New Focus On Women In (Fintech) Start-ups

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This is a guest post from Marguerite Arnold.

It is not just the stunning reversal of fortune for Hillary Clinton at the beginning of November which has stimulated a renewed interest in more diversity in the world of start-ups, and FinTech in particular. The conversation has been underway for quite some time.

Part of the drive for diversity, to be honest, is caused by a failure of women to rise to the top in most large businesses – including the financial services, banking or tech industries, despite a generation (at least) of trying. However, the focus on gender diversity remains, just about everywhere there is a budding FinTech start-up community. And a lot of the calls for diversity are coming from not “just” women, but men.

In Frankfurt Germany, this conversation is absolutely at the front and centre of just about every FinTech gathering right now. The Frankfurt “scene” is absolutely poised to break out on to the global stage, just because of the presence of so many highly educated, financially savvy people –from all over the world. But, as is painfully obvious, at gathering after gathering, except those ostensibly “for women”, the faces are mostly white, and with very few exceptions, all male.

As a result, there is an increasingly dedicated push to change that and for reasons that extend far beyond “political correctness”. This being Germany, there is a push to fill at least 30% of management boards with women as required by new German law that came into effect earlier in the year.

FinTech and Insuretech, in particular benefit hugely from the presence of women in senior positions for many reasons. The first is that the most successful companies in the sector succeed because they are able to define niche markets and reach them in new and often more efficient ways. While men are not incapable of figuring out how to do this, of course, having a different perspective, including unique experience and gender diversity along for the ride, is one way to succeed at this even better (no matter the community being targeted or service on offer). However, beyond service provision itself, the promise of encouraging more women to enter the FinTech industry is the new range of products their insights and experience have the potential to create. Even in the ostensibly “established” world of financial services and banking, the idea of a company (or companies) that provide services tailored to what women want is absolutely exciting. Beyond this, of course, is a wide range of products that interact with the consumer in different ways. Women play a huge role in helping to define the consumer experience – from the services themselves to how users interact with the interfaces.

As a result, there is actually no better time to be a woman in the world of start-ups. And the women who are, despite speaking and pitching to audiences still mostly made up of men , are also finding that for the first time there is a new acceptance and eager willingness to welcome them into the ranks of one of the most exciting industries on the planet right now.

You go girl!

Marguerite Arnold is an entrepreneur, author and third semester EMBA candidate at the Frankfurt School of Finance and Management.

(Image Source: Bridging the Gender Gap)

Brexit & The Future of Startups In Europe

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This is a guest post from Marguerite Arnold.

Since 1972, Britain has been part of the European continent. I remember the opening very well. I was a kid, living in London. The new openness meant we could afford oranges from Spain. Every week, an old French farmer would also peddle through London with strings of onions hanging from his bicycle. I thought the arrangement was unbelievably cool and more than romantic.

Fast forward forty years, and the situation is now reversing, and that is not only a shame, but I predict it will have dire and unforeseen consequences for the British.

The England I knew as a child was a fascinating place. It was a country struggling to keep together the concept of a social state, still wounded by the war, and losing the last pieces of its Empire. You could still travel to central parts of London and see unreconstructed bomb sites left over from the war. I will never forget seeing one, incongruent with the bustling scenes around it, and asking my father what it was from. He answered “The Blitz.”

Today, of course, London is a different city, and England is a different country – transformed, much like the U.S. into an economy which may be again calling itself “shared” – but in fact is premised on something very different.

After WWII, most European countries, as well as significant parts of the U.S., believed the future was only attainable by creating a strong social platform upon which the other parts of life would work. “Regular” jobs. A middle class life. A steady pay check. A system to take care of the sick. Retirement funds to take care of the old.

That system is gone now – or at least fading, and we are on the cusp of something else. Thus the explosion of start-ups, start-up culture and the new entrepreneurialism. This is part of the reason that start-ups have thrived in the U.K. – particularly high tech start-ups. The country has been, for a generation, trying to define itself. There is no way the island can survive independently. No country can. The British train system uses German trains. The auto industry is hurting. Oil is an uncertain energy source. Overpriced British real estate in London fueled by foreign investment does not an economy make. Britain, right now, is much like the U.S. Casting off the old very quickly in an attempt to create something that works better (although for whom and how many is still an open question).

However start-up culture is not the same everywhere.

Across the Channel, things are different. There is more social integration and infrastructure. Every country east of France still has a streetcar system that works. There are still national healthcare systems which strive to provide health care for the oldest and sickest. And the approach to start-ups is a lot more cautious – in part because things still work the way they were designed to. People here just do not understand how, for example, a presidential candidate who did not pay his taxes for 20 years can even be credible.

This reliance on a broader superstructure, which the Europeans are loath to destroy in search of something “new”, does not mean there is no innovation. As a professor of mine said to me recently, mobile payments (a particularly hot area of Fintech innovation elsewhere) are just not a priority in Germany because of the continual upgrades and improvements to the customer banking experience (also known as SEPA), that has already created a workable middle way.

