This is a guest post from our intern Franklin Bi .
On Friday morning, I witnessed another volley of shots being fired from New York City at Palo Alto during FinTech Innovation Lab‘s Inaugural Investor Day. The Lab is a collaboration between the New York City Investment Fund and Accenture, with support from the New York banking community. The opportunity in NY is clearly heating up, both literally and figuratively, as investors turned out in 100+ degree weather to hear about emerging technologies in the financial sector.
The event featured 6 newly-minted FinTech Innovation grads (selected out of 90) showcasing their progress after 3 months of incubation. If you’re looking for more thoughts on the event, check out Ryan Kim’s GigaOM post.
Here’s the list of the featured startups and some of my thoughts:
Zipmark is using QR codes to replace checks, giving customers and vendors a lower-cost payment solution;
Syphr is providing highly personalized credit management and financial optimization applications to improve lead generation for financial institutions and online finance sites;
Lenddo.com is leveraging online social networks to determine credit-worthiness and help middle-class people in emerging markets to obtain loans and improve their financial reputation;
CB Insights’ Mosaic is applying an algorithm-driven approach to assessing the health of private businesses, using information signals from publicly available sources to empower the due
diligence process [David Teten note: there are clear similarities between what they’re doing and my most recent startup, Navon Partners];
Hanweck Associates is offering Data-Analytics-as-a-Service to institutional capital markets in the form of high-performance, intraday and real-time risk management solutions;
Aqumin is transposing 3-D visualization and analytics software from the oil & gas industry to financial services by converting financial data into interactive 3-D charts and information landscapes.
Each of the startups made a solid case for the unique value proposition their technology would provide to the financial sector. They also exemplified several major trends currently taking place in the financial technology space:
· Mobile/online billing & payments systems: While Square is looked upon as the poster child of this movement with $4 million in mobile payments per day, the somewhat clunky hardware solution may only be the first iteration of a quickly-evolving arms race to become the dominant paperless solution for banks and consumers. Our portfolio companies OfferIQ (acquired by Transactis) is in this sector.
· Advanced risk management: After the crisis of 2008, financial institutions are clamoring to empower their risk management practices via technology solutions that perform better and faster than current offerings, with as little room for human error as possible.
· Data analytics: As part of a larger trend of "Big Data" (see our portfolio company InfoChimps), consumers and financial institutions alike are looking for tools to leverage every kind of available data — from real-time financials to social media — for capital cost savings and competitive advantage.
However, the biggest trend apparent at the FinTech event was not related to the (very impressive) technology, but rather to the location. This was a demonstration of the level of quality that some NY startups are achieving.
Congratulations to the organizers and the newly-graduating startups of FinTech Innovation Lab on a job well done!