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Interviews

COULD ARTIFICIAL FINANCIAL INTELLIGENCE REVOLUTIONISE THE FINANCIAL SERVICES SECTOR?

An interview with Fahd Rachidy, Founder and CEO of ABAKA.

 

Engaging customers in financial planning for the future: what challenges does the sector face?

The UK population is ageing – by 2066, over 65s will make up over a quarter of the population. But many could be sleepwalking into retirement without the pension savings or financial plans in place to enjoy their later years. That’s why it’s more important than ever before for financial services providers to engage customers on planning for the future.

Financial services (FS) providers face various challenges when it comes to engaging customers on issues relating to their retirement. The constraints of legacy technologies and paper-based processes make it harder for the industry to get customers excited about planning for later life.

 

What fintech tools have emerged recently that can help the sector meet those challenges?

Artificial Financial Intelligence has the potential to have a transformative impact on the retirement market – particularly in the form of both conversational chatbots and intelligent nudges.

AI-powered conversational chatbots can help financial services companies to communicate with customers in more dynamic, self-service environments rather than sending customers 20-page statements that nobody reads. They enable financial organisations to offer hybrid advice solutions, where chatbots source preliminary information needed for validation and can categorise customers relative to their needs. In a world of hyper-personalisation, intelligent nudges are a powerful way to engage with customers when and if they need it.

All of this means that advisers can spend more time actually offering advice and building trust with their customers. Similarly, providers will be able to draw on more unstructured or behavioural data acquired by the bot, augmenting the interaction with a relevant pool of rich data and insight about the customer.

 

Fahd Rachidy

 

Can chatbots be truly ‘intelligent’?

Chatbots powered by natural language understanding – such as Abaka’s chatbot Ava – are adding real value to customers.  Alongside delivering human-like conversations and comprehensive product information, natural language processing allows chatbots to build an extensive range of appropriate, relevant responses. They can answer an expanding variety of questions in an engaging, genuinely conversational way. To add to this, interactions can be fully audited. This means that the solution can work in conjunction with third party services, further personalising and integrating the services being provided.  Used well, chatbots save time, money and improve the customer experience.

 

What immediate impacts could AI-powered conversational platforms have for FS organisations?

Providers have a responsibility and a commercial imperative to educate and guide our ageing population towards suitable retirement options. Intelligent chatbots can play their part by enabling providers to begin new conversations with a wider pool of customers.

Abaka has found that these services significantly improve customer engagement, opening up channels of communication and providing ease of access to information. Older customers are used to the technology – Facebook Messenger and Amazon’s Alexa, for example, are popular with older people.

Some older customers like being able to ask a machine questions without having to worry about whether they look silly or feel they should know the answer. Bots also empower customers to ask a question several times without fear of embarrassment.

Artificial Financial Intelligence is relatively simple to adopt, quick to scale and the ROI will be apparent in a reasonable timeframe. Chatbots and intelligent nudges are part of all of our retirement futures – we need to ensure that we use this technology in the best and most appropriate way to drive better outcomes for customers.

 

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Interviews

DIFFERENTIATION – THE KEY TO THRIVING IN A SATURATED MARKET

Graham Glass, CEO of Cypher Learning

 

What has enabled Cypher to continue to grow in an increasingly saturated market?

Recognising opportunities for growth around the world is actually one of the things that has helped us grow. We realized that there were so many opportunities outside of the U.S or Western Europe and actually, a lot of our revenue comes from outside of these regions. For example, with our education based LMS, NEO, we have schools and institutions in the Philippines, Latin America, Norway, Australia, and more. The way we have created the product allows the flexibility for it to be tailored to each educational institution’s exact needs and because of this process, we can provide different languages, different elements of learning and really help the teachers in each country make the most out of the system.

 

You have recently expanded into four more locations: Australia, Indonesia, Malaysia and Russia. What was the reasoning behind deciding on these locations?

The growing popularity of our learning platforms has made it possible for the company to expand quickly and cover more of the market around the world. The selection of the new sales offices came as a natural move, as we started to get more and more customers in those locations, and we wanted to seize the opportunity to expand even more. We also wanted to provide local support to our customers, which is an important aspect in our strategy. Since we already had an office in The Philippines, opening new locations in Indonesia and Malaysia was essential. In the case of Australia, since we launched the APAC version of our platforms, with servers hosted in Sydney, it was also vital to have a sales office as well.

 

What is different about your products compared to your competitors?

CYPHER LEARNING is currently the only company on the market that provides a learning platform for each e-learning segment: academic, corporate, and entrepreneurs. Our products are built on the same core platform. They share some functionalities and the overall design of the platform, but they’re targeted towards different markets. NEO is an LMS for schools and universities, MATRIX is an LMS for businesses, and INDIE is an LMS for entrepreneurs. For each of our products, we have created special functionalities that address the needs of each market.

Our platforms are very intuitive, easy to use, and visually appealing, which makes the whole experience more engaging and enjoyable for all users. The navigation is simple, and you can customize the platforms to match your brand and fit your needs.

