Brokers are from Mars Fintechs are from Venus
Martin Stewart is director of London Money
Do you remember this book from the 90’s? It was all the rage for a few years and was seen as the definitive relationship guide for men and women, certainly everyone I knew purchased a copy.
Unfortunately, most of them are divorced now so I am going to hazard a guess none of them got around to reading it.
Still, as titles go, it was eye catching and therefore deserving of being tweaked and hammered into a tenuous headline for the purposes of this article.
But the essence of the message within the title is relevant whether you are arguing over your CD collections or the digitalisation of the mortgage process.
Quite simply, if you are speaking a different language about what you want, the chances are both sides are going to be disappointed. I should know and if anyone wants a copy of ‘The Best of Celine Dion’ please DM me.
Look, I am the first to admit I am a Luddite. Although that is a misplaced derogatory term. Luddites were not ignorant, they just understood that change brought with it a degree of risk and they cautioned people to consider the unintended consequences of technological advances.
And rightly so because Fintech can be one of two things. A license to print money or a license to burn it and it can be a real gamble to predict which one will apply to the cheque you have just written.
A venture capitalist could argue half the money they invest in Fintech is going to be a waste of money. Unfortunately, they never know which half.
Proof? I am preparing some slides for a talk this week and one of them is proving to be very expensive because I reckon conservatively it details £100m of accumulated losses and “discounted” valuations spent by Fintech to try and crack the mortgage process.
I am not here to argue against the advancement of technology, even I know that is inevitable, but more that it feels like the money being poured into our sector is getting spent in the wrong places. Sometimes it feels like we are spending money to find a solution to a problem no one can quite pin down.
This job is not hard. If anything, it is probably one of the easiest careers out there. There are two ways to acquire a client. One is organically and we do that in our sleep.
A good solid mortgage broker will not struggle to find someone to talk to. Drop a decent one in the middle of field in the middle of nowhere and they will be keying an app for someone within 24 hours.
So, I think we need to start the Fintech investment process not with the word innovation but the word intermediation.
The second method of client acquirement is to do it dynamically and this is where we might see some revolution, something to sort the pronouns from the pronouns.
Dear Mr Private Equity, you could do a lot worse than invest that £100m into the marketing and branding of people who know how to do the job rather than giving them £100m to simply do their job. Basically, find the communicators first and once you have, only then go and find the programmers.
I had a very vulnerable client over lockdown whose mental well-being I was so concerned about I offered to drive to his house to sit with him. Show me a chatbot that can non-verbally identify the same and I might start to change my mind.
And communication needs to be better elsewhere as well.
It is going to be a real differentiator in the years ahead. A recent YouGov survey suggested that the majority of under 35’s do not actually understand the mortgage process. Hello??? What have we been doing since the financial crash?
I will tell you exactly what we have been doing and that is plummeting over the event horizon and falling into the black hole of self-congratulatory, back slapping. Award ceremonies in isolation rarely create nationally recognised brands.
It does not surprise me therefore that the younger generation are taking more advice from TikTok videos than they are qualified advisers. We are in real danger of BORING THEM TO DEATH.
And here is why:
· 1500 new social media users were created in the time it took to read this article.
· Each minute over four million videos are watched on Youtube
· There are nearly 70,000 Instagram posts every minute
· There are over 500,000 Facebook comments made every minute
· There are now over five billion mobile devices in use around the world
And yet, all we ever talk about is the holding music of our least favourite lender and that a solicitor forgot to return our call. I am sorry fellow industry peer, but I was having these conversations back in 1996. Trust me, the world is moving a lot quicker than your marketing department.
Our sector is worth £280bn annually, our share of that is 75% and there are probably only 10,000 of us worthy of servicing it. The good news is, the numbers are on our side, the bad news is, time might not be.
So, can we please stop talking our tired old language and start learning a new one. If not, there is every chance these great words by George Bernard Shaw might end up on the gravestones of our respective careers:
“The single biggest problem with communication is the illusion that it has taken place.”