Tag Archives: Financial Services

Sincerity and Authenticity in Social Media


As a panelist at a FinanceConnect conference sponsored by LinkedIn in New York last week, I found myself referring, unexpectedly, to a 40-year-old series of lectures delivered by the late Professor Lionel Trilling to frame the challenge the financial services industry faces in harnessing the power, and the potential, of social media.

“Sincerity and Authenticity” is the title of an obscure book based on Trilling’s 1970 lectures at Harvard University, as the Charles Eliot Norton Professor of Poetry. Trilling’s premise was that Western society has gradually evolved away from a construct of morality he calls “sincerity” to a formulation of morality more admired and respected in the modern era, which he terms “authenticity.” Trilling doesn’t do enough to help his readers understand the difference between the two words: but I’ve always visualized the difference by contrasting my mother and my mother-in-law. My mother was “authentic”: an artist, daughter of a world-class narcissist, a recovering alcoholic, suffering from anxiety and depression all her life, possibly the most eccentric person I have ever known (living alone on a farm in rural Georgia with 100 goats, llamas, miniature horses, basset hounds, roosters, Vietnamese pot-bellied pigs), but absolutely committed to being true to herself, no matter what others thought of her. My mother-in-law, on the other hand, is quintessentially “sincere” (in Trilling’s terms): a Midwestern matriarch, traditionally social, active in her community, fiercely family-focused, insisting always on presenting the best possible “buck up” face to the world no matter how she felt or what was going on inside her family.

Authenticity is about being true to oneself (even at the expense of social connection). Sincerity is about connecting with others (even at the expense of personal truth).

What does this have to do with Finance?

What does it have to do with social media, for that matter?

In the wake of the financial crisis of 2008-2009, investors and other consumers of financial services care a great deal about “authenticity.” Increasingly, they are screening the individuals and firms they work with through the lens of whether those service providers have values that align with their own, and whether their behavior is consistent with their values.

Authenticity, today, is a differentiator. That’s true in business generally; but it’s particularly true in financial services… because authenticity has a lot to do with rebuilding and maintaining the trust that was damaged by and in the financial crisis.

Investors and consumers of financial services are also communicating and transacting more than ever before through digital channels, including social networks, although regulatory constraints continue to limit the ability of financial firms to communicate digitally with their clients as much as their clients would like.

The challenge is this: How do you convey or project authenticity through social media channels? How do you project a commitment to being “true to yourself” through channels which are all about connecting, being social, having as many “followers” or “connections” as possible.

Traditional literature is filled with characters who are “authentic”—Holden Caulfield from “Catcher in the Rye” comes to mind—but who wouldn’t come across very well to potential followers in the age of social media. Introspection and speaking one’s truth in isolation don’t translate well into brand value in a digital age.

My LinkedIn panel was only able to address this question in a limited manner…. But we did conclude that in order to convey “authenticity” through social media, one’s message and intellectual content need to be about helping others —whether by teaching, informing, enabling, inspiring—rather than about self-promotion.

Being authentically sincere—connecting with others out of a corporate mission and sense of purpose that is all about helping others—that’s how to differentiate in social media channels.

Another way to put this is that both authenticity (personal truth) and sincerity (caring about and connecting with others) are required to build the kind of social media brand customers and clients are looking for these days.

Photo: scyther5 / shutterstock

Posted by:John Taft

We Have the Power Within to Build the World Anew


As Carlotta Perez has very thoroughly explored in her treatise: Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages, a new common sense emerges from the beginnings of each socio-economic cycle to the end where the establishment embraces the new technology and it remakes the world. Every day across multiple sectors, we are tracking that new common sense at EntrepreneurCountry. Our Forum on the 20 of March will talk about three areas of disruption: digital currency, the maker revolution and Internet of Things.

The United Kingdom, where I live, receives a disproportionately high amount of the global venture capital allocated to backing fintech start-ups. The UK is good at financial services. The corollary is that you have a lot of entrepreneurs going after the existing financial services industry to smash it to pieces, and remake of it an entirely new financial services ecosystem.

