The financial services revolution

By Theodora Lau & Bradley Leimer

Are we in the midst of an evolution or a revolution within financial services? Over the past decade, every aspect of financial services has been rearranged, unbundled, and rebundled — as has the concept of what digital disruption truly looks like for incumbents in the space. 

Between new forms of customer value, and new directions for financial innovation, it’s more of the wild wild west than ever before. But what has this external influence on the industry wrought? What has changed to act to benefit us all?

Where is the real revolution? 

Real revolution is far more gradual than the shared experience of the zeitgeist of a moment. It is a long seduction where the change is subtle — until it’s not. A variation here, a new norm there, and something that stumbles slowly and ends with lasting repercussions. History is made one subtle mark at a time, but it’s impact is far more lasting. 

For financial services, the initial moments of real revolution have their roots in our society, where the seeds of inequality began, where the need for banking superseded those who truly needed services such as these.

But that’s not what this is about. 

It’s about so much more. 

The real revolution in financial services started when customers at banks weren’t having their needs met. The real revolution started when banks grew too large and unbundled their internal teams supporting products and services in order to maximize profitability for each product line. The real revolution began when technology became too complex to replace real human relationships, just as technology external to the industry was doing quite the opposite. 

A real revolution began when we realized there were other options.

A revolution that is more than necessary.

One to both challenge the industry and to simply wake it up. 

Wake it up to opening up new forms of customer value; wake it up to investing in technology to build true customer intimacy over efficiencies and profitability; wake it up to product teams devoted to increasing usability of services long ignored; wake it up to a new economic reality facing our communities, especially those embedded since the Great Recession and reaching toward this Global Pandemic.

Stop shuffling the chairs and making excuses.

It is past time to build. And to build better, we must.

Revolutions take time for historians to connect the dots. 

Our lives are changing rapidly; our financial needs are changing with them. The profits of Wall Street have little to do with the equality needed on Main Street. We need the business model to do more, serve more, and wave the flag into a battle far from won. 

We must demand more.

Revolutions take time to be felt by Main Street. 

But can we win the battles of hearts and minds? 

At what point do we abandon our ideals and principles — just so we can survive?

Can profit and purpose co-exist? 

Can the student become the teacher? 

At what point do we let go — and surrender?

Is there a grey area where we can dance?  

Back to this reality: Fintech is politics. 

When you look at the role policy plays in our country, fintech is in part driven by the desire and the market opportunity to fix what is broken. 

Adam Smith must be rolling in his grave. 

When you develop your value proposition based on nudging people to lead a greener life — that in itself is a political statement. 

Taking a stand on where you want to be remembered in the fight for sustainability — whether it is enabled by rounding up purchases to plant a tree, or by accumulating green points via certain activities — that is a political statement.

When our choice of payment is a symbol of nationalism, we know something is amiss. 

When political motives stifle innovation — where do we draw the line?

Fintech is politics. Financial services is politics. 

But why wouldn’t we just call it that?

Why is there such a taboo in taking a stand — for what we think is right?

If you stand for nothing — what will you fall for?

In a world where data is being manipulated to substantiate decisions that have already been made — instead of being used to draw conclusions; where facts are being exploited to show only one side of the story — do we even know what is right, and what is wrong?

Why can’t we strive for a business model that goes beyond good toward a greater good? 

In a society where civility is all but extinct; where journalists are forced to take sides and defend themselves; where op-eds and extremism are disguised as news — is there still hope?

Where is the transparency?

Where is the accountability?

What is fair?

How do we even bring back the balance? 

A walk toward the altar of history, the spark of a revolution — they require sacrifice, commitment, and fortitude. 

We must be there to take our shot.

For every action, there is a reaction. When the pendulum swings too far in one direction, it will go back. So goes the business model of banking as well. 

Do we sit back and let the free market get to its equilibrium? Or should we stop it mid track and work together to fix all that is broken?

The pain is too much. The effort is far beyond what we can pull together. The structural inequality is too deep rooted in our history. 

We can come up with a million reasons to not do anything — and let the invisible hand do its work. Because that is the easy way out.

But.

We only need one reason to act. To band together. To change the industry for the better.

The cost of inaction is far too high.

Democracy is not a spectator sport.

Capitalism does not mean the winner takes all. 

No more words, we must take action.

What are you waiting for?

Join us in the revolution. 

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Tune in for a new episode of One Vision via iTunes and Spotify with Gregg Schoenberg, Managing Partner at Wescott Capital, and Founder Editor and Co-Founder of the Financial Revolutionist, as he chats with Theo and Bradley of Unconventional Ventures about the ongoing revolution within financial services. As always, you can listen to this and every episode of One Vision podcast on your favorite player. 

Thank you for listening, and please help us bend the arc toward the common good.  

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Unconventional Ventures helps drive innovation to improve systematic financial wellness. We connect founders to funders, provide mentorship to entrepreneurs, strategic advisory services to a broad set of corporates, and broaden opportunities for diversity within the ecosystem. Our belief is that anyone with great ideas should have a chance to succeed and every voice should be heard. Visit unconventionalventures.com to learn how you can partner with us today.