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We Need To Talk About Kevin
Plus, "Shift Happens - Fintech" (Video)
Hayden Hughes21st Mar 2017
Why do we need to talk about him? Well, the Kevin in question is Kevin Systrom, a talented Google programmer who despite his promise was overlooked by the company’s high-potential talent programme. Post-Google, he found himself on a Mexican beach, where he co-founded a small photo-sharing app. That same small app sold to Facebook for a billion dollars. You might have heard of it? Instagram.
Shift Happens - FinTech: A video overview of the changes facing the financial industry
Systrom’s departure from Google represents a lesson learnt and understood best by the FinTech industry; that talent needs to be identified, nurtured and challenged if the banks are going to compete in a disrupted marketplace. Anthony Jenkins, the former CEO of Barclays recently said “If banks want to really compete for talent successfully, they are going to have to make themselves interesting places to work. It can’t just be about the money, because frankly the money isn’t going to be there the way it was before 2008”.
Identifying and developing talent is one of the fundamental challenges facing the financial services industry today. Silicon Valley’s major players figured out early that talent is the cornerstone of competitive advantage at a time when a well executed, singular vision or idea can make all the difference. As Jamie Dimon noted in his annual 2015 letter to JP Morgan shareholders “Silicon Valley is coming. There are hundreds of start-ups with a lot of brains and money working on various alternatives to traditional banking.” The march of technological progress is irrefutable. What is perhaps less certain is how the various players will cope with the type of changes seen in many other industries over the past decade. In a speech at Chatham House, Jenkins recently described the disruption created by FinTech as approaching the “Uber moment in financial services”.
Back to our protagonist and how his story represents a salutary story to us all, not least to those of us working in the financial services industry. In 2002, Marissa Meyer created Google’s Associate Product Manager (APM) programme. The programme was designed to find the best and brightest computer science graduates with less than 18 months’ work experience who, after an extensive selection process, would join the two year programme. Meyer herself was the final stage of the interview process, handpicking top talent for a decade to join her accelerated leadership programme, creating hundreds of acolytes and the tech rock stars of the future.
Our focus here is not on the talented elite from the programme that went on to build Chrome and other great Google products, but rather on the one that got away. When Meyer set up the programme, she was looking to find product managers that were not only technically strong; they would also possess an entrepreneurial mind-set and be suited to Google’s way of getting things done.
Salar Kamangar, now CEO of YouTube, had noticed a marketing associate that he thought would be perfect for the programme. But whilst this individual was a self -taught coder, he didn’t have a computer science degree and as a result fell outside the strict parameters of the programme. In their book “How Google Works,” Eric Schmidt and Jonathan Rosenberg lament that they refused to “expand the aperture” and Kamangar’s requests were denied. The associate in question was Kevin Systrom.
It’s not a big leap to argue that regardless of any intervention, Systrom’s technical capability and entrepreneurial spirit would likely have led him to strike out on his own at some point anyway. But it’s the “what-ifs” that Schmidt and Rosenberg both acknowledge that this level of talent and capability, nurtured and pointed in the right direction, has game-changing potential. It serves as an interesting reminder to us all on the importance of identifying and nurturing talent and to be brave about our people decisions.
The dynamics influencing the marketplace are countless and, as the traditional banks have discovered, there is no silver bullet. One golden thread running a seam through the stories of digital disruption over the last decade is the power of talent. Much has been written about the Age of the Knowledge Worker and the war for talent. The distinction here comes in two forms; firstly the inspiration of individuals such as a Tim Berners Lee, Larry Page and Sergey Brin to create new epoch changing tools, but secondly and arguably more importantly, the need for great talent to make that dream reality.
Whilst the singular vision of founders has the potential to establish and define tools such as search, Google stands as the poster child for competitive advantage realised by creating a culture where the hiring and nurturing of talent is your unique differentiator. Never before has it been clearer that behind any great leader there needs to be a well-oiled, dynamic and highly skilled team to execute on the founders’ vision.
Beware of the garage
In time past, banks were able to leverage their size, resources, complexity and longevity in the industry. In a digital age, the ability to pivot and be agile has become highly prized by investors, something that by its very nature a large, established bank is not set up to do easily.
Whilst much of the banks’ focus will understandably be on challenger banks and established technology giants, there is good reason for them to focus on the younger upstart. Technology companies have a history of starting from humble beginnings and seeing exponential growth as a result of talented founders with a unique take on a problem.
The likes of Amazon, Apple, Google, Microsoft and Hewlett Packard all began in their founders’ garages and offered a new approach to received dogma, whether that was buying a book or a motherboard, conducting a search or building an operating system. In Hewlett Packard’s case it was a leg-up from the Walt Disney Company (also founded in a garage) when they purchased eight oscillators to improve its sound system for the film Fantasia, setting the tech giant on its way. The Packard’s garage remains a Palo Alto landmark as the birthplace of HP and the foundation of Silicon Valley.
A licence to experiment
Empowering high potentials, exposing them to high profile projects and talented seniors in the business is an excellent way of getting a unique take on a project and nurturing and retaining the best talent. Challenger banks and FinTech companies are able to experiment and play in a way that is tricky at best for established banks.
FinTech companies are well positioned precisely because the weight of expectation for them to continue the well-trodden path doesn’t exist. They are able to fail fast, measure what works and what doesn’t and learn from their mistakes, iterate their product and crucially their customers will understand that this is part of their evolution and learning curve.
Many of the large banks have realised how critical this approach is to success and have created sandpits in which tech talent can explore and play. These incubators allow them to experiment free from the shackles and constraints of a more traditional set up. By creating and fostering these hubs, traditional banks are able to hire and retain top talent and reduce the risk of being left behind.
Right now the FinTech industry is fragmented and whilst some of the principle players are already centre stage some promising acts remain in the wings. Acquisitions and potentially lawsuits are likely to feature in the unfolding of this story. But we shouldn’t underestimate the part played by both the vision of individual founders and the potential of nurtured talent to develop the future titans of the industry.
Perhaps we should all sit up at our desks and look around us and realise that Kevin represents a clarion call to the industry. Is it possible that right now you’re sat beside the next “one that got away”? Or maybe it will be the candidate that you’re meeting later today that will revolutionise your business? Perhaps not - of course it’s always possible that you can rest easy right now, you’ll drive home and park up and unbeknownst to you that light next door is the next Google of the financial services industry, coming to a garage near you…
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