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The FinTech Capital - 4th Edition

Xignite

LONDON’S FINTECH LEADERS TALK INVESTORS, START-UPS, COMMUNITIES & NEW FINTECH, TRADING TECHNOLOGY, ETRM/CTRM, BIG DATA AND OUTSOURCING VS. INSOURCING

The scene occurs at a San Francisco hipster bar in late 2014. She asks “And what do you do during the day?” He calmly says, while tucking his plaid shirt in and rubbing his fully-grown beard, “I work in a fintech startup.” “Me too,” she replies giggling. “Are you in payments or digital wealth management?”

The story draws a smile. Two years ago, few millennials in San Francisco knew what fintech (e.g. financial technology) was, but now they all see it as their ticket to fame and fortune-via-IPO. Move over social networks and micro-blogging; the next innovation frontier lies at the crossroad of Wall Street and Silicon Valley.*

Just in the month of October 2014, fintech companies in the US have raised more than $1B, including the $75M IPO of valley-veteran Yodlee, the $64M raised by digital wealth management fintech poster-child Wealthfront, and the $150M raised by payment darling Square. The capital flows and the hefty valuations don’t lie: fintech is on fire, and that fire is not only burning in the US; fintech ecosystems are flaring up in Singapore, London, Frankfurt and Paris, and many other technology centers in the world.

It was not always like this. If you tried to raise money in fintech during the years that followed the fall of Lehman Brothers, most venture capital and private equity firms would have gently pushed you out to the curb with a polite “We are not investing in fintech right now,” but today money is gushing out of their funds faster than their fledgling startups can spend it, and they are briskly updating their websites to make you believe they were in fintech all along.

So what has changed since the doom-days of finance?

The first change is economical: The markets are back in the saddle. As proof, the Dow Industrial has broken its all-time record high 79 times in 2013 and 2014 alone, and it closed on October 13, 2014 at its highest value in history. As a rising tide lifts all boats, the bubbling markets have boosted financial services and yanked financial technology in their trail. One thing that stands out in the growth of the markets is the meteoric growth of Exchange Traded Funds (ETFs)—which has exceeded every other asset class since their inception 20 years ago. Assets in ETFs now exceed 3 trillion dollars. Their inherent ease of use (as they combine the passive investment convenience of mutual funds with a level of trading ease that was previously only found in equities) could certainly explain some of the rebirth in the markets. In any case, finance is hot again. God bless America.

The second change is technological: It’s been almost 20 years since the Internet revolution began on August 9, 1995 (the day of the Netscape IPO), and technology has matured tremendously in many areas. Those concurrent evolutions have combined to create a cradle of innovation which is fueling the Fintech Fire:

  • The scaling of the public cloud (e.g., Amazon Web Services) which not only lets startups rev up on a dime, but also confers them a significant long-term cost structure advantage.
  • The maturing of app development via open source, re-usability and tools has reduced costs and timelines to hours or days. Imagine holding up a weekend-long hackathon in 1992; it just would not have worked.
  • The coming of age of social networking and search engine optimization (SEO) that have automated go-to-market strategies and slashed customer acquisition costs. With social contacts, adoption can go viral. Virality was not conceivable 10 years ago. It is not even a valid word in my spell-checker.
  • The dawn of APIs (whether used for trading via FIX or for market data consumption, as with my company Xignite) enables true end-to-end automation of processes that used to be complex and human-intensive. Fifteen years ago—without easy trading, market data and account funding APIs—digital wealth management companies like WealthfrontPersonal Capital or Betterment could not have existed.

The convergence of those trends is allowing startups everywhere to reinvent every vertical segment of financial technology with a new angle and with solutions that are easier, faster and better. This is hitting traditional financial service institutions like a high speed train. Most of them have had their heads buried in the sand focused on regulation and cost savings since the days of that infamous Lehman Brothers bankruptcy. Wall Street is now petrified that Silicon Valley is about to eat its lunch, and it is scrambling to catch up. But once you see that most large banks still twitch when one whispers the word cloud, you realize that the technology and cost advantage of the fintech revolutionaries is significant indeed. God bless APIs.

The third change is social. It has to do with a generational replacement of a population that has grown up with the Internet, surrounded by mobile devices, and used to instant gratification and levels of ease-of-use never experienced by humanity before. That generation could not care less about traditional investment and advice models. They would not think twice about banking with Google, Starbucks or Facebook if it were available. They are not worried about security on the Internet, and the last thing they want is to have to talk with someone to get anything done. They are ready to use Siri to place a trade and expect an investment account to open and be funded instantly.

