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I wonder how many people start tech companies in the financial sector these days. The market there is saturated, the competition is strong and the clients are m

by rodp 16y ago

I wonder how many people start tech companies in the financial sector these days. The market there is saturated, the competition is strong and the clients are much more conservative. OTOH, web startups can be launched with very little cash and new markets emerge every other day (social, mobile, location, etc.). Most of them fail but the ones that succeed can have potential to earn billions. Web startups are indeed a tiny part of the ecosystem but I think that's exactly the problem. We need more of them, at least in Europe.

yesno 16y ago
A similar set of properties can be applied to web startups as well: market is saturated, competition is strong, and the consumers are much more conservative than you think (unless if you happen to be in Silicon Valley). Keep in mind that the consumers of web startups have a very short attention time-span. Sometime there's a good reason why web-startups are tiny part of the European ecosystems. Even if you want to have more, the market doesn't necessarily agree with your personal point of view (I don't mean to criticize you, I'm just pointing out that there might be bias in your view)
ig1 16y ago
There are lots and lots, retail finance is conservative but investment banks are often much more willing to take a risk as are smaller hedge funds, prop shops etc. There are thousands of unexplored opportunities in the financial sector that are begging to be taken by startups. If you have a clear value proposition, then selling into the financial market is easy. This is especially true if the product you're building helps your customers make money. Every major investment bank has thousands of developers on payroll building internal systems, they'd love to just be able to buy off-the-shelf solutions that solve their problems instead. If your product is good than your customers aren't going to be worried about you going out of business, because they know someone will acquire you before that happens. They're more likely to be worried that one of their competitors will buy you. Sure you need to be more active in doing sales, but because the financial community is relatively tight-knit this is relatively easy. A lot of the time it's basically calling your old colleagues and getting them to make an introduction for you. When I left the last investment bank I was working for to start my startup, the head of the trading desk pulled me aside and said "if you're building something in our space, come and pitch us first". That's the nature of the sector, everyone wants to get the cool new tech that's going to give them the edge on the market. Banks and Financial tech firms also tend to be very active when it comes to acquisitions. It's considered a standard way to get exclusive use of a technology or to expand your firm.
_grrr 16y ago
> clients are much more conservative Not true. Financial clients spend BIG and invest often in cutting edge tech to develop & advance their quantitative trading and high frequency trading businesses. The full stack from cables to networking to application needs to be as good as it can be. Your solving problems of big data, real time and it MUST work. Financial tech people are some of THE best in the business, solving some of the most challenging problems out there. It's probably true to say that some finance institutions are practically software houses - with some of the big IB's employing more tech people than they do business function. Like others have said, there are huge opportunities in finance, but you need some serious tech to compete.
squirrel 16y ago
We did (see http://www.youdevise.com http://www.youdevise.com and https://dev.youdevise.com https://dev.youdevise.com) and we find the environment for our two product niches extremely friendly. You have to be willing to deal with the really Byzantine organisational structures of the banks, of course - I can understand why web startups would be more attractive and fun, but there really is a lot of money to be made in London finance if you figure out how to take care of the traders. If anyone would like to talk more about this please get in touch with us (or just come see me at London Hacker News events, which we sponsor).

by rodp 16y ago

yesno 16y ago

A similar set of properties can be applied to web startups as well: market is saturated, competition is strong, and the consumers are much more conservative than you think (unless if you happen to be in Silicon Valley). Keep in mind that the consumers of web startups have a very short attention time-span. Sometime there's a good reason why web-startups are tiny part of the European ecosystems. Even if you want to have more, the market doesn't necessarily agree with your personal point of view (I don't mean to criticize you, I'm just pointing out that there might be bias in your view)

ig1 16y ago

There are lots and lots, retail finance is conservative but investment banks are often much more willing to take a risk as are smaller hedge funds, prop shops etc. There are thousands of unexplored opportunities in the financial sector that are begging to be taken by startups. If you have a clear value proposition, then selling into the financial market is easy. This is especially true if the product you're building helps your customers make money. Every major investment bank has thousands of developers on payroll building internal systems, they'd love to just be able to buy off-the-shelf solutions that solve their problems instead. If your product is good than your customers aren't going to be worried about you going out of business, because they know someone will acquire you before that happens. They're more likely to be worried that one of their competitors will buy you. Sure you need to be more active in doing sales, but because the financial community is relatively tight-knit this is relatively easy. A lot of the time it's basically calling your old colleagues and getting them to make an introduction for you. When I left the last investment bank I was working for to start my startup, the head of the trading desk pulled me aside and said "if you're building something in our space, come and pitch us first". That's the nature of the sector, everyone wants to get the cool new tech that's going to give them the edge on the market. Banks and Financial tech firms also tend to be very active when it comes to acquisitions. It's considered a standard way to get exclusive use of a technology or to expand your firm.

_grrr 16y ago

> clients are much more conservative Not true. Financial clients spend BIG and invest often in cutting edge tech to develop & advance their quantitative trading and high frequency trading businesses. The full stack from cables to networking to application needs to be as good as it can be. Your solving problems of big data, real time and it MUST work. Financial tech people are some of THE best in the business, solving some of the most challenging problems out there. It's probably true to say that some finance institutions are practically software houses - with some of the big IB's employing more tech people than they do business function. Like others have said, there are huge opportunities in finance, but you need some serious tech to compete.

squirrel 16y ago

We did (see http://www.youdevise.com http://www.youdevise.com and https://dev.youdevise.com https://dev.youdevise.com) and we find the environment for our two product niches extremely friendly. You have to be willing to deal with the really Byzantine organisational structures of the banks, of course - I can understand why web startups would be more attractive and fun, but there really is a lot of money to be made in London finance if you figure out how to take care of the traders. If anyone would like to talk more about this please get in touch with us (or just come see me at London Hacker News events, which we sponsor).