Who made it into the Forbes Fintech 50?

The Forbes Fintech 50 2019 reveals that although the crypto markets may be going through a frosty period, investment in the growth of fintech businesses surged in 2018. As Forbes reports, total investment reached $55 billion in 2018, double that of the previous year. The Forbes list of the top 50 finteches also shows that the businesses themselves are getting bigger, with 19 of the 50 firms valued at, or in excess of, $1 billion.

This is only the fourth time that Forbes has published this list and it’s pleasing to see that there are 20 startups that have made the cut for the first time. It is also interesting to see that the sector showing a strong growth in startups is that of payments services, particularly those focused on providing a service to the unbanked. In the case of the USA these people are typically migrants without a US credit history, or people who live hand to mouth on a wage paid weekly. The lack of access to banking and payment facilities is a greater problem in developing countries, but let’s not forget it happens in the first world as well.

Exchanges dominate

There are few surprises at the top of the list, as many of the names are familiar: Axoni, Bitfury, Circle, Coinbase, Gemini and Ripple are all headline makers. Bitfury is the only non-US based of this top six: it is based in Amsterdam. It started off as a bitcoin mining outfit, but then launched its own blockchain plus software designed to help U.S. law-enforcement and others investigate illicit activity using bitcoin. It has a valuation of $1 billion plus and received more than $150 million from Korelya Capital, Macquarie Capital, Dentsu & others.

Axoni may be less famliar than say Coinbase, Circle or Ripple. It uses blockchain-based smart contracts to overhaul the back office of the world’s biggest derivative markets. It received funding from Goldman Sachs, JP Morgan and others to the tune of $59 million.

Circle, with a valuation of $3 billion and Coinbase with a valuation of $8 billion are big hitters; they even sometimes work together. Last year they partnered to launch a stablecoin USDC — a crypto asset using the ethereum blockchain and backed by US dollars.

Payments services present in big numbers

Payments services make up 25% of the Top 50 list. The Forbes list is skewed towards US companies, but it is notable that in the payments sector, it includes Transferwise, a UK registered company, widely used by Europeans when they need to transfer large sums of money across borders. Other payments services listed include Bolt, which is the ‘smallest’ with a valuation of only $20 million, whereas Stripe is one of the largest with a valuation of $685 million.

Forbes predicts that the leaders in the blockchain sphere will stop trying to outrun each other in 2019 and will instead start seeking partnerships within the mainstream world of finance.

The World’s Most Innovative Companies

Most Innovative Companies

Who are the world’s most innovative companies?

This isn’t an easy question to answer, because the criteria used to select them varies between the different publications that publish the league tables. Some attempt to take an objective approach and others are clearly more subjective. Is one better than the other? Well, ‘objective’ is logically superior, but in my opinion, it doesn’t always result in an unequivocally definitive answer. For example, there are two highly respected publications that pride themselves on being objective – Forbes and Thomson Innovation – yet when you examine their lists of the Top 100 most innovative companies, there is not one company that shows up on both lists. The reason for this lack of consensus all comes back to different definitions of ‘innovation’.

The usual suspects

If I asked you to name the most innovative companies of 2017, who would you choose? Surveys show that many people name companies like Nike, Apple and Google. This has more to do with these firm’s high visibility and what marketing people call ‘brand equity’, which means they get selected because they create an impression of always being on the cutting edge. But does that mean they actually are being innovative? In many cases the answer is yes. Some may be riding the waves of previous achievements, but others continue to innovate based on their existing platform, and to me that is a sign of a successful innovator.

For example, The Fast Company, which publishes an annual league table of the most innovative companies, puts Amazon in No.1 spot. Its table is based on consumer and marketers research. So, that needs to be kept in mind when assessing their list. Why is Amazon at the top of its list, because consumers perceive it as “offering more, even faster and smarter?” Scrolling down its list, there are a lot of the usual suspects in the Top 10: Uber, Google, Facebook and Netflix are all there, as you might expect.

Communications innovation features strongly

However, if you look at the winners by sector, there are less well-known names, and these really interest me, partly because more than a few are in my field of communications. Tencent’s WeChat messaging app is so popular that it “has more users than there are smartphones in China.” It has reached this level of popularity in China because it isn’t just a messaging app; users can also book a taxi, or a restaurant and even pay the bill for dinner without leaving WeChat. Alongside, Alibaba, an innovation winner in the retail sector, these are the two most valuable companies in Asia. BBK is in the smartphone market and one of its innovations is targeting the rural areas of China with solid, low cost mobile handsets. This approach has given them domination of the Chinese market: BBK sells through 200,000 independent retailers who receive healthy commissions for sales in this historically untapped market. As you can see, Asia features prominently in mobile communication innovation.

Open Whisper’s Signal app

Open Whisper Systems and its Signal app is another winner. Its open-source protocol, “which ensures messages are visible only to their intended recipients, is used for confidential messaging in apps collectively installed by more than 2 billion users.” The business has achieved this without ever placing an ad or having a marketing budget. It relies on just a handful of staff paid with funds from grants and donations, as well as code contributions from a worldwide community of developers and users. This is an extraordinary achievement and certainly deserving of an innovation award.

So, innovation comes down to who you ask. As the Global Innovation Institute says: “Ultimately, innovation effectiveness has to measure actual, real value delivered to the marketplace (customers) and the innovation–based growth that happens inside of companies as a result of that.”

Who would you nominate as an innovative company based on the above criteria?

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