This week we look at how three existing firms are upping their digital services game.
Goldman Sachs: Now hiring
The trading division at Goldman Sachs is hiring. Yes, you read that right. They’re hiring, not firing. But they’re not looking for traditional traders. They’re looking for engineers – 100 of them, in fact – for “tech-related roles on the trading floor,” Bloomberg reported this week.
Adam Korn, Goldman’s co-head of engineering in the trading division, told Bloomberg: “Historically, engineers were not seen as a part of the business. That’s obviously changed.” The new hires will be working on Marquee, Goldman’s digital platform for institutional and corporate clients, which provides risk analytics, pricing data, content and execution capabilities. The focus on Marquee is part of a firm-wide drive toward automation and an API-based model for interacting with clients.
While fintech start-ups are often seen as the prime disruptors of the financial industry, existing institutions are also using technology to change the way they do business. And they have the advantage of deep subject-matter knowledge, large data sets and deep pockets they can draw upon to hire the best people.
Cloud: Not just for the big banks
It’s not just the largest of existing institutions that are driving change with technology. Alterna Bank, a digital bank owned by Ontario-based Alterna Savings and Credit Union, is partnering with nCino to provide a fully digital small business banking service. nCino, for its part, provides cloud-based bank operating systems.
Alterna Bank will offer a “single platform that supports business owners with deposit account opening, onboarding, digital application, automated decisioning, digital document management and portfolio management,” according to a release.
It may seem a small addition to this week’s 3 Things, but it demonstrates that even smaller players are using technology to change the way they do business – and speeding innovation by teaming with fintechs.
Fintech: Not just for millennials
Wealthsimple, a Canadian robo advisor with C$5 billion in assets under management and more than 175,000 customers in Canada, the U.S. and the U.K., has built its business working for millennials. But now it’s aiming for higher net worth clients.
Its Wealthsimple for Advisors unit will provide technology, dealer and advisory services to Grayhawk Investment Strategies, a Calgary-based firm that manages C$800 million “for 30 of Canada’s richest families,” Bloomberg reports. It will then offer this strategy “to advisers with wealthy clients on its platform.”
We expect to see more partnerships like this one. Robo advisors will need higher net worth clients to survive, and while some high net worth (HNW) clients want lower fees and the convenience of digital financial tools, they also want to work with a human for their more complex needs such as tax and estate planning. Creating this infrastructure will also allow Wealthsimple to retain less affluent clients who will eventually become HNW clients.
Douglas Warren is a co-founder of Walmer Road Writing. He’s a corporate writer with expert knowledge of financial markets, economics, insurance and commercial real estate.