- Business Insider polled 44 executives across the financial services world to find an answer to a seemingly simply question: what is the definition of fintech?
- Fintech first entered the mainstream vernacular roughly a decade ago, but with every passing year the term gets harder and harder to define.
- We split the responses into three groups: traditional players, fintech investors, and fintechs themselves.
- The goal was to understand how different types of firms and people define a term that’s applied widely but is nearly impossible to explain concisely.
- In 2019, VCs poured more than $24 billion into startups that put a tech spin on spaces ranging from asset management to lending to payments to insurance, according to a CB Insights tally of fintech investment.
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It’s arguably one of the most commonly-used terms on Wall Street, yet no one can agree what it means.
Fintech first entered the mainstream vernacular roughly a decade ago, but with every passing year the term gets harder and harder to define.
As Wall Street puts more research and focus towards technology, what can be categorized as a fintech continues to expand. And with tech players like Amazon and Uber making noise about getting into financial services, things have gotten even more confusing.
Now, one can hardly read a story about Wall Street without at least a slight suggestion of the power, potential or problems tied to fintechs.
Business Insider set out to pin down what exactly a fintech is by asking the people that should know the answer best: the investors that fund them; the traditional players that partner and compete with them; and startups themselves.
The responses were illuminating, as they provide perspective on how the most powerful players view up-and-coming technology.
And seeing these responses is crucial if you want to understand how incumbents are tackling the buy or build question, and for unpacking what’s truly a disruptor and what’s really just a fancy app.
Some said that “fintech” isn’t enough to capture what’s really going on, and that there’s a serious need for more precise terms. One pointed out that the first ATMs in the 1960s could be counted as the official birth of fintech. And several even argued that the term needs to be retired.
Click below to see responses from all three groups:
We asked 9 execs at Wall Street giants like Goldman Sachs, BlackRock, and JPMorgan what ‘fintech’ means to them. Here’s why they say fintechs are friends, not foes.
Wall Street players largely dismissed the notion of any competition or rivalry. There was a lot of talk about partnerships, and some said that incumbents have been the real drivers of fintech all along.
14 big investors like Bain Capital Ventures, Kleiner Perkins, and Point72 weigh in on how the meaning of fintech is evolving — and no one can agree if the term should be expanded or retired
Long answer short — it’s complicated. Some big investors see defined borders, others described more of a continuum, and a few try to avoid the term entirely.
Fintech has become a buzzy label that often doesn’t really mean anything. We asked execs at 21 startups like Brex, Kabbage, and N26 what really counts.
The lines between big tech, startups out of Silicon Valley — or Alley — and the legacy players of Wall Street are blurring. Here’s where startups think they fit in.
SEE ALSO: Green Dot’s bread-and-butter businesses have been undercut by VC-backed neobanks. It’s turning to techy partnerships with the likes of Uber to restart growth.
SEE ALSO: Neobanks like Chime are attracting billions in VC cash, but unlike most retail banks they don’t do any lending. Here’s how they’ve built a business on referrals and debit card swipes.
SEE ALSO: Uber and Apple are just the start, and eventually every company will want to be a fintech. An Andreessen Horowitz general partner explains why.
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