Blockchain! Peer to Peer Lending! Robo-Advisors! Cybersecurity! Symphony Messenger!
If you listen to the financial media, the tech media, or "innovation groups" at banks, these five seem to be the only disruptive themes in FinTech. And if your job on Wall Street isn't being disrupted by them, you might be thinking "Cool… tech. Glad my job is safe".
Bad news. There's a lot more disruptive stuff happening in FinTech that isn't discussed in the media because it's super unsexy and makes for terrible news copy. Rest (un)assured that entrepreneurs all over the world are constantly thinking about which niche segments of Finance have legacy processes that can be outsourced or automated.
The easiest way to think about where technology will be permeating institutional walls is to take a bottom-up approach. Let’s start by looking at Wall Street salaries, which are back to pre-crisis levels. Bloated salaries everywhere along The Street are simultaneously a big problem and a big opportunity for FinTech Startups.
Big problem: Startups want to hire from Wall Street, but they can't afford to poach high-earners in mainstream Finance. Wall Street pay set a new record last year, with the average salary (including bonuses) rising 14% to $404,800. Stock options don't pay the rent, and no startup board in their right mind would ever agree to guarantee anywhere near $400k in annual take-home for an unproven employee with industry expertise but no startup experience.
Big opportunity: Find the legacy jobs in Finance that don't deserve to be such high-earners and build technology solutions to lower the barriers to entry for these roles, and eventually automate the hell out of them.
So, while PMs, traders, rainmakers and the top client guys are likely safe from FinTech's reach for a while, if your job puts the "Services" in Financial Services, FinTech startups might already be coming for you.
Sales Traders, Analysts, FP&A, Middle Office, Back Office, Consultants, Attorneys...this is your warning. Any position that doesn't generate alpha for the firm - or isn't client-facing - can and will be “augmented” with, or replaced by, technology. And while technology creates lots of new jobs, the Wall Street jobs affected by tech startups will result in increased competition for these roles with fewer promotions and raises on the horizon.
So if you've ever thought about leaving your post to join a FinTech startup - or if you’re freaked out that your job is ripe for disruption - it's probably time to think about saving a good chunk of your 2016 bonus so that you can afford to join up with the FinTech startup that was putting a target on your back.
The future is here to stay. Please take it personally.
Greg Neufeld is the Founding Partner of ValueStream, a New York venture capital firm and accelerator that invests in enterprise FinTech, data and analytics software startups.