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Financial services organisations started shifting from denial to action in 2015.

Xignite

Q&A with Stephane Dubois, Founder and CEO, Xignite Inc.

Please give us a bit of background on yourself, and how your organisation plays a leadership role in the financial technology space.

I started Xignite more than 10 years ago after a 20 year career in Silicon Valley around enterprise software (Oracle) and investment management software (Advent Software). I fell into the data business when trying to build a wealth management platform and running into much pain and complexity trying to source and integrate financial market data into our application. To us, using XML APIs to deliver data seemed like the natural thing to do back then. Little did we know that we were quite a bit ahead of our time. We actually launched the first commercial pure-play API ever--again, without realising it.

Because we were so early with our easy to use REST APIs, fintech companies naturally picked us when they started their journey towards revolutionising financial services. This happened around 2008-2012, way before the Fintech Revolution started (circa late 2013 according to Google Trends). We solved a real problem for them. Legacy market data feeds were truly cumbersome and by using our APIs they could preserve their hard-raised capital and focus on innovation. And they did. We made market data simple for them. With a few lines of code they could start feeding data into their new robo-advisor platform or next generation lending solutions. They had no feeds or files to process and no infrastructure to build and maintain at high cost. So while we have not ourselves tried to revolutionise the world of payment, lending, trading or asset management, we have played a key role enabling the leaders in those fields - such as Betterment, Wealthfront, Robinhood, Square and OnDeck - innovate and reshape the world of financial services.

How well are financial companies adapting to the rapid pace of fintech development? What fields are furthest ahead of the game, and what sectors are being left behind?

Financial services organisations started shifting from denial to action in 2015. At first, many were just dismissive of the phenomenon. Then there was a wave of recognition that the threat was real, epitomised by Jamie Dimon's famous "Silicon Valley is coming" in his 2015 letter to JP Morgan's shareholders. Many financial institutions started buying fintech companies--most of which were our clients; BlackRock bought FutureAdvisor, Invesco bought JemStep and there were many others. Others--like JP Morgan--started to organise themselves as fintech companies.

In all fintech segments, you will find firms that are ahead of the game and some firms that are way behind. Just like you will find some locales are more advanced than others. What is most important is how deep the transformation is. This is not about small improvements. This is about changing some major assumptions regarding how firms operate and serve their customers. Advice for example, was something that the industry believed was rooted in personal relationships. Robo-advisors challenged that assumption forever and the financial advice industry will never be the same as a result. We see it in our field as well. We used to find financial services organisations rejecting the public Cloud and dismissive of APIs as "toys". Now many are engaging aggressively in order to build a transition path to using the Cloud for market data. They have realised they can no longer afford to forego the cost savings and innovation power that the market data cloud affords them.

What challenges do you see for fintech development and disruption, both from a user's perspective and from a regulatory standpoint?

While many firms sprouted up in all segments of the industry, the cold hard truth is that few will survive. And this will have little to do with users and with regulation. It has nothing to do with fintech per se and everything to do with how market expansion in new technology segments works. We have seen that over and over for 30 years now. This pattern could change, of course, but that is unlikely. This is how it works. New technologies and business models converge and come into the light. Entrepreneurs iterate and pivot around with this technology and business models until a new category is created and understood by all (e.g. Robo-Advisors). Once the category exists, one company will emerge as the leader and a few as challengers. Those companies stand a chance to standalone (i.e. IPO) as the market expands. Everyone else fails or gets acquired by other players.

It is true that fintech companies have benefited from a very limited regulatory landscape compared to their legacy peers. It is also true that it was excessive regulation imposed after the mortgage crisis that made it possible for the fintech revolution to emerge. The reason is that large banks got so busy with regulation that they forgot to innovate. They forgot they had clients.  So the world ahead of us will be more balanced: more regulation for fintech and less regulation for the banks in a post-Trump era. This again probably means that only the strongest will survive as independent businesses. But the technology and legacy of fintech will forever impact the industry.

What impact do you think Brexit will have on the broader financial technology industry in the UK?
The impact of Brexit is already felt by fintech. A recent report from CB Insights indicated that Germany overtook the UK for fintech funding in Q3. But I think that those shifts are more due to uncertainty than to actual concerns that the UK will lose its power position in the world of finance. We are ourselves looking into opening an EMEA office in 2017 and we are still going to do it in London due to the critical mass of fintech and finserv firms in the UK. The UK is easily our second largest market. Can a finance-savvy but standalone UK hold up against a unified but amateurish Europe? Time will tell.

