonishing that she hasn’t been snatched up already. Especially as she works in finance, in plain view of banks so desperate to capture people like her.
But it’s not just the traders swapping office badges for CEO business cards. Just a few years ago, Ayesha Ofori managed hundreds of millions in Goldman’s Wealth Advisory. Today she’s the founder of Propelle, a fractional property investment platform geared towards women.
Business bootcamp
Issaia, Gupta and Ofori formed their ideas at Goldman Sachs, which fosters a uniquely go-getting culture. “We actively encourage people to think outside the box and do more than just the day job”, affirms EMEA Head of Talent Strategy and Diversity, Equity & Inclusion, Shefali Gera.
Employees treat workloads like their own businesses, priming them to become founders. “You need to have a very entrepreneurial mindset”, agrees Gupta. “A lot of colleagues of mine were working on something on the side”.
A weekend hustle, sure. But creating a fully blown fintech? This a post-COVID burst. Behavioural expert, author, and co-founder of Whateverland, Elin Helander believes we’re at the start of something new. “Women nowadays have much more confidence than earlier generations. And thank God for that”, she highlights.
Banks like Goldman are extremely good at finding and creating entrepreneurs… But not so good at keeping them.
The power of purpose
According to Helander, today’s female founders need two things to make the leap, “self-confidence”, and “meaning”. All three women revealed that while they enjoyed – even loved – their work at Goldman, it didn’t give them that all-important purpose.
“Although it was incredible, at the end of the day it was just numbers on a screen”, Issaia reflects. “I realised I wanted to work with real assets”. And what could be more real than the clothes on our back? Issaia wants to democratize wardrobe wealth.
Likewise, Ofori finds purpose by empowering women with property. “At Propel, we want to help women build investment confidence, we want them to feel confident”, she explains.
Forecasting won’t fix it
As the founders grow their businesses, the Goldman connections proved to be vital. Issaia explains how her network helped with “interviews and set up investor meetings”.
“The people who supported me when I was 24, also supported me in my 30s!”, she laughs. And Ofori even went back to join GS Launch, a programme designed to boost fintech founders. ” I feel like my relationship is even better since I left”, she smiles.
So, it’s bizarre that not one applied to GS Accelerate while they hatched their ideas, Goldman’s in-house fintech incubator. Nobody had even heard of it. A 2019 interview from Head of the programme, Tanya Baker reveals GS Accelerate was set up precisely because, “a lot of people leave and go and do great start-ups”. Ever the forecaster, the brains at Goldman predicted an exodus of talent could happen, planned for it, but still couldn’t prevent it.
Missed opportunities
There’s a history of banks missing out. CEO and Founder of PensionBee, Romina Savova spent years as an Analyst at Goldman Sachs and Morgan Stanley. Anne Boden worked at Standard Chartered, UBS and RBS before she set up her iconic challenger bank, Starling. Imagine if someone said, “Hey Anne, do you have any thoughts on us starting a digital bank?”. Or “Romina, do you think we could improve our pensions?”.
In 2023 alone, 623 female founded businesses exceed £10.2 million in turnover, with 70% coming from business and professional services like finance. How many more are already in the works? And how many fintechs will financial services overlook?
So, what can banks do to soak up some of the talent hiding in plain sight? The answer seems clear: Be more proactive, provide more purpose or both. With multi-millions at stake, can they really afford not to?