According to a survey conducted by eTrade, the majority (72%) of millennials want a financial advisor like R2-D2— “a copilot with diverse skills who helps you when you need it and offers a variety of tools you can use yourself.” Only 28% of them are looking for a friend like C-3PO (i.e., “a constant companion focused on your money who will always tell you what to do”).  If you are betting that millennials will reverse their habits to that of their parents once they hit the age of 40, you may lose.

One may look at the mortgage crisis and think that because of it, financial services will never be the same. But the impact of the financial mortgage crisis is negligible compared to what millennials will have on the industry as they grow up. God bless our children.

So the fintech fire is being fueled by three deep-seated technological, social and economic transformations that are catalyzing to create an innovation bonanza that is turning the industry upside down. Of the three, only the first one is cyclical, and even if a bear market could put a cold shower on the whole phenomenon, the lasting characteristics of the two other trends allow us to safely predict that financial services and financial technology will never be the same.

* Technically a bit north of that, since Wall Street is now lined-up with condos and neglected for hip neighborhoods uptown by New York startups, and since Silicon Valley has been displaced by San Francisco as the startup capital of the world.

Stephane Dubois is CEO and founder of Xignite and a sought-after observer and contributor to the fintech community.

Source: The Harrington Star

RECENT NEWS

By Max Bowie - Waters Technology

NICE Actimize has fortified the datasets available for use in its Surveil-X trade surveillance tool, using exchange prices and other data from Swiss vendor SIX, delivered via Xignite’s new suite of microservices for content distribution and data management.

The vendor is preparing to go live with the joint solution “any day now,” after completing some final data validation, says Sam Sundera, head of future business at SIX, who is based in the San Francisco Bay Area, and is responsible for dealing with partners, new technology data and initiatives, and with banks’ innovation labs.

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07/23/2020

The Two Companies Deliver Industry’s Largest Global Coverage Sourced from 1,800+ Trading Venues Via Hyper-Scalable Cloud APIs

Xignite, Inc., a provider of market data distribution and management solutions for financial services and technology companies, and SIX, today announced a strategic partnership. Xignite and SIX are now offering real-time data from the catalog of SIX which includes 1,800+ global exchanges and trading venues via Xignite Enterprise Microservices, a suite of cloud-native market data management services built to transform how firms store, distribute, manage, and control market data in the cloud. The partnership accelerates the transition of large financial institutions and fintechs to the cloud. This is the first time such a comprehensive set of market data has been offered to the market via a native cloud solution.

Xignite’s battle-tested cloud-native solution currently serves more than 12 billion API calls per day to 750 clients around the world--making it the largest cloud API platform in capital markets. Xignite recently introduced Xignite Enterprise Microservices, a suite of vendor-agnostic services large firms can deploy to migrate their market data infrastructure and any of their existing data sources to the cloud.

“Large financial institutions have been looking for cloud-native market data solutions capable of handling their broad coverage requirements and offering a state-of-the-art customer experience.” says Stephane Dubois, CEO and founder of Xignite. “The pandemic has worsened the situation as firms want to get away from maintaining complex and expensive on-premise infrastructures that are overkill for most of their needs,” added Dubois. “We had the enterprise technology but not the coverage, so partnering with SIX made sense. We are thrilled to partner with SIX and be first to market with a true global enterprise solution.” 

SIX is one of the few market data vendors offering full coverage of the global capital markets. The Market Data Feed (MDF) from SIX delivers a steady stream of global market information that is consolidated, standardized and in real time. With MDF clients get access to over 30 million instruments across all asset classes and from more than 1,800 exchanges, OTC markets, and other trading venues. The combined solution integrates the MDF feed from SIX delivered from hosted collocation facilities to Xignite Enterprise Microservices deployed in the client’s own cloud account. The Xignite Real-Time Microservice is used to distribute real-time data internally or externally from the cloud via scalable APIs while the Xignite Entitlements and Usage Microservice provides control and transparency of data consumption and usage.

“Partnering with Xignite is a great leap for SIX in making its market data easily available to all buy-side and sell-side professionals. While making the richness, depth and wide coverage of our Market Data Feed available via Xignite’s cloud-based solution, we offer clients streamlined access to the highest quality data without a complicated acquisition process, burdensome integration or costly development,” commented John McManus, Head Sales, Financial Information, SIX.