Our platforms are built to ensure a smooth implementation and they’re easily adopted by students, teachers, trainers, and entrepreneurs. We offer support for 40+ languages, mobile apps for all devices, and accessibility features so all users can enjoy the platform.

CYPHER LEARNING products provide complete solutions with powerful features for managing all teaching and learning activities for schools, organizations, and entrepreneurs.

We’re also focused on bringing innovation through our platforms, by creating cutting-edge features that other systems do not support such as automation, adaptive learning, and competency-based learning.

 

How do you see the e-learning market changing and developing in the future?

I’m very excited about the future of the e-learning market. Machine learning and artificial intelligence hold great potential in terms of making learning truly personalized. We’re already on that path, taking steps forward with automation, multi-layered neural networks, feedback algorithms, amongst many other developments. And things will advance on a massive scale, rather quickly. With AI in online education, we’re not talking about 20 years until it will become the norm. Some of these technologies are going to be available and mainstream in the next few years. Keeping up with these changes and making sure the incredible amounts of learner data will be used correctly will be challenging, but I have high hopes of what the future has in store for us.

 

What advice would you offer other individuals and businesses in the e-learning industry?

We’re all in this together so we need to stay true to ourselves. In order to provide the best tools, the best solutions and the most memorable experiences that support people of all ages to learn new things, we need to keep on learning ourselves. That’s the only way to continued growth, both personally and professionally.

 

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Interviews

IPO: WHY GO PUBLIC?

By Sandy Campart

 

The main objective of an IPO – Initial Public Offering – is to raise capital in order to allow a company to grow. However, during a global economic slowdown, investors are increasingly cautious. In times like these, how should you prepare to go to the market?

 

Reasons for an IPO

A company’s motivation for going public is often linked to the idea of “creating one’s own currency” in order to fund internal and external growth, to diversify future sources of finance and strengthen the financial structure of the company. Listing a company on the stock exchange results in tradability and liquidity, allowing previous shareholders to exit, realising a gain on their capital. It also creates a valuation for the company which will be useful for future succession plans. At a strategic level, an IPO can enable the company to clarify its strategy, refocus its activities, increase its visibility and credibility, and ultimately differentiate itself from competitors.

Nonetheless an IPO will significantly change the way a company operates. Corporate governance has to be overhauled, support functions professionalised and financial communication must be made transparent. All studies show that, when information is withheld, the negative impact on the share price is greater than if the bad news had been announced.

 

2019: a mixed bag

In 2019, newly listed companies have seen their share price grow by almost 13% on average. However, the figures vary greatly. Software and IT security companies have performed the best with an average of nearly 40%.

Nevertheless, the stock market performances of SmileDirect (dental aligners), Peloton (exercise bikes and fitness) and even Uber attest to the increased scepticism of investors for unrealistic or exaggerated levels of profitability. Uber’s price has been particularly disappointing since the latest results presented were well below the expectations of the investors. In the second quarter of 2019, the turnover was more than 5% lower than expected and the profit – or rather the deficit – per share was 53% greater than expected. Uber’s growth has been slower than that of rival app Lyft, and the restructuring costs associated with many departures, lay-offs and resignations do not seem to be controlled. Additionally, Uber’s CEO, Dara Khosrowski, told his employees that the teams were too large to be compatible with the pace of growth needed, while Uber’s CTO, Thuan Pham, believes it could take decades for Uber to achieve its “vision”, suggesting there could be a later than expected ability to turn a profit.

 

Towards a better year in 2020?

For a company wishing wanting to maximise its initial flotation price, there are two strategies to pursue: the first is to float when the company is performing exceptionally, the second is to wait until the stock market is in a more favourable position.

In the context of a global economic slowdown, investors have for several months been moving towards “safe haven” shares in order to protect their assets. This, combined with the chaotic path of some recently introduced companies and the abundance of private financing, makes it difficult to see an acceleration of operations in 2020.

Even though the flotation of Airbnb remains topical, Postmates (delivery service) and Endeavor (talent agency) have paused their entry to the stock market. It is possible they are prioritizing interest from venture capitalists and risk capitalists. Palantir (Big Data) and Stripe (internet payments) could also look for private funds instead.

 

The WeWork failure

WeWork is the most prominent example of our current inability to distinguish a unicorn from a chimera. Investors have to learn – or re-learn – how to resist those appealing equity fairy stories and to see beyond the innovative nature and rapid growth of a concept. Cash flow, debt level and governance remain key decision-making factors. In the WeWork prospectus, the word “technology” appears more than 120 times. The Coué method of repetition is here being used to suggest that traditional valuation models should not apply to this business. There is little doubt, however that WeWork is more of a property developer with an innovative business model than it is a technology company.

 

About Sandy Campart 

Sandy Campart is a lecturer and researcher. He is a member of the Centre of Research for Economics and Management (CREM), part of the French National Centre for Scientific Research (CNRS). M. Campart is director of IUP Banque Finance Assurance de Caen – a finance school in Normandy – and author of “If we dared to invest in the stock market”.

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