​Like many industries, finance is in a state of flux. In part, due to a number of challengers like Monzo and RBS’ Bo disrupting the status quo. Traditions are being re-written, the rulebook has been torn up and now the incumbents are fighting back through a wave of acquisitions, investments and innovations.

Amongst this, leaders in engineering and finance met to discuss how the sector could respond to the many changes now and in the future. The roundtable, organised by La Fosse and led by Mark Allcock, currently Executive Chief Technology and Product Innovation Officer at Neyber and former Chief Innovation Officer at 10x Banking.

He was joined by leaders across the full spectrum of finance, including Ian Fuller, VP of Engineering at Freetrade, Jeremy Bokobza, investor at Blockchain.com, Oliver Whitehead, Director at Orbis Investments, Jonathan Eccles from MG Prudential, Craig Ktizinger – interim CTO providing consultancy, Robert Howes (bond trading business), Spencer Wyer – EDM, doc management, Philip Jakubowski-Drzewiecki – entrepreneur CTO, mentor and Aman Kohli, Chief Technology Officer at DXC.

Lessons learnt from 10x Banking

Mark began the session with a positive look back at his time growing 10x. He noted that in banking, nobody welcomes the need to take big decisions to change core platform especially when many platforms have designs that were created decades ago and that’s behind many of the barriers existing in the sector today. Because of this, Mark joined 10x Future Technologies, led by Antony Jenkins, former CEO of Barclays, and two others to provide a credible cloud-based banking platform to challenge alternate approaches in the market.
The early days

The company started as a four-person team (plus occasional visits from Antony’s Yorkshire Terrier), in a serviced office in central London, with Antony and the team quickly meeting with the CEO of Virgin Money whose decision to work with 10x was widely publicised. It was a meeting that would later see the company accelerate to become a leading scale fintech.

At the early stage, 10x had a clear and bold vision, and lots of code to write and infrastructure to create. But Jayne-Anne was impressed with the vision and expressed a desire to go on the journey with 10x, to collaborate and co-create a new platform. A leading global strategy firm, Oliver Wyman, and a global insurance business fintech venture fund soon became very interested in 10x and eventually became significant equity investors ( see https://www.crunchbase.com/organization/10xbanking#section-funding-rounds ).

The early participation of a major scale client and prominent investors created a combined opportunity and challenge for 10x, one that is often experienced by many high-profile startups – despite the interest and investment, a product had yet to be created. They needed to rapidly build a platform and for that, initial sizing indicated a team of 75 full-stack engineers would be required to make the first version of the platform, comprising the right services and ability to scale. The first members of the team had to be assembled within three months to meet timelines and client expectations.

As the only dedicated technology person on the senior leadership team at the beginning, this responsibility fell mostly on Mark’s shoulders to mobilise the engineering organisation. The challenge was significant, made more so due to the high level of competition for tech talent at the time – a peak moment for London-based Fintech businesses.

Agile approach needed

Mark opted for an agile approach and a blend of senior and mid-level talent organised into feature teams given it was incredibly hard to source entire teams comprising full-stack engineers. This still proved hard, especially because at 10x Mark wanted to hire mostly permanent employees at the beginning who could remain committed for the early years. To meet this goal, a single recruitment agency was appointed who could commit 100 per cent of their time to resource suitable candidates.

Despite time being against them, the agency was able to find the people it needed within the relative tight timeframe. Before long, the team grew again. The agile approach implemented in the early days scaled with the company.

Scaling fast is possible

As 10x’s profile grew, inbound enquiries from top tier banks came in from Europe, Silicon Valley, Asia and Australia. As demand increased, so did the scale of the technology organisation; more feature teams were added and new leadership roles and focus areas were created.

Proving that scaling quickly is possible, powered by strong demand from major banks for the 10x platform, the number of feature teams has scaled up significantly. 10x grows from strength to strength with JP Morgan reportedly in talks to take a stake in 10x following a recent investment by the UK’s Nationwide in the business; thereby, highlighting an increasingly popular strategy for incumbent companies to invest in up-and-coming fintechs.

An evolution in services – and culture

Mark ended by stating that the finance ecosystem has evolved – that large, traditional institutions can now integrate, via APIs, to provide a range of digital services. This, he asserted, is causing a shift in the skill sets required within finance and although the tech stack remains similar, he notes that a shift in mindset is also needed.

Mark is not alone in this thinking, with Ian Fuller mentioning that the culture in finance needs to change alongside certain legacy technology. He predicted that most traditional banks, as they stand with their current tech stacks, are “going to be eaten alive by the likes of Monzo et al”. A dire prediction that was seconded by Aman Kohli who stated that traditional banks don’t have a product-centric view – technology in the financial space is often poor at best in part because of the legacy cultures that exist within many traditional institutions.

Customer experience rising

A key lesson that incumbents can take from challengers is in customer experience. Aman mentioned the passion invoked by Revolut and Monzo. An emotion that he compared to the launch of First Direct a decade or so ago. It all centres on the customer experience and getting the tech team to walk in their customers’ shoes. Indeed, Craig suggested that firms should focus on understanding the customer first and then the right code will follow. Put another way, the tech team need to get into the mind of the end user – the customer.

It is for this reason, Ian suggested, that we are seeing these new players wanting to ‘own’ the customer experience. Rather than depend on external partners to manage the challenges being faced, the idea is to bring the expertise in-house. Whilst outsourcing certainly has its place, a greater understanding of the product and iteration of its features are better served by those closer to it internally.

The big banks have taken notice of this shift, with Spencer highlighting that many have turned from a build to a consumption model. Goldman Sachs (with its challenger retail bank Marcus) is one such example of a quick pivot and scale.

Getting the balance right

However, Rob pointed out that this was relatively simple when a firm has the finance behind it. The real challenge, he stated, was in getting the balance right. In choosing the right metrics to use, to go in-house or outsource and to decide what you want to be known for. He advised that firms shouldn’t think that just because they’re good at tech, they should own the entire product stack.
Hiring the right skills

Of course, success ultimately hinges on hiring the right talent from the start. When building 10x, Mark shared that he had to pay above market rates for some engineers in order to get the right blend of experience, banking know-how and technical expertise into teams. He also widened his talent search beyond people with direct banking experience. As candidates from varied backgrounds would offer diverse thought processes and ideas.

Mark recommended empowering teams with learning opportunities and to ensure a good cultural fit. The churn rate on the 75 engineers that 10x brought on board was surprisingly small, he stated, and those that left did so because of a lack of cultural fit or a desire to pursue different career paths altogether.

The importance of culture

Indeed, retaining the right culture when scaling and competing against other banks, fintechs and tech firms is crucial. Craig explained that he often recruits based on aptitude and attitude and prefers to partner closely with recruiters so they understand exactly who is needed. Acting fast in a competitive market is vital because great talent is snapped up quickly. Testing for personality and technical ability is another option, Philip recommended.

Oliver weighed in about talent retention moving beyond monetary aspects. Again, culture strongly links to this, as does the core values of a business. Behaving ethically is as important as remuneration and rewards.

Finally, Spencer drew attention to toxic people and how they can kill cultures and slow down growth. Sometimes, it’s the most senior people who are wrong for the company and who cause good talent to leave because of an unhealthy culture.

Common threads for all

The roundtable discussion left much food-for-thought. Particularly around the changing finance ecosystem and how big banks and fintechs are evolving. There is a shift in skills, that demands a different kind of employee and a culture that supports their growth and work. Plus, a move towards ethics that cannot be ignored.