How is API technology changing the financial services industry?

Financial services used to be a world of silos. For generations banks have grown up as protective ivory towers of redundant technology, legacy processes and complacency. The amount of regulation imposed on them over the years did not make things better. Sure, some industry exchange standards emerged over the years (SWIFT, ACH) but they were just as bloated and complicated as the industry itself. This completely stifled innovation. But banks are just data processing companies. The physical relationship with clients does not matter as much any longer, even with wealthy clients. APIs are a simple protocol that make exchange of information and transactions simple. It challenges the industry to its core. They must embrace it or crumble under the weight of their inner complexities and costs. We have seen it in our domain where banks used to love spending hundreds of millions of dollars on on-premise legacy market data technology that brought them little competitive advantage. Now they are coming to us saying "we are going to use APIs for this project". The reason is simple: the cost advantage and simplicity of Cloud APIs is just too compelling to be ignored.

What’s next for APIs in the financial services industry?

APIs is a very diverse ecosystem. There are many types of APIs and each will have a different impact on the industry. APIs are being used internally by banks to drive efficiencies and interoperability. That trend is here to stay and it will dramatically reduce operational costs for banks in the long term as well as fuel their ability innovate. Many banks are now dabbling with Open APIs which are allowing them to create innovation ecosystem around them--although a lot of that effort remains unfocused. Few banks except for challenger banks are actually providing API products so there is much to be done and discovered in this area. Where we see a lot of potential in the next three years is for banks to start becoming broad consumers of APIs provided by third parties. The Public Cloud will be the main beneficiary of this trend for sure, as billions of dollars in IT spending move from on premise deployment to consumption as an API. Market data--our domain--will also see a massive migration from on premise to API consumption as firms seek to migrate a lot of their legacy market data infrastructure to the cloud. Because of its scale, the public cloud is where all innovation will happen in the next few years. On-premise will fall behind not only in terms of costs, but in terms of availability of cutting edge technology--which will all be available via APIs.

What will you be discussing at The Economist's Finance Disrupted Conference on January 25th 2017 in London?

My focus for the conference will be to talk about the next generation of innovation around financial market data in the Cloud.

To learn more about the Finance Disrupted event, please click here.

RECENT NEWS

Xignite, Inc., a provider of market data distribution and management solutions for financial services and technology companies, today revealed the results of its collaboration with StockCharts, a leading technical analysis and financial charting platform for online retail investors. The collaboration involved a move from an on-premise market data provider to Xignite’s cloud-native technology hosted in Amazon Web Services (AWS). Download the case study containing the full results.

StockCharts requires vast quantities of financial data to power its visualization, charting and tracking tools, which investors use to analyze the markets to help with investment decisions. The company was frustrated by the limits of its on-premise market data center, which was forcing the team to make architectural decisions based on what its data center could handle in terms of speed and storage, not on their technology. Its previous market data provider was just starting to build out some cloud offerings, but they were far away from what the business required. StockCharts decided to migrate its infrastructure to the AWS cloud and partner with Xignite to gain access to endlessly scalable market and financial data delivered through innovative cloud APIs.

The collaboration made an immediate impact as StockCharts was able to expand its offerings and customer base by pursuing growth strategies enabled by Xignite’s cloud-based approach, which provides easy access to data and eliminates architectural limits on storage and speed.

The pandemic provided further validation. Seattle-based StockCharts was in one of the first areas hit by COVID-19 and was forced to quickly shut down its office. Pandemic-driven market volatility followed and StockCharts customers wanted to visualize what was happening. The company’s ability to scale quickly and accommodate a high volume of new requests would not have been possible without Xignite.

“The move to the AWS cloud and Xignite has unlocked tremendous new potential for us in a lot of architectural ways, and has given us a lot of data options that we could not even consider before,” said Grayson Roze, Vice President of Operations at StockCharts. “It relieved us of the burden of figuring out how to source things. Instead, we know exactly where we need to go to get the data and can access it instantly. That is a huge, huge benefit for our business.”

“We are proud to have played a role in transforming how StockCharts approaches data,” said Stephane Dubois, CEO and Founder of Xignite. “The events of this year unleashed a massive spike in retail trading and a host of other unexpected forces that reinforced the need for financial services firms to leverage the cloud. Despite the disruption of this year, StockCharts was positioned for success, and we look forward to continuing to deliver our financial and market data solutions to the industry at large.”

