Leaps forward in FinTech innovation will allow “the next Warren Buffett to come from retail investors and not traditional [institutional] money markets”, a leading entrepreneur has claimed.
Speaking at MoneyConf – a gathering of bankers and FinTech entrepreneurs in Madrid – Ronen Assia, co-founder of social trading site eToro, said retail trading behaviour is now much more similar to those in the insitutional market, levelling the playing field.
He said: “The rise of social networks over the past decade allowed us to harness that notion and share things online. When we launched, people thought we were just crazy [saying] ‘no one is going to share anything online because people are very secretive about what they do on the markets.”
However, Assia says that has not been the case and e-Toro is now seeking to become a “household name”.
He said: “We feel the attractive part is being able to connect to people around the world. Lets say, I am here in Madrid, I know nothing about the Spanish market. Now, I can log into the platform, find some spanish traders who know the market and allocate a portion of my portfolio to follow them.”
Assia cautioned that FinTech entrepreneurs would do well to remember that innovation in financial technology is a very different thing to developing non-financial technology, because it involves money. This, he said, means it takes time to win trust.
He explained: “If you look at the entire fintech vertical. FinTech is something that is for the long run. it is not just like developing a little game for IOS and taking the scucess in six months time.
“It takes time to develop a brand when you are asking for money. The economy changes, the regulators change. I think it is a matter of understanding that you are here for the long run and it will take a couple of good years to create a financial brand.”