Navigating Risk and Innovation: A Q&A with Rob Cottingham, SALT's Chief Risk Officer
What inspired your move to SALT, and how do you envision using your fintech risk assessment expertise to drive the company's growth and innovation??
A love of the sea, inherited mainly from my dearly departed ex-Navy father, and the simplicity and beauty of SALT’s digitised business model – to help more people enjoy the water today and tomorrow. What a fantastic mission?!?
The organisational values of simplicity, accessibility, responsibility, and enjoyment align with my personal and business values—plus the drive, determination, patience, and professionalism of Joe and his wonderful management team. They are exceptional people, and only by surrounding ourselves with exceptional people can we grow, too.?
Furthermore, there is an opportunity to support its structure by building out an enterprise risk framework—from bow to stern, as it were—that is appropriate to protect the business and ensure the best possible outcomes for SALT’s customers.?
Regarding innovation, a few years ago, I developed a credit risk decision engine for a UK fintech start-up, which helped to generate a book in excess of ￡100m in two years, and very recently completed an Oxford University AI programme, which was superb. So - whilst one always has to be careful not to ‘over-engineer’ the machine - I will encourage and support introducing further innovative elements to the business when the time is right.?
What are the most significant challenges for fintech startups, and how do you intend to tackle these challenges at SALT??
Well, those who know me will not be surprised to hear that I went through the Top Ten reasons why start-ups fail with our CEO and COO on Day One of my employment with SALT.?20% fail in Year 1, 50% in Year 5, and 70% by Year 10.?
But why??
The biggest challenges for start-ups are funding and lack of market need, followed by a poor product and flawed business plan.? Next are not hiring the right people and poor leadership, not utilising the available tech and poor marketing strategies.?
I did a similar ‘bucket of cold water’ exercise back in 2017 for a start-up around the same time as Monarch Airlines went bust because—like the proverbial slow-boiled frog—it did not adapt to the changing conditions around it and was left behind and withered on the vine. In summary, there is an inability to adapt to market changes.?
Finally, failure to learn from past mistakes is a common occurrence.?
The great thing about doing this exercise is that we face up to such challenges as a team with eyes open but, more importantly, with a crystal clear mission, funding good to go, a market assessment showing a market ready to disrupt, a superb app-based product, and one of the best-prepared business plans I have seen in years.?
Furthermore, we as a management team are ‘joined at the hip’—facing in the same direction—and we are led by Joe Dalton , one of the most natural leaders I have met.?
He has a clear vision and is sharp as a razor. He is determined, driven, and focused, and he is also one of the genuinely most pleasant guys one could possibly meet.?? His view is also to recruit (in his words) ‘top-tier talent’—so I can’t disagree, of course, because I have just been recruited!??
However, I would like to say that the interview process was professional, robust, and one of the toughest yet most enjoyable interviews I have experienced. That actually inspired confidence in me that this was the start-up to join.?
In summary, my role—through the development of a structured risk framework—is to hold up a mirror to the business regularly, ensure everyone is honest and open about the challenges, and ensure that actions are taken to steer any such challenges from ‘red’ to ‘green’, if I may use typically ‘Risk RAG’ parlance.?
In boating parlance, the hull is robust, secure, and solid enough to plough through any icebergs that may float our way or agile enough to steer around them.?
Given your experience in supporting startups, what strategies do you believe are crucial for fostering a culture of innovation while maintaining robust risk management practices within a fast-paced environment like SALT??
Risk and opportunity are two sides of the same coin, and we should all, as leaders, set the tone for balancing innovation and risk management.??
Employee engagement will be crucial, so we must ensure that employees understand the importance of both aspects and how they contribute to the company’s success.?
I want to see cross-functional collaboration when we have grown a little more. Experimentation and learning will be important, and failure should always be seen as an opportunity to learn. It will also be important to ensure that a robust risk management framework is in place, including processes for identifying, assessing, mitigating, and monitoring risks. That will, of course, include processes to manage regulatory risks to ensure we are fully compliant.?
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Finally, while the environment is fast-paced, we can regularly monitor and review innovation initiatives and risk management practices to ensure they are aligned with the company’s goals and objectives.?
How do you envision integrating cutting-edge technology and data analytics into SALT's risk assessment framework to enhance decision-making and drive sustainable growth??
This is almost a ‘how long have you got?’ question!? First things first—what can be digitised and automated even before we pull the AI card? Reviewing what we do and how we do it and then using cutting-edge tech to ‘simplify’ is always a good first step.? Then, we can look to pull the AI card.??
AI has been around for decades, however, the recent advent of GenAI? - and as we head towards AGI (Artificial General Intelligence – sometimes referred to as ‘human-level AI’) - has seen an exponential dial-up, not just in use cases, but in potential for the future.?
Turning more to the specifics of your question, AI can support us in understanding present and anticipating future organisational behaviours and individual behaviours within our organisation as follows:?
I won’t go into each, but overall, AI enhancements have the potential to deepen understanding throughout the organisation. They will enable proactive risk management and strategic decision-making, underpinning our drive for fast, sustainable growth.?
What are your goals for SALT to become a marine finance leader while championing fintech innovation????
My goals are to:??
?To find out more about SALT, please click here.