However, Europeans in general and Germans in particular, are not deaf to innovation. They too are looking for ways to innovate as the older systems become increasingly outdated. It is just moving a bit more slowly here – and frankly a bit more humanely. Chaos might provide a lot of exciting booms, but that is not a place where most people want to live their lives. And as Britain shuts its doors to the rest of the continent, there are many now who are looking increasingly to both Berlin and increasingly Frankfurt, to be a new platform for innovation.

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In Frankfurt, there is a steadier (and much cheaper) platform for innovation in the form of cheap rent, transportation and an overall standard of living. And it is provided by the security and infrastructure that comes when countries do not throw the baby out with the bathwater in search for “something” if not “anything” new.

Marguerite Arnold is an entrepreneur, author and third semester EMBA candidate at the Frankfurt School of Finance and Management.

(Image Source: BBC and Tripadvisor)

Lessons Learned from a German EMBA

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This is a guest post from Marguerite Arnold.

In the fall of 2015, after spending two years in a small town in the Ruhr Valley starting to learn German (I will appreciate Mark Twain’s perspective on the sprache so much better going forward), I moved to Frankfurt to begin my Executive MBA at the Frankfurt School of Finance and Management.

There are many reasons why I chose to obtain my graduate business degree in Germany (and even more specifically in Frankfurt). I am an American expat, with my future plans in Europe if not the rest of the world. I have felt, for quite some time, that American business schools are myopic when it comes to understanding international business issues and globalization outside of maximizing profit. I also feel that there is something very right going on in Germany specifically, that has been fundamentally lost in the U.S. There is a strong manufacturing culture here that is shifting to the future with a face that is far more humane and sustainable (and certainly more green, the disaster at Volkswagen notwithstanding), and the so-called “Mittlestand” – small to medium sized enterprises – create a business culture in which innovation and change can thrive.

While Germans frequently ask me “why come here when you have the U.S.?” the answer is super simple. Yes, things are regulated in Germany on a level that drives even rules-obsessed Germans to distraction. And yes, change comes more slowly here. But the so-called “creative destruction” that drives American entrepreneurialism is now happening in a way that is destroying companies and lives if not innovation in general (including in Silicon Valley).

Germany is more interesting.

German regulation and the thinking about the regulatory process in general, particularly in industries like banking and Fintech, is a standard which could certainly help redefine not only the German market, but create a global benchmark for those who understand that regulations are necessary. The changes that Germany has managed to transcend (including those of the post war period, reunification and even its acceptance of refugees) were only possible because of a strong national culture that is by definition globally focussed. Germany has no natural borders and, perhaps because of that, the country has created a national identity and operating DNA that is designed to be like an ocean liner on a global ocean, rather than a country which walls itself off from the rest of the world.

Frankfurt itself is also a fascinating city. It is not only where my family is historically from, but has long been defined by international trade, commerce and global thinking. Now it is set to become a thriving cluster for FinTech entrepreneurs in a way that other cities cannot match due to the winning combination of its size, infrastructure and proximity to global banking players.

The Frankfurt School itself is also a very interesting place. Started as a school for more traditional bankers and executive education, it is rapidly moving up the global rankings and redefining itself in a rapidly changing world; the school is perfectly positioned to address the transformations happening in the banking industry with the impact of digitalization, cryptocurrency and mobile payments. My class has also achieved a number of “firsts” for the school: we are a highly diverse international group, classes are taught in English, and we are 40% women.

In terms of coursework, it has by far lived up to my expectations (and I have high ones, partly because of my 25 year professional career in the U.S. but also because I am Peter Drucker’s niece). Our professors are drawn from the ranks of both the school’s faculty and drawn from all over the world (including Ghana and the U.S.) However, the perspective offered here is exactly what I was hoping for. And the lessons learned from the teamwork exercises and my classmates are ones I will take with me for the rest of my life. We are drawn from every industry, and every kind of background. And more than a few of us are using the EMBA experience to either begin or more seriously launch our entrepreneurial careers and aspirations. Drucker once wrote that once a subject becomes obsolete, it is taught in the classroom, but that is not the feeling I have here. In fact, the Frankfurt School has made it a priority to present classical business education in the context of a world that is changing fast (from every perspective). And while there is a healthy appreciation of American innovation, it is taught in a way that is separate and distinct from a mind-set that is focused mostly on the American market.

Students who want to understand a world outside the U.S. on topics ranging from globalization to sustainability would do well to consider a German business education.

Global business is about understanding the needs of stakeholders who come from a diverse range of cultures; being able to create a remarkable “journey” for employees and customers; and responding to and managing change in a way that does not upset the core mission of the enterprise. It requires innovative responses to both the mundane and the exception.

At heart, those are some of the real lessons I have learned here at the Frankfurt School. It has been one of the most challenging and rewarding experiences of my life.

Marguerite Arnold is an entrepreneur, author and third semester EMBA candidate at the Frankfurt School of Finance and Management.

(Image Source: WallpaperUp)