Xignite

Xignite has been disrupting the financial and market data industry from its Silicon Valley headquarters since 2006 when it introduced the first commercial REST API. Since then, Xignite has been continually refining its technology to help fintech and financial institutions get the most value from their data. Today, more than 700 clients access over 500 cloud-native APIs and leverage a suite of specialized microservices-delivered modules to build efficient and cost-effective enterprise data management solutions. Visit http://www.xignite.com or follow on Twitter @xignite

01/12/2021

Xignite, Inc., a provider of cloud-based market data distribution and management solutions for financial services and technology companies, today announced that its Market Data Management-as-a-Service solution has been named “Best New Technology Introduced over the last 12 months – Infrastructure” at the 2020 WatersTechnology American Financial Technology Awards (AFTAs). Selected by the editors of WatersTechnology, the AFTAs recognize excellence in the deployment and management of financial technology within the asset management and investment banking communities.

Xignite’s Market Data Management-as-a-Service (MDMaaS) solution enables buy- and sell-side firms to centralize the management of vendor data feeds into their own cloud environment. The solution is built around the cloud microservice-based architecture and technology stack Xignite has been refining and scaling for more than 10 years. Xignite’s technology platform has been the backbone of the company’s Data-as-a-Service business, daily supporting 12 billion API requests of financial data for their 700 fintech and financial services clients. Now Xignite is leveraging this battle-tested cloud-native data management architecture to offer buy- and sell-side firms a market data vendor agnostic offering, with connectors available for firms to load data they license from Bloomberg, Refinitiv, ICE and numerous other providers.

The MDMaaS solution includes a suite of loosely-coupled modules that enable market data user firms to control their data usage, automate entitlements, optimize their data spend and minimize liabilities by simplifying data governance and ensuring regulatory compliance.

The functionality is delivered via microservices, an architectural approach in which core functionality is handled by loosely coupled, independently deployable modules that can work together or separately. Microservices architecture stands in stark contrast with monolithic platforms that require expensive on-premise technology – that is especially hard to maintain in the context of a pandemic.

The MDMaaS microservice-delivered modules introduced in 2020 include:

Xignite Entitlements and Usage - Manage the entitlement of vendor data to users and applications to ensure compliance and eliminate excess spend.

Xignite Optimization - Streamline data consumption to avoid duplicated vendor requests, leverage cached bulk data and get recommendations to reduce data costs.

Xignite Data Lake - Centralize, catalog and connect data shapes to enable frictionless integration by consumers via unified cloud APIs.

Xignite Reference - Aggregate, normalize, store and index vendor reference data to centralize enterprise-wide access.

Xignite Historical - Provide centralized access to normalized, stitched and adjusted historical data via cloud APIs.

Xignite Real-Time - Distribute real-time vendor data via cloud APIs, eliminating on-premise infrastructure.

Xignite Fundamentals - Make simple and complex time-series data structures available via cloud APIs.

“Xignite has pioneered market data in the cloud for more than 10 years now, so we are very excited to announce – and be recognized for – our Market Data Management-as-a-Service solution,” said Stephane Dubois, CEO, and founder of Xignite. “The pandemic has reinforced the need for financial services firms to migrate to the cloud as a means of navigating disruption and enabling scalability, among other benefits. We are proud to spearhead that effort and help the industry modernize its approach to financial and market data.”

About Xignite

Xignite has been disrupting the financial and market data industry from its Silicon Valley headquarters since 2006 when it introduced the first commercial REST API. Since then, Xignite has been continually refining its technology to help fintech and financial institutions get the most value from their data via its Data-as-a-Service and Market Data Management-as-a-Service solutions. Today, more than 700 clients access over 500 cloud-native APIs and leverage a suite of specialized microservices to build efficient and cost-effective enterprise data management solutions. Visit http://www.xignite.com or follow on Twitter @xignite

01/06/2021

Read the entire article at Business Insider

The Department of Justice has officially sued Visa to block its $5.3 billion acquisition of Plaid — and the fintech world is scrutinizing what this might mean for the industry.

Business Insider spoke with Xignite's CEO and Founder Stephane Dubois, and other legal and industry experts on how they see the DoJ's lawsuit shaking out — and what this means for the fintech world.

If the Justice Department wins in court, the merger could be scuttled
Stephane Dubois, the CEO of financial data provider Xignite, thinks that the fact that the DOJ sued suggests that it does probably have a solid legal basis for its allegations.

