The FinTech Startup Ecosystem
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Transcript of The FinTech Startup Ecosystem
“The FinTech Startup Ecosystem”By: John F. C. Cheong, Ph.D.
Feedback and comments to: [email protected]
“The FinTech Startup Ecosystem”By: John F. C. Cheong, Ph.D.
1. The Business of Startups2. The “Big Question”3. “Small” is the New “Big”4. Iterating to “Product-Market Fit”5. Disruption by a Thousand Arrows6. The FinTech Startup Space7. BlockTech and Recent Activities8. My Approach to BlockTech9. What Does a BlockTech Stack Look Like?10. Demographics Trumps Technology11. Vertical Networked Community12. A BlockTech-Centric Investment Thesis
Feedback and comments to: [email protected].
Building A New Business: “The Business of Startups”
“I’m starting a startup that helps other startups start up.”
The “Big Question” for Entrepreneurs and Investors:How Best to Launch and Accelerate New FinTech Ventures?
Huff! Puff!
“We can do it all by ourselves!”— Atlas
vs.
“Give me a place to stand, a lever long enough and a fulcrum, and I shall move the World.” — Archimedes
Now, isn’t this a much better way…?
“Small” is the New “Big”: How StartupsCo-Evolve with Platforms and Ecosystems.
Suite Platform
Multi-Platform Bus“There is a new breed of “big” on whom the coming age of “small” is built: the platform players (like eBay, Etsy, Amazon, Apple, and Google) on whose platforms smaller businesses blossom.”
— Nicco Mele
An Iterative “Build-Measure-Learn” Methodology:Ideas to Code to Data … Until “Product-Market Fit”.
“Disruption by a Thousand Arrows”: FinTech Startups Unbundling Wells Fargo, Citi and Bank of America.
Hundreds of Companies Across A Dozen Categories(Global Funding: $3B 2013, $12B 2014, …, $__B 2018):
Making Sense of The FinTech Startup Space:How Capital Markets Make the World Go Round …and Around?
Payments & Remittances
Lending & Personal Finance
Asset/Wealth Mgmt & Trading
(Basic Income?)
Equity Financing& Capital Markets
Crowd Funding
Insurance& Payroll
Banking Infrastructure
FinTech’s Wheel of Disruption:Six Clusters of Financial Services Innovation?
“BlockTech”: Blockchain-based Startups (within FinTech)
Blockchain Activities of Financial Intermediaries & Banks
Blockchain: A Fundamental Technology That Impacts Other Technologies (i.e., BlockTech Disrupting Tech!)
Feedback and comments to: [email protected].
My Approach: “Industry Model Canvas” for Assessing BlockTechOpportunities in and around Value Creation and Value Capture.
How Might A BlockTech Stack Be Organized?
Keep It Super Simple: A Fully ConfigurableModular 4-Layer Stack for BlockTech?
Smart Contracts
Blockchain Mediation
Proof-of-X Algorithm
Network Topology
Business logic layer where smart contracts are coded using high level languages.
Distributed ledger layer where inconsistencies and conflicts are resolved.
Transaction verification layer where proofs are computed and communicated.
Underlying network layer that determines how the nodes are connected together.
Could this be BlockTech’s “signature stack”?
Identity
Keys
Storage
Messaging
Languages
Transaction Ledger
Consensus Method
Tokens
Mining
Nodes
P2P
Let’s Not Forget: Demographics is What’s Driving Major Disruptive Changes in the World Today!
KP KA VP CR CS
C$ R$
CHKR
Business models are designed and executed in specific environments. So the external environment is like a “design space” for business models. And business models evolve to adapt to changing environments.
MACRO-ECONOMIC
FORCES
MARKET FORCES
INDUSTRY FORCES
KEY TRENDS
New Digital Technologies
Clobbered by Regulation Millennial Demographic Shift Underway
Changing Consumer/Enterprise Behaviors and Expectations
Suppliers & Value Chain Actors
Stakeholders
Incumbents’ Legacy IT Infrastructure
New Entrants’ Lower Startup Costs
Bitcoin & Blockchain Substitutes
Baby Boomers and Millennials
New Preferences for Banking
Confusing Choices
Lower Switching Costs
Less Attractive Revenue
Zero Interest Rate WorldRecovering from Great Recession Increasing Rates of Changes
The World Awash in Capital
Geographic Proximity Has Been Eclipsed by Networks:“Vertical Networked Community is the New Marketplace”
“The competitive advantages of scale are being commoditized. Minimum efficient scale is getting smaller and smaller.” — Maxwell Wessel
“Great Ideas can be Realized from Real Insight into the Way the World Spends Its Money.”
Thank You!
“FinTech”