Investments, Financial Management, and Even Some Virtual Reality: Finovate Day 2
SAN JOSE, Calif. – Day 2 of Finovate saw a seeming parade of wealth management and investment solutions, but the final one included a new twist — virtual reality. Was it a bit frivolous? Was the use case far-fetched, strained, even bizarre? Could be, but the audience appreciated it anyway simply because differentiation is getting harder to achieve in fintech, which is seeing an influx of new roboadvisors chasing a finite number of clients.
The consumer play is a difficult one for wealth managers, and already well-populated, but the B2B2C play is wide open. An undercurrent at Finovate Spring 2016 was that the time for partnership has seldom looked better from the FI side — startup funding is getting tighter, and customers are still hard to come by. Banks are sitting on customers and funds, and surrounded by an ocean of innovation. Notably absent: insurance. And now for today’s startups, followed by our winners:
The day’s first demo brought together Finovate elder statesman Yodlee’s data aggregation with Envestnet’s wealth management service for goal-based investing under the umbrella of the Advisor Now tool. (Envestnet bought Yodlee last fall.) This tool builds on what CEO Anil Arora discussed on last week’s earnings call — gaining synergy from the Yodlee and Envestnet lines of business. But when will they settle on a name for this brand? Do we need to hear both Yodlee and Envestnet every time?
Ephesoft extracts meaning from unstructured content, the company says. (This is sort of what life is all about.) Financial services have a lot of unstructured content to deal with, and Ephesoft can help — after all, it also works with the federal government, which has even more. Ephesoft demoed a cloud-based enterprise document capture system for mortgages and mobile onboarding. The company does the familiar document capture for authenticating users and collecting data, and adds analytics on top of it.
Silver6 showed video messaging for customers that changed on the fly with the input of user data. The demo relied on video, which was a bit jarring at first, but then again, video IS the product, so it was a demo, of a sort. The Silver6 engine builds videos out of account data to form video statements. The video somehow “knows” which parts were watched, though it was not clear how.
ThreatMetrix finds bad guys and bad transactions amid all the good ones. The company works in the background to collect over 500 attributes from even a short form or loan application, then informs banks about possible threats. There is information about the device being used, of course, and ThreatMetrix adds data from third parties and external sources and mashes it together to form a visualization of threats. ThreatMetrix was one of a number of companies taking on the digital identity problem — forming a user’s digital identity, negatively, in this case. Showing who we are in a secure way online is shaping up to be THE problem of banking and just about everything else. Blockchain? Chatbots? Who will solve this?
BaseVenture demoed a new service for fund managers, offering digital fund management via its fundmanager.io site. A partnership with law firms enables embedded executable documents for rapid approval of contracts and documents. The demo also included an impressive and sophisticated document management system.
DigiByte is a bitcoin competitor said to be faster and more reliable. In essence it is a cryptocurrency play for sharing value in a more bank-friendly way. DigiByte also showed document-signing technology leveraging distributed ledgers to take on Docusign, and a gaming play for microtransactions – you know, for kids. How much is a DigiByte worth?
LendingRobot automates investments in marketplace lending for an average of 9% returns. Why do you need a robot? Because the best loans are funded in seconds, CEO Emmanual Marot said, and you’ll miss them. A robot might not. Investors get diversified portfolios assembled by LendingRobot. Users set risk tolerance and LendingRobot builds them a basket of loans. Android and iOS dashboard apps launched a month ago. The platform manages $100 million in assets for 5,000 clients.
CarLinX is, as the name may apply, a card-linked offer platform. Restaurants throw out 30% to 40% of the food they buy due to poor data and lack of forecasting, CEO Silvio Tavares said. CardLinX helps with card-linked offers for that day the restaurant has too many avocadoes. Demoed was a wizard for creating card-linked offers for merchants. Users can create an offer, search for an offer, even request an offer. The service will be sold through banks to business customers.
NUDetect from NUData Security finds out who is visiting your site or app by using behavioral authentication to build digital identities for visitors. By looking at the device, biometrics, and device behavior, it is possible to build these identities. The way users type and so on gives an understanding of the human behind the machine.
ForwardLane offers the ultra-high net worth client experience to the merely mass affluent. The service is a roboadvisory that leverages machine learning to offer relevant advice. Data arrives via – who else? – Xignite. Bonus points were earned for mentioning both roboadvisors and chatbots in the same presentation.
PayActiv offers advances on paychecks – the idea is to take down payday loans. The service can be offered as an employee benefit. Risk is low to PayActiv because the money has been earned. As with Uber’s instant cash-out program, PayActiv allows employees to get access to payment for every hour worked. Using a mobile app, the user adds money to her PayActiv account. Each transaction carries a $5 fee. The service also includes a savings tool.
Corezoid is a cloud operating system for banks. In a passionate presentation, Head of Marketing Sergii Danylenko said that card networks will disrupt banking by becoming the backend for merchants, while the front ends are controlled by messaging services and smartphone manufacturers. Banks are reinventing the wheel and duplicating effort, Danylenko said. There should be a uniform process layer on top of Visa and MasterCard APIs. Corezoid wants to be this process layer.
