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Wednesday, 15 January 2014

my short blog re Disaggregation of a Bank - Fermi.VC

Disaggregation of a Bank - Fermi.VC:

Hi Zander

great start of a conversation regarding a very important area of startup.

Almost all however are mainly looking at doing the same thing better/different. As many great entrepreneurs have show from Steve to Bill, the biggest opportunity lies with a firm/product that

1.) disrupt a market or

2.) changes the value chain or

3.) create a new business model (ideally all three!)

Therefore, IMHO, biggest potential startup opportunity is area(s) in finance that needs fixing. Banking is one important vertical but there are many other players from insurance/re-insurance firms, to asset managers/pension funds, as they need each others' support in the very complex & intricate finance/capital market. 

First lesson from any entrepreneurial professors and even entrepreneurs turn guru would say what are the problems, and how do you propose to fix them!  Given the dire economic situation of the world right now, no doubt we can all think of something to fix?

a good example is, what "really" went wrong before the credit crunch? is it fixable? some might argue that the real fault lies with the value chain, how information is used, valued and maybe in fact the process of 'securitisation' itself.. ?

e.g. from fund management startup like Nutmeg to any future startups that can augment/change/fix the systemic financial/capital market risks would be the next iPad of finance. (look at it from billion pension funds, Family foundations' perspective)

so, yes, disaggregation is key but probably providing a solution that would fix the broken part(s) of the financial/capital market could very well be the lowest hanging fruit/holy grail.

Technology will play key part but substantial capital will also needed to buy a seat at such a table and sadly the 6/7 figure sums of typical VC investments sadly might fall short; as big corporates would pay more than that per project just for opinions!? equally, likely return would also be substantial and of course barrier to entry!

not a game for the faint-hearted.

BR

@GarethWong

Must check out his slides (suggest full screen and download if you figure out how!):


View Disaggregation of a Bank v1.pdf and other presentations by alexander33be.

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