Unless Visa — which has been represented by powerhouse law firm Skadden in connection with the deal — can fight the DOJ's lawsuit on a legal basis and argue successfully that the government's argument is too speculative, that they're not anticompetitive, he doesn't think the acquisition will go through.

Otherwise, Visa would need to comply with conditions set by the DOJ — for example, lower fees on credit cards, or breaking up its business — to make itself non-competitive. But he's not sure if Visa would be willing to do that.

Dubois said such a lawsuit could be a "cold shower" for fintechs that are considering mergers and acquisitions given the massive $200 million Plaid paid for its API competitor, Quovo, in January 2019, not to mention the $5.3 billion price tag of Visa's acquisition of Plaid.

The DOJ's lawsuit could fail and Visa's acquisition could go through, but with diverging possible outcomes for Plaid and other fintechs

Dubois sees several possible outcomes playing out should the DOJ's lawsuit fail. The acquisition would go through and Visa could continue to make Plaid available to fintechs, but in a way that it doesn't "cannibalize" its own business — for example, by charging 3% fees to competitor services that Plaid enables.

It's also possible that Visa shuts down Plaid after a successful acquisition, essentially squashing competition for the market, something Dubois called a "worst case scenario."

11/05/2020

Yugabyte, the leader in open-source distributed SQL databases, today announced that market data distribution and management solutions provider Xignite has selected YugabyteDB as its database of choice to power its cloud-native financial data distribution and management solutions. Xignite selected Yugabyte’s distributed SQL database based on YugabyteDB’s high performance, on-demand scalability, and operational ease. 

“Due to the nature of our business, performance and scalability are the two most important factors we look for in a database solution,” said Dr. Qin Yu, VP of Engineering, Xignite. “Financial data is ever-changing and we need to capitalize on that data to give our customers the most accurate, real-time view of the markets. The performance and scalability of YugabyteDB allows us to provide granular data in real-time to our high-profile clientele, combined with the Yugabyte Platform, which greatly simplifies operations and management. In addition, we have come to rely on the Yugabyte as key partners, providing us with a best-in-class distributed SQL platform and support.”  

Xignite provides customers with a scalable way to manage, control, and optimize real-time and reference data across traditional systems and cloud applications. It does this through its cloud-native market data platform that unifies financial data consumption and market data management—delivering clients a real-time view of market activity as a service via the cloud. However, serving financial services and fintech customers like Robinhood, SoFi, Investopedia, and BlackRock requires scaling as their data requirements change and grow, while still providing the high availability and high performance they need and expect.  

“When you’re building a leading market data management platform like Xignte, data accuracy and availability are absolutely imperative,'' said Karthik Raganathan, CTO and Co-Founder, Yugabyte. “Making sure customers have always-on access to real-time and reference data in a market with high–and continuously growing–volumes, sources, and types of data puts extensive demands on the scalability and performance of a database and the teams that support it. We are thrilled to be a partner to Xignite, eliminating their database pain points and enabling the Xignite team to invest more time and money in building new features for their customers.” 

As Xignite’s business grows, so does the amount and granularity of data, creating the need to quickly scale the database tier. Scaling Microsoft SQL Server on AWS with Amazon RDS was very challenging, requiring manual partitioning of data at the application layer, which was time-consuming and increased complexity. After trying MySQL and considering NoSQL solutions, Xiginite turned to Yugabyte to address its need for a database provider that could easily scale on-demand, future-proofing the company for continued growth. Yugabyte has seamlessly handled Xignite’s performance requirements for both reads and writes, and enabled the company to add capacity and scale quickly, with operational ease and no downtime.

Moving to YugabyteDB has enabled Xignite to scale to more than 11 terabytes of data, unlock new use cases that would not have been possible with the older technology stack, and achieve an overall cost savings of approximately 50% compared to SQL Server.

For further information on Xignite’s work with Yugabyte visit www.yugabyte.com/success-stories/xignite/

About Yugabyte
Yugabyte is the company behind YugabyteDB, the open source, high-performance distributed SQL database for building global, internet-scale applications. YugabyteDB serves business-critical applications with SQL query flexibility, high performance and cloud native agility, thus allowing enterprises to focus on business growth instead of complex data infrastructure management. It is trusted by companies in cybersecurity, financial markets, IoT, retail and e-commerce verticals. Founded in 2016 by former Facebook and Oracle engineers, Yugabyte is backed by Lightspeed Venture Partners and Dell Technologies Capital. www.yugabyte.com.

11/05/2020