Finance has just gone social.
Launching today, dfinanz, an Australian social network for financial information wants to simplify the way consumers figure out how to get the best deals on, for example, home loans.
By providing a platform, dfinanz wants to blow the sector wide open by providing a forum where people can share ideas, strategies and information about what they should be paying for their mortgage or other consumer finance products. It’s not a lender, broker or a search engine.
After a 20 year career in banking and finance, founder Peter Coco came up with the idea about a year ago while working at the trading desk. He’s worked both in Australia and offshore in commodities, foreign exchange and interest rates at institutions like NAB, what is now HSBC and Westpac.
“You sit at a trading desk and at any second in time you can access all sorts of information about all sorts of financial markets. It was ironic at that point that I had to do some work on my home loan and the next thing you know, I’m buried up to my neck in information that I had to wade my way through,” he said.
“I’m a banking professional and I found that hard work. It staggered me a little bit that if I wanted to know what the Zambian Kwacha was trading at, yep, no problem, I can get that. If I wanted to know what my home loan is I’ve got to spend the next three, four days of my life wading through rubbish.”
He thought to himself surely you could take basic financial markets principles, deal with the information issues and apply it to consumer finance as it’s a lot less complex market than financial markets but has become so dense.
The idea to create a platform where people can negotiate their home loans on their own terms was very ambitious so he went on the hunt for people who could help him build the business and devise a strategy. He hired his former boss at NAB Bank, Tim Blomfield, as his CEO, and marketer Aitor Satrustegui as COO.
The platform collects some key information from consumers but keeps it anonymous from the banks. It’s this data which dfinanz says helps people get the right information so they can decide what a fair home loan rate is.
A self-funded startup, the team isn’t looking for funding at the moment but wouldn’t rule it out in the future.
Fintech startups are shaking up the financial sector around the world and the banks are taking notice. Just last week Commbank CIO David Whiteing said the bank has a lot of work to do to maintain its tech edge.
But whether it’s their banking background, the fact that it’s not a bunch of 22-year-olds at the helm, or that they need the banks to engage with their platform, this startup doesn’t want to rock the institutional boat too much, they want to show them how to interact in a tech world.
“We don’t think banks are not necessary. Banks are going to be here in the future and we need to start working with them, not bypassing them. We need to bring them to this new digital era,” Satrustegui said.
With a strong banking background behind the fintech startup, Coco said it has impacted the way the company has taken shape in the past 12 months, including how it reacts to situations and talks to banks.
“It certainly helps. there are a lot of really smart guys out there in banks and a lot of them have decided to step out of it and have a go. We think that’s brilliant. It’s all about trying to help consumers at the end of the day and the best way to do that is to step out of it for the time being to help propel change,” Coco said.
Here are three ways working in the industry has helped drive this fintech startup.
“It’s one thing to have a plan but you need to have the discipline and right people around you to execute the strategy. Banks are very good at that and it’s something that I’ve picked up on over the years,” Coco said.
The importance of being able to adapt
“It’s not so much of a banking skill but a financial markets skill, learning that things change very, very rapidly and you’ve got to be able to deal with that. That’s actually been a skill that has been crucial for this particular journey,” he said.
Talk the way banks do
“The ability to be able to communicate with the banks and understand where they’re at and understand what their needs are,” he said.
“The average startup, they’re founded by IT guys and have beautiful technical solutions. When you’re a banker working on a fintech startup, you know what the problem is, you believe you know what the solution is and you’re talking the same language.
“It makes the whole assumption validation process a lot quicker.”