There are at least three versions of the future which we may witness unfold:

  • Without question, there is one version of the future where the technology platform firms (Apple, Facebook, Google, etc) take over the banking & financial services industries
  • There’s another version of the future where Digital Davids disrupt financial services players and build the new financial services industry (Wonga, Zopa, Nutmeg etc)
  • There’s yet a third version of the future where David hops on the back of Goliath, exploits the niches where the Goliaths don’t want the business, sell in a white label product, develops markets that they don’t yet see, or leverages their distribution and brings them new digital revenue streams.

If we assess these in turn:

The tech firms understand Kurzweil’s Singularity is Near starting point that the world has gone network. Technology operates exponentially, not linearly. Their advantage as a platform company is that they have less regulation, take advantage of others’ investments in infrastructure and by creating clear economics, the applications want to run over their anthill as everyone knows who gets what.

The Digital Davids who are exploiting massive market ops which the banks and other financial services players have left open, who have raised capital effectively, created brands successfully on the back of trust and value prop also exploit network effects due to the exponential nature of technology. They can do more with less.

The Goliaths must migrate to become platform businesses. This is tough as they have the regulation, infrastructure investment and other legacy issues to deal with, but they also have huge advantages – customers, brand, trust, staying power, global reach. They can be a highway for Digital David’s who need that scale, reach, distribution. They have to shift their thinking however from supplier-centred to consumer centred, from linear to network, from the R&D lab to the market. They can’t assume they drive the timeframe of the changes that will occur, but the opportunity for them to organize a set of economics for their industry is real. Unless they can use technology to open themselves up as much as possible (cloud, mobile, data aware) to be the highway, to be the anthill, they won’t get the new revenues that the Davids can bring which are additive to the P&L, but they will get stuck with the costs in terms of time dealing with regulation and investment. Lose Lose.

The challenge for every CEO is to reimagine their industry as an ecosystem. To ask themselves – who are my natural allies and how do I make it in their interest to help me to achieve the market position that I seek to own. Those who do that thinking, create those incentives, ultimately have a fair shot at creating the economics for their ecosystem. We think it’s pretty clear that the winners in this next phase will be those companies who organise the economics for their ecosystems. We call that Ecosystem Economics™, and I advise and invest around the framework below: helping Davids and Goliaths achieve those network effects that the landscape offers up to them when they apply a disruptive economics framework to it.

Monitise, a company that Ariadne advised from post-MVP in 2004, to end of 2012 when its market cap was nearing $1 billion, perfectly exemplifies what we mean by Ecosystem Economics™. They moved from the lower left side of the grid to the upper right lock in position over a decade. The founder/ CEO Alastair Lukies made a very simple but profound statement many years ago: “if this (the mobile money world) is going to work, it has to work for everyone”. And he crafted the rails and the economics of making it in the interests of his natural allies for them to pull him into the market.

Carlotta Perez believes that disruptive technologies appear only once in the 60 to 80 year cycle: at the beginning. So the arrival of digital currencies like Bitcoin may signal the arrival of the next cycle, or might be the culmination of the new common sense emerged at the end of this cycle depending on you view things, and what weight you give to them.

There’s a lot of work to do to make the infrastructure of the digital currency a reality, but it would take a hardened cynic to believe that bitcoin doesn’t have tremendous momentum today that will enable it to play a role in the future of money somehow.

As a fierce defender of market-based economics (precisely because I believe that they protect/defence/enhance all of our abilities to drive economics for ourselves), I lean into the bitcoin opportunity.

I will be speaking about that with some world experts such as Carol Realini at the next EntrepreneurCountry Forum on the 20 of March at the Royal Institution of Great Britain. For more details about our forthcoming event click here.

Photo: Shutterstock

Posted by:Julie Meyer

We are Founders, and We are Afraid.


As a founder, fear never really leaves, it simply evolves. When we first conceive our ideas—the only fear that exists is that we may never act on them—that we might not take the time to focus, launch our site, and pursue our dream. It’s a fear. But compared to the ones that follow it’s a manageable one.

Once we take the leap, we tell our friends, and we quit our job, the fears begin to pile up. What if no one likes the product? What if we never get users? Don’t get press? What if no one gets it or is willing to pay? What if we can’t get another job? What if we can’t raise capital?