About Xignite

Xignite Makes Market Data Easy. Xignite is leading the disruption of the market data industry with its AWS-based financial data distribution and market data management solutions. Xignite’s Market Data Cloud platform provides market data managers full transparency on the usage of a firm's first-level real-time and reference data - making it easy for data owners to entitle, control consumption, comply with licensing requirements, allocate costs, and resolve vendor audits or invoice discrepancies. Xignite also powers financial data-driven robo-advisors, online brokerages, and investing apps with its real-time, delayed, and historical pricing data offered via 500+ REST Cloud APIs. Visit http://www.xignite.com or follow on Twitter @xignite.

About SIX

SIX operates and develops infrastructure services in the Securities & Exchanges, Banking Services and Financial Information business units with the aim of raising efficiency, quality, and innovative capacity across the entire value chain of the Swiss financial center. The company is owned by its users (122 banks). With a workforce of some 2,600 employees and a presence in 20 countries, it generated operating income of CHF 1.13 billion and Group net profit of CHF 120.5 million in 2019.
 www.six-group.com

07/23/2020

Xignite, Inc., a provider of market data distribution and management solutions for financial services and technology companies, announced today it has created a new program to assist early stage and start-up financial technology companies during the COVID-19 pandemic. To apply for this program visit https://www.xignite.com/fintech-development-program/

The costs associated with developing and launching fintech products and apps can be daunting, even in the best of times. A particularly challenging aspect can be the procurement of quality financial and market data. Hidden fees, restrictions on the use of data, poorly written APIs and exchange requirements are just some of the factors, in addition to costs, that can make it difficult for new or small fintechs to survive.

To assist early stage fintech companies, Xignite is inviting these disruptors to leverage the same technology and data APIs that have helped move the industry forward over the last decade. Through this program, companies can continue to develop their ideas and products without a significant capital commitment. Participants will be able to take advantage of development access for 60 days on Xignite’s most popular financial data APIs and enjoy significant discounts on fees for the first year. Also included in the program is access to real-time, 15-minute delayed and end-of-day stock prices, company data, currency exchange rates, indices, corporate actions and master data.

“Not only are we offering a compelling financial incentive, but companies will have access to the experts on our Product and Engineering team who not only first brought financial market data to the cloud, but also helped support and power some of the biggest disruptors in the industry such as SoFi, Robinhood and Betterment,” said Ryan Burdick, Senior Vice President and Global Head of Sales at Xignite. “By introducing this program, Xignite is able to support the next wave of entrepreneurs by helping to keep their visions moving forward as seamlessly as possible during this unprecedented time.”

About Xignite

Xignite Makes Market Data Easy. Xignite is leading the disruption of the market data industry with its AWS-based financial data distribution and market data management solutions. Xignite’s Market Data Cloud Platform provides market data managers full transparency on the usage of a firm's first-level real-time and reference data - making it easy for data owners to entitle, control consumption, comply with licensing requirements, allocate costs, and resolve vendor audits or invoice discrepancies. Xignite also powers financial data-driven robo-advisors, online brokerages, and investing apps with its real-time, delayed and historical pricing data offered via 500+ REST Cloud APIs. Visit http://www.xignite.com or follow on Twitter @xignite.

07/14/2020

NICE Actimize Gains Agility and Scalability Bringing its Real-time Market Data Infrastructure to the Cloud

Xignite, Inc., a provider of market data distribution and management solutions for financial services and technology companies, today announced the launch of Xignite Enterprise Microservices, a powerful suite of cloud-native market data management services built to transform how firms store, distribute, manage and control market and financial data in the cloud. NICE Actimize, the leading global provider of financial crime, risk and compliance solutions is the first user of the new Real-time Microservice solution.

Microservices are an architectural approach in which core functionality is handled by loosely coupled, independently deployable components that can work together or separately. Because you can deploy microservices as separate functional units, you can pick and choose the functionality you want and scale them massively at the lowest possible cost. Microservices stand in stark contrast with monolithic platforms that require many dedicated on-premise servers which are expensive to manage, often under-utilized, can’t scale on-demand and require frequent updates and upgrades for even minor changes. Most enterprise platforms also require firms to pay for capabilities that are not needed.

