At the beginning of October, the first FinMeetsTech-conference took place at Frankfurt School´s Präsidialbau. The FinMeetsTech is a conference that is mainly for young entrepreneurs in the financial technology field and those who are willing to shape the future of banking. Beside of interactive speeches of successful FinTech-entrepreneurs and experts as well as some pitches there have been mentoring-sessions for young FinTechs in which they could work hands-on on their business model.
What is FinTech?
FinTech is a line of business based on using software to provide financial services. Whereas the term usually is meant to describe all start-ups that work with a customer-centric towards providing financial services, such as Number26, it is sometimes also used to describe start-ups that provide services to banks, such as IDNow or 360T.
The market for FinTechs is increasing steadily. Whereas global investments in FinTech start-ups has been around $3 billion in 2013, it quadrupled to over $12 billion in 2014. But there is still a market to get into. Only the IT-investments of traditional banks had a volume of approximately $270-460 billion in 2013.
Therefore, the FinMeetsTech drew attention to this increasing development. Whereas Berlin is still considered as Germany´s FinTech-Hub, there are more and more start-ups founded in Frankfurt. It has been the purpose of the FinMeetsTech conference to connect this growing ecosystem and to provide some “hands-on” presentations and working sessions to current and future FinTech-founders.
Who organised the FinMeetsTech?
The FinMeetsTech has mainly been organised by the Gründermaschine GmbH. Gründermaschine is a pre-seed incubator for FinTechs that has been co-founded by two FS-Alumnis. Moreover, also the MHB Bank, Schalast & Partner as well as the SupBRT and CommerzVentures participated in the organisation of the FinMeetsTech.
The MHB Bank is active as a so-called fronting-bank. Many FinTech-concepts, especially those concerned with deposit and credit processes, need a bank license to operate in Germany. As this is a rather expensive requirement for start-ups, fronting banks offer their regulatory framework for those companies. Within the “Banking Mentoring” track, the start-ups got the chance to catch up with management of the MHB Bank and to get some input from their point of view.
On the other hand side, legal advice is usually also relatively expensive for FinTechs, though necessary. Therefore, the attorneys from Schalast & Partner provided their expertise for the young companies. Moreover, the SupBRT challenged the business concepts from a technological perspective, whereas CommerzVentures provided their standpoint as an investor.
Last, Frankfurt School supported this conference not only by sponsoring the location, but also by providing academic insights into this topic. For example, Prof. Udo Steffens, Prof. Michael Kötter and Prof. Nils Stieglitz participated in different parts of the conference.
What were the main insights from the FinMeetsTech?
Whereas experienced entrepreneurs, such as Tamaz Georgadze (SavingGlobal), Mark Henkel (Paymill), Thomas Stagat (Yapital) or Hannes Aigner (Holvi), provided insights into the development of their businesses, the overall development of FinTech has been discussed within different panel discussion. While Robert Haselsteiner, mainly known for founding Interhyp, said that the main advantage of FinTechs is their sales expertise, earlybird’s Christian Nagel highlighted the high volume of investment that is necessary to develop a well working FinTech.
This is especially true as FinTechs need to be good in three different areas: They need to get their financial engineering right, have a good technology expertise and need to comply with regulations. Therefore, Prof. Nils Stieglitz concluded that, although FinTech might not presuppose as much domain knowledge as biotech, it is probably more complicated to found a FinTech company than an eCommerce business.
Furthermore, whereas FinTech is still a huge market to be developed, the conclusion of the final panel has been that there might be an even larger market to be gained in the insurance sector.
Why did Frankfurt School support this conference?
The FinMeetsTech has been an ideal opportunity for the Frankfurt School to provide students with an attitude towards funding a profound platform to connect with the entrepreneurial ecosystem in Frankfurt. Moreover, as leading Business School in the financial sector, it is a central objective to the Frankfurt School to actively shape the future of banking.