May we introduce: Dennis Austinat from eToro
Working in the FinTech sector is like coming and going, requires a high degree of professionalism in a thoroughly relaxed working environment and is above all characterised by innovations as well as good, clever and future-oriented ideas, according to the widespread consensus. But who are actually the brains and doers behind these creative thought processes, at the interface between finance, digital technologies and entrepreneurship? In our series: The faces of the FinTech industry we regularly ask a person from the payment and banking industry the same ten questions. This time Dennis Austinat answers our questions.
May we introduce…
During our everyday work we meet exciting people who work in the same environment, who we meet only once or from time to time or who we have already grown very fond of in our private lives – each of them has a story of their own. We have a few of these People from our nearest FinTech environment to give them a face. To share why this industry is much more to them than just another way to pay their rent. We would like to briefly portray and introduce these people and their vita in a very special category and have designed a questionnaire that is always the same.
Who are you, what do you do?
In the role of the German head of the investment platform eToro, I am responsible for the German-speaking market – but my office is in Israel, where eToro’s headquarters is located.
When did you first notice the word FinTech?
I first encountered the term probably in 2010, when I emigrated to Israel. I have my background in the areas of real estate and events and was looking for jobs in a promising market where I could take my next professional step.
In Israel, the most promising sectors ten years ago were already the high-tech and financial technology industries. That’s how I got my first job in the Fintech industry at Superderivatives (now part of the ICE group).
What were your first contacts with the payment and banking industry?
My first direct contact with the banking industry was at the age of eleven, when I received my first ATM card from my father. My father had set up the account for me so that I could use it to manage my pocket money in future and collect the cash with the card myself.
How do you define FinTech?
Fintech means the application of technology to a wide range of financial services (originally desktop-based, today increasingly “mobile first”).
However, I am convinced that the term has undergone a certain evolution and is still subject to change: In the past, Fintech meant using the aforementioned ATM card for its own financial transactions. During the 2000s, Fintech included online banking. Today Fintech means online and mobile payment. And in the future, Fintech will certainly primarily refer to the use of crypto technology for processing financial services.
What do you think established companies do better than FinTechs?
The internal structures of established companies are often more precisely defined, i.e. processes between employees are clearly regulated. This ensures a smoother flow between different employees. So when a bank is established, a certain checklist for each process is strictly followed, especially in Germany. Precisely defined roles enable clearly defined processes, but do not allow any deviations, for example to respond to individual customer requirements.
In contrast, Fintech’s often have a structure or even a product that is not yet fully defined and therefore any employee of the company can contribute ideas. In the end, the result is often completely different from what was originally planned.
However, the end product is then usually strongly influenced by input from customers so that they actually use it and it provides them with a corresponding added value.
What can you learn from FinTechs?
Above all, one can learn from Fintechs that the status quo is actually only relevant for this moment and that everything can change at any time.
The fact that small innovations can take on huge proportions can also be learned from this industry.
Furthermore, Fintech’s have proven that fee and authority structures are not always necessary to create a meaningful product in a free market economy. To elaborate on that: Of course, a free market economy must be carefully regulated. However, if not only the regulator regulates the market, but also the providers themselves, there is a risk of blocking innovation and the further development of the industry. In the past, and in some cases even today, customers have often been told by their bank advisors in response to specific inquiries that their wishes unfortunately cannot be fulfilled due to the given processes. Fintechs are breaking up the sometimes rigid model – this opens up new avenues for an entire industry.
Why do established (large) companies find it so difficult to go digital?
To adapt to new circumstances, a company must change its core product from the ground up instead of just adding new features all the time, otherwise the entire system becomes unstable. This is something most companies shy away from. However, despite the sometimes enormous effort that transformation involves, a company should continuously orient itself to the latest technological possibilities. If, for example, you work on an outdated operating system and program new solutions on a basis that is too old, the services and the entire business model are not scalable.
Many established companies shy away from adapting innovations because they are sceptical about the security of the new solutions. Of course, security is a major priority, so before rolling out a new cross-company change, everything should first be thoroughly tested. But companies generally cannot avoid the integration of new solutions in the course of a company’s life.
“Many companies shy away from adapting innovations.”
Another obstacle is the concern about the profitability of the business model. If things are going well at the moment, the introduction of an innovation would jeopardize this state of affairs – at least by most likely incurring additional costs for the company. Established companies rarely want to take such risks directly either – but waiting too long is simply not an option in the current environment, in which established companies regularly find themselves challenged (regardless of the sector they operate in).
What would you do professionally if you were not working in the payment and banking industry?
I love to cook and I am happy when the cook likes what I have prepared. Therefore, as an alternative to my job in the Fintech industry, I would almost certainly be a restaurant owner and chef de cuisine. The basic principle of my restaurant would be that there is no menu, but that the guests can enjoy new, innovative flavours, which are always based on their wishes.
Which company would you like to work for one day?
When it comes to professional careers, I would love to spend a day at Elon Musk’s satellite company Starlink to learn about the latest technological approaches to hardware and see how the structures of this innovative company are set up.
However, in order to further develop my idea of a restaurant chef, I would love to work in one of the restaurants run by British celebrity chef Gordon Ramsay and learn from his cooking skills.
Who would you like to have a beer with?
Since Donald Trump does not drink alcohol, a non-alcoholic beer would be fine for me in this case. I would be interested in this man’s true world view, his plans and honest future prospects. I am less interested in his political perspective than in his personal insights he has gained in recent years. It would certainly be interesting to hear him talk.