The Xignite Enterprise Microservices run on Xignite’s battle-tested cloud-based architecture that currently supports more than 250 different data sources and 12 billion API calls per day for over 750 fintech and financial services clients. Financial institutions can now leverage the same cloud technology Xignite has been refining and scaling for more than 10 years to move their own financial and market data to the cloud. Xignite’s microservices are built from the ground up for the cloud, in contrast with legacy data providers that are attempting to “lift and shift” their monolithic platforms for that purpose.       

Xignite Enterprise Microservices are vendor-agnostic and can bring transformative results to any data set a firm may license or collect from vendors such Bloomberg, FactSet, ICE Data Services, SIX Financial, Vela Trading, QuantHouse and many others, as well as in-house proprietary data.

“We are incredibly excited to launch Xignite Enterprise Microservices, which we believe will truly revolutionize market data management,” said Stephane Dubois, Founder and CEO of Xignite. “The culmination of over 10 years of nonstop innovation, we have taken the cloud-native architecture that has powered some of world’s most prominent fintechs and scaled it to meet the unique requirements of institutional players that consume huge amounts of data but often have no way of integrating and optimizing it in an efficient and cost-effective way. Firms are no longer required to hitch their wagon to a single provider – instead, they can use a combination of our microservices to secure all the benefits they would get from a rigid legacy offering. We are the only vendor offering a suite of market data management microservices that clients can mix and match to create a comprehensive, infinitely scalable cloud-based solution that meets their exact needs. We firmly believe that offerings like these are the future of market data, and we are thrilled to once again take a leading role in the financial services industry’s continued digital transformation.”

The suite includes seven cloud-native microservices targeted to buy-side, sell-side and fintech firms, as well as exchanges:

  • Xignite Data Lake Microservice is a cloud-native data management and distribution solution that centralizes existing data and enables financial services firms to provide easy access to the data via highly scalable cloud APIs, reducing costs and improving efficiency by eliminating legacy infrastructure.
  • Xignite Optimization Microservice is a cloud-native pricing and reference data cost optimization solution that enables the control of large reference data sets, such as Bloomberg Data License, via intelligent caching, sophisticated entitlements and advanced analytics and reporting.
  • Xignite Entitlements and Usage Microservice is a cloud-native market data access control and reporting solution that enables financial services firms to have complete control and transparency of data consumption and usage, and provides reports of data usage across various data sets, users and applications to ensure vendor compliance.
  • Xignite Reference Microservice is a cloud-native solution that aggregates, normalizes, stores and indexes reference data from multiple vendors across all asset classes into a centralized repository and access layer, enabling centralized access across the entire enterprise and improving data consistency, completeness and timeliness.
  • Xignite Historical Microservice is a cloud-native time-series data management solution that enables financial services firms to capture historical data from different sources and integrate with security master and corporate actions data to provide a fully normalized, stitched and adjusted historical data view via highly scalable cloud APIs.
  • Xignite Real-Time Microservice is a cloud-native real-time data distribution solution that enables financial services firms to distribute real-time data internally and externally via highly scalable and flexible cloud APIs, eliminating on-premise infrastructure.
  • Xignite Fundamentals Microservice is a cloud-native data management solution that enables financial services firms to capture simple or complex time-series data structures associated with an entity such as a regional level security or issuer, and make them available via specialized and highly scalable cloud APIs.

These microservices are already transforming how the industry manages data. NICE Actimize, a leading provider of financial crime management solutions, has replaced its legacy solution with the Xignite Real-Time Microservice to onboard and manage multi-asset class, level 1 and 2 co-located feeds from multiple sources.

The launch of Xignite Enterprise Microservices is the latest highlight in what has been a hugely successful year for the firm. Last month, Xignite received a patent for its alerts technology and the company was named a SIIA CODiE Awards finalist and added to the WealthTech 100 list.

About Xignite
Xignite Makes Market Data Easy. Xignite is leading the disruption of the market data industry with its AWS-based financial data distribution and market data management solutions. Xignite’s Market Data Cloud platform provides market data managers full transparency on the usage of a firm's first-level real-time and reference data - making it easy for data owners to entitle, control consumption, comply with licensing requirements, allocate costs, and resolve vendor audits or invoice discrepancies. Xignite also powers financial data-driven robo-advisors, online brokerages, and investing apps with its real-time, delayed and historical pricing data offered via 500+ REST Cloud APIs. Visit http://www.xignite.com or follow on Twitter @xignite.

07/08/2020