This spring, CFA Society Toronto moved its events to an online format as part of its response to the COVID-19 pandemic. On May 13, 2020, “Beyond Bay Street into Fintech: Unlocking Hidden Opportunities” was the first panel event held by the Society in this format. This event was the second in the Beyond Bay Street series, which chronicles the experiences of professionals who have transitioned from established careers in finance to more entrepreneurial or broader finance ventures. The event, organized by the Corporate Finance Committee, was well attended with over 100 virtual participants.

The panel consisted of: Jean-François (J-F) Courville, CFA (CEO of Wealthsimple for Advisors, a B2B wealth management platform); Han Ryoo, CFA (product manager at Wish, a San Francisco-based global e-commerce platform); and Karim Gillani (co-founder and general partner at Luge Capital, an early-stage fintech-focused venture capital fund). The panel discussion was moderated by Doug Sarro doctoral candidate at the University of Toronto Faculty of Law.

The panelists discussed emerging trends in fintech, such as disintermediation and the digitization of financial services—trends that have only accelerated by the COVID-19 pandemic—creating demand for digital utility infrastructure companies. The landscape is becoming more innovative, where firms with high levels of transparency and service integration are poised for growth. While the payments sector is maturing, other areas could see further changes, such as insurance. Canadian banks are also taking strides towards innovation and partnering with fintech companies, and Canadian regulators have been progressive by taking a nuanced approach to topics such as cryptocurrencies and non-traditional securities.

The panel discussed key factors to consider when making a venture capital investment, such as the pedigree of the founders, appreciation of the industry, size of the market opportunity, and meaningful differentiators. Revenue and other indicators of traction, such as user base and qualitative factors, are looked at closely as venture capital investment is high on the risk spectrum. Ensuring a strong match between the venture fund and the company is an important consideration for both sides, and goes beyond financial terms. Founders were encouraged to continuously validate their ideas with their partners and remain open to investor feedback.

The panelists themselves had followed varied career paths, from software development to traditional corporate finance, and worked through areas such as product management and roles in smaller start-ups, initially leveraging their technical skills. Moving directly from the C-suite in a traditional finance role to a leadership role in a fintech was also discussed. The skill sets required to make such a transition depended on the role, and the type and stage of the company. The panelists noted that analytical skills, a data-driven mindset, an entrepreneurial orientation, an understanding of the industry, regulatory landscape, and product markets, an appreciation of technology and engineering, and operating experience were noted as useful to have. There was a prevailing view among the panelists that it is not necessary to have technology expertise, as there are also non-technical roles in start-ups. The ability to let go of entitlements and handle the inherent uncertainty of the start-up environment often prevent some people from taking the plunge. The panelists challenged entrepreneurs to ensure one is solving a real problem, to surround themselves with the right people and culture, and focus on possibilities.

While it may not always be a prerequisite, the CFA designation can bring context and understanding to the fintech sphere and can be a differentiator in certain roles, such as product management. The transition to working in a start-up can be challenging, but is also highly rewarding. While innovating within traditional firms has the advantage of scale, a wider range of initiatives can have a greater impact in a smaller set-up, and that kind of environment can be fulfilling to those suited for it.

The feedback on the event from the survey participants was extremely positive, despite people missing the networking component of our typical events. The Society is building on the format and introducing other elements to make it even more interesting for participants.