Advisor Software will allow financial managers to create branded robodavisors and build model portfolios. Clients can onboard online and have portfolio and goals built. It was described as a turnkey lead-generation portfolio management tool built within the Compass CRM.
Digital Foresight from NIIT Technologies is a high-value targeting engine that uses predictive analytics and external data to track prospects and wealth managers. Relevant realtime data is provided about prospects, and social media intelligence is also used.
The name blend stands for “better lending” – the company uses tech to take on the next wave of mortgage lending. Blend demoed a step by step mobile mortgage process, including a co-pilot capability so a loan officer can walk borrowers through the process. A log of activity – compared to a Facebook feed – exists for borrowers, lenders, and regulators. The solution can be white-labelled (of course).
PayNuver is a solution for disbursements to avoid sending checks, which can cost $3 per check, or more. The example used was an insurance company which needs to do a payout. The system notifies recipient via SMS or email. Funds can then be put onto virtual cards, or pushed to a bank account via ACH. A batch mode exists for mass payouts. It was unclear if recipients need to set up accounts with the service.
VIX Verify enables the global underbanked to identify themselves to financial institutions. The company demoed its three-step mobile onboarding and authentication process with GreenID: ID card, selfie video, and various third-party data sources.
SwipeStox says that in Europe it has been called the Facebook and Tinder for trading. The stock-trading app opens with a newsfeed that learns what the investor is interested in. They then swipe through trades and film quick Snapchat-like videos explaining why they are doing what they’re doing. B2C focuses on social – but the company also does B2B and has a white-label solution.
Malauzai Software showed off a tool for building mobile apps. Local businesses can build mobile wallets powered by their banks. The visual app builder was clean and intuitive. Modular features to publish an app based on their customers were prominent. Also introduced was MOXPay for billpay and P2P payments.
Switch is a card management tool that can update or switch credit cards stored in various sites and apps. With the increasing digitization of finance, users need it to be easy to get cards into apps or sites for use. Additionally, the company demoed a card management report for FIs, to see how its cards are being used vs competitors’ offerings.
Fiserv showed off its mobile account opening process, which includes social media links, an Uber link, TouchID, data importing through the smartphone camera, out-of-wallet questions, and a “mascot” to keep the consumer apprised of his stage in the onboarding process. Immediate funds were available through Fiserv’s own realtime payments solution.
Auvenir is looking to disrupt the financial audit industry. The system is built to work via mobile. Data is pulled from the web to prepopulate fields. Audited companies can collaborate with their auditors via mobile for document sharing.
Chip Shield is looking to secure EMV cards during online shopping with a hardware card reader. The service also supports virtual cards for one-time use, and can be used for two-factor authentication. “You don’t have to take a selfie to use this,” CEO David Marsyla said, holding up a card. But would card-present rates be charged for online transactions accomplished with the reader?
Sberbank, Russia’s largest bank with 100 million retail customers, announced a messaging system, Sberbank Messenger, that is integrated with a user’s mobile banking app. Users can send money, pay bills, and shop, using fingerprint authentication. A number of partner businesses appeared on the site. Businesses listing in the app have a toolbox to select from to build up offerings. Third-party developers can also contribute tools.
Finaeos is a cloud-based ecosystem for raising funds and investing in deals. It includes a social platform for connecting different players in the ecosystem. Investors can find a listing of deals – and entrepreneurs can get funded.
Polly Portfolio delivers your firm’s investment expertise to your clients and interviews investors in order to deliver portfolio recommendations. The company uses natural-language processing to deliver human-readable advice. Polly Portfolio wants to be a backend to an advisory firm rather than a standalone roboadvisor.
ShortSave is a way for lenders to help distressed borrowers and to give additional visibility to both. The multichannel process collects additional data and helps servicers modify borrowers’ loans to keep them as customers in good standing. Loan modifications for mortgages can take 30 days – ShortSave demoed doing it in moments.
Credit HQ helps small businesses get better control of their cashflow. The service, provided by the bank, gives visibility into companies with which SMBs are doing business. There is also a dashboard for SMB bankers to use to help their clients. The service has gained traction in Europe and is now launching in the U.S.
Comarch demoed a virtual reality investing app. Yes, virtual reality. The VR experience offers a personalized newsroom, meetings with advisors, and portfolio overviews. Comarch “brings ‘private’ back to private banking” – with a little fun, the company says. The use of virtual reality was absurd, but welcome to the weary crowd.
BrandCrowder offered a platform for investing in franchises, which have outperformed the stock market by 33%. The startup builds curated funds that are offered to investors based on their profiles. Professional investors are also included so users can follow them, or not. Investors do not need to be accredited, though some deals are only available to accredited investors.
Race Data is a database marketing company. Banks use Race Data to inform customer engagement representatives to enrich their knowledge of the customer. The relationship accelerator offered by Race Data can help small banks take on the big guys.
Sezzle is taking on merchant processing by facilitating ACH payments between consumers and customers with Sezzle Pay. It does this by linking bank accounts together, so users must link their account to Sezzle – a challenge. Sezzle’s processing fee is 1.5% + $0.15. Consumers get 1% rewards – most consumers use debit cards and get no rewards, CEO Charlie Youakim said.
Today’s winners: Silver6, Corezoid, Malauzai, Sberbank