And at that point all we want is to raise Venture Capital. Everyone is saying we should bootstrap but they haven’t been crashing on a couch for 1.5 months and eating mac n cheese or peanut butter and maple syrup sandwiches for every meal. They can afford to pay for the one-month unlimited card on the NYC subway and they receive a check in the mail every other week, which helps them pay rent. They can take a cab home when it gets late—and they can buy a drink at the bar—because the $10 beer won’t break them.

And raising capital feels so good. It’s a drug—once you take some all you want is to get more. Raising capital means validation from a few really smart people. It means a salary and a bed (or at least a cot from IKEA). It means being able to pay for a flight to SXSW, though not a ticket to the actual talks. It means telling your friends that you are actually employed and it means no longer being embarrassed over calling yourself an “entrepreneur.” It means awesome company t-shirts.

For a few days the fear goes away—and then it comes back, stronger. We realize that the fear isn’t gone, it’s just different. It’s the fear of monthly board meetings, missing projections, the terrifying feeling we get when we realize our teams have children and rely on the paychecks we give them to make ends meet. It’s that “holy shit” feeling when we remember that our team has taken the leap with us—because we convinced them to. It’s the fear that the clients who use our product rely on it for their own businesses to succeed. It’s the fear that we’ll never be able to raise money again if this fails. It’s the fear that our friends expect us to be millionaires, CEO’s forever, and that next year we might be asking them for a job.

And at that point all we want is to be profitable. All we want is to earn a margin on some of the revenue we earn. And we think about how good it would feel to pay back our investors, and how good it would feel to know that payroll will get met each month. Do our friends even realize how amazing the concept of a salary really is?!

And we get to that profitable moment—the fear goes away, for a few days, and then it comes back. What if our biggest customer leaves? What if our key employee quits, gets sick, or leaves the country?! What if we raise another round of venture capital and we’re expected to increase revenue by 300% by December? What if the magazine article we somehow were featured in totally over-estimated us, and our parents have to exaggerate while speaking with their friends to keep the façade of confident, success?

And then some entrepreneurs sell their companies, become millionaires, buy a house and save money so their kids can go to college. And those entrepreneurs become afraid that they’ll have to do something else, something bigger, and the whole world will be watching.

Fear doesn’t go away, it simply evolves. And that’s okay, because it’s the fear that drives us—but it’s up to us to embrace that fear and channel it, rather than let it drown us. It’s up to us to recognize the fears and go after them. It’s the scary parts of our business (like talking to potential clients to make a sale, or firing a troubling employee) that play the most critical roles.

We are founders, and we are afraid, but it’s okay, because so is everyone else. Social media sometimes convinces us otherwise—we see our peers on stage giving talks, featured in Fast Company and Inc, and think “they must know what they’re doing.” But they don’t either. As soon as we’re convinced we know what we’re doing—we don’t. As soon as we’re not afraid, we should begin to worry.

It’s not just you, we’re all afraid, and that’s okay, because we’ll make it.

Further Reading

Great Founders Do the Scary Things

 — Because the Scary Things are Important

Written by

A Student-Entrepreneur

Published October 14, 2013
Thanks to: Emma Tangoren

 

A VC’s Perspective on AngelList


One associate’s take on how AngelList is changing the game

 

AngelList is certainly in the driver’s seat for the biggest change to hit venture in decades. With the release of AngelList Syndicates, and the absolutely perfect timing of the SEC’s changes to Regulation D Rule 506c, AngelList has dramatically lowered the cost of raising capital and has made tech ask a very serious question:

 

If I’m raising money as an early stage startup, why do I need venture capitalists when I could just go through AngelList?

 

Image representing Goldman Sachs as depicted i...

Image via CrunchBase

 

AngelList certainly provides a lot of benefits over the traditional VC approach. Unlike venture, AngelList is much more democratic in how you can approach investors. You don’t need to be invited to a Goldman Sachs conference or stalk VCs at SXSW to get an intro to an accedited investor on AngelList. Raising a round on AngelList can also be a lot faster than the traditional due dilligence process at a venture firm, reducing the amount of time that a startup’s executive team needs to spend distracted by their fundraising.

 

Read more – > https://medium.com/p/fb3cbf5a04ea