The woman in the global Fintech arena

teddy-man-in-the-arena.jpg

When Theodore Roosevelt was writing this ode to entrepreneurialism, I assume he never thought about writing woman instead of man and that he never imagined anybody with a different skin colour or religion.

His main point is one that we can all agree with. There are only two players in arena:

  1. The Entrepreneur
  1. The Customer/User

Arena implies conflict and the interactions between Entrepreneur and Customer/User should not be about conflict. So here the analogy breaks down and we should talk about actors on stage. The key point – whether it is an arena or a stage – is that there are only two types of people who matter.

Everybody else is a spectator, with maybe a minor role – handing body armor to a gladiator counts as a minor role. Many of these spectators are entrepreneurs in their own domain. For example, a VC is a business like any other and creating a startup VC Fund is as tough as any startup, even though it may not seem like that to an entrepreneur pitching for investment (they just see the piles of money not what it took to create those piles). Speaking from experience, Daily Fintech is a spectator and analyst in the Fintech business, but in the media business we are in the arena/stage as entrepreneurs.

However, leaving aside the definition of who is in the arena/stage and who is a spectator, this post is about updating our view of who an entrepreneur is.

Sexism is dumb business

Silicon Valley gave a great gift to the world, which is the art of starting and scaling a business, but Silicon Valley also gave us a rampantly sexist culture, as the Uber story reminds us yet again. The VCs have too few women partners and they invest in too many entrepreneurs who build businesses where women are second class citizens at best.

This is not just about being politically correct. I think that sexism is wrong, but my concern here is business, not Corporate Social Responsibility PR.

When 50% of your market is not represented in your decision-making, you have a problem. You will be selling to a world that disappeared around the time of Mad Men and Archie Bunker. That is not smart.

The Family CFO is often a woman. If you want to sell lending or other financial tools you will be doing yourself a major disservice if your company culture blinds you to the nuances of marketing financial services to women.

I am pleased to say that with Efi, Jessica and Julia on the Daily Fintech team, we have almost the opposite problem – not enough men.

Countries where men and women operate more equally in the workplace tend to also be places where  a lot of innovation takes place. The Nordic economies come to mind.

It is not just about engineering any more

The defense of the Silicon Valley VCs and entrepreneurs is “of course we would hire/fund more women, if there were more women engineers”.

That puts the problem back with education and society. Everybody on the Board can agree to move onto the next item on the agenda. Sadly, there is a cultural and educational problem, where at an early age girls are encouraged to give up on math and chess and other things that would position them well for an engineering career. There is some truth to that defense.

There are exceptions. There are great women engineers who ignored social convention when they were young and continued to focus on the math and chess that they loved.

However, they are the exceptions that prove the rule. While we can and should bemoan this and seek to change it, that change will take time. Today there are not enough women engineers.

However, the “not enough women engineers” defence is baloney. You do not need an engineering degree to become a great entrepreneur.

Steve Jobs was not an engineer.

While there are huge engineering challenges, in areas such as transportation and energy, there are also lots of challenges which are not primarily about engineering.

Much of the focus on engineering is myth. The founding engineering in ventures such as Facebook, Uber, Twitter, AirBnB and Snapchat was trivial. As the old saying goes – this is not rocket science.

Is it that entrepreneurs such as Mark Zuckerberg and Travis Kalanick are so obviously male?  Is a testosterone fuelled combative attitude essential to success?

The great digital success stories are about building ecosystems of value. That sounds like something that requires more than combative skills – attributes such as empathy and ability to listen that we tend to associate more with the female of the species.

The degree to which engineering is critical depends on where in the stack you focus.

Consider the Blockchain revolution, the transition from the “content exchange Internet” (that started c 1994 with the Netscape browser) to the “value exchange Internet” (that started c 2009 with Bitcoin).

Although there are plenty of hard core engineering challenges at the bottom of the Blockchain stack to do with with scaling (such as SegWit and Lightning Network and Proof Of Stake ), if Blockchain is to have the huge business and societal impact that many (including myself) expect, it has to become as easy as using a service such as WordPress or writing some basic scripts.

The other big disruptive technology is AI This is mostly now available as open source and through cloud based services.

All of these underlying hard core technologies are available through the Open API revolution. This makes all this underlying technology readily available to entrepreneurs working at the Customer Experience layer using social, media, analytics, cloud (SMAC).

The mantra now is “write less code”.

At the Customer Experience layer what matters is delivering service that truly engages and delivers value to the customer – including the 50% of customers who are women.

Huge opportunities are not constrained by technology. The technology is there. What we need are solutions that solve real problems for people. That is an equal opportunity challenge. No engineering degree is needed. Being totally comfortable with technology as a power user is part of the job description but that is hardly a rare skill set these days.

Sorry Archie, you are a minority

When Archie Bunker was on TV, the idea of a world controlled by a white, Christian population was already absurd enough to make good comedy.

Over 40 years later, it is more than absurd. As we look out at where Fintech innovation is coming from we increasingly see it coming from China, India, Africa and other countries where people look, act and think differently (aka the Rest of The World). This is what we have tagged “first the Rest then the West” trend. The combination of huge populations with unmet needs and ability to leapfrog over legacy technologies, makes the Rest the locus of innovation today.

The whole Silicon Valley VC model is at threat from this big shift, because VC Funds have not found a way to scale geographically. While they have nailed how to scale their portfolio businesses, their own business is defiantly artisanal. They can only invest in ventures that can be reached on “less than half a tank of gas in a Ferrari”.

It is no longer enough to invest in immigrants in the West. That is OK as an interim step, but now the challenge is how to invest in the person who decided to stay in China, India, Africa and the Rest or to relocate back there because that is where they see the most opportunity. As these countries get better at capital formation and capital allocation, the innovation capital business will change forever (and for good).

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One thought on “The woman in the global Fintech arena

  1. Hi Bernard,
    I really enjoyed reading your article during my morning commute, it gave me a few chuckles. I agree, you don’t need an engineering degree to create an innovative product or service. Yes, women and people of color are needed in this industry.

    Like

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