Finance is often the last sector of the economy to embrace new technologies, preferring to shield it from tech booms that may lead to ruin. This caution hasn’t served Wall Street well in the past decade, however, because the industry has lost touch with the changing demands of the next generation of consumers, savers and borrowers. Much of that disconnect can be attributed to the increasing emphasis on regulation, but regardless of the cause, Wall Street fell asleep at the wheel while young entrepreneurs figured out how to reinvent finance for the era of the Now, the Cloud and the Crowd.
The Now
Most of Wall Street services and processes were engineered back when people had time and patience. That is so 1999. The Millennials are a generation defined by instant gratification. (We can thank Steve Jobs and weak parenting for that). Click. Done. Wall Street as an industry is still emerging from the seventies. Understand for instance it still takes three full days for a trade to settle in the US. There is so much legacy infrastructure and processes, layers upon layers of interconnected systems technology and software, much more manual intervention that you would dare to imagine, encumbered by massive regulatory constraints. Wall Street cannot do anything quickly and this has created a huge impedance mismatch with a millennial generation that does not give a damn about mahogany-lined conference rooms and certainly doesn’t want to talk to anyone about their investments. If Millennials want to open an account, they want to do it now! If they want to trade, they want to trade now. Don’t ask them to sign and fax a piece of paper to open their account because you lost them at paper.
The need for the Now is hitting all facets of the industry: money transfers, banking, lending. But nowhere is it more disruptive than in the area of wealth management. Financial advice used to be about personal relationships. Many believed this would never change. But today Robo-Advisors are threatening the industry. Now that software has been eating the world for a few years, you can delegate advice to a machine. Companies like Wealthfront, FutureAdvisor, Betterment and SigFig have all built-in - to a degree or another - instant gratification around their services. And customers are gobbling it up. Personal Capital just released its app on the Apple Watch this week. Wealth Management is now unified with the one device that is the embodiment of the Now.
Sure, the fact that Millennials have yet to experience a market downturn suggests that they will come crying to their human advisors at the next correction. But I doubt it. I predict that the so-called “robo-advisor” platforms will manage 15% to 25% of retail investable assets within 5 years.
The Cloud
We have been beating the Cloud drum for years now. Amazon Web Services is now a $5B business growing 50% a year. But why is this more relevant than ever to Wall Street?
The industry should have figured out how to take advantage of the public Cloud to eliminate the billions and billions of dollars it needs to shave from its cost structure. Instead, everyone builds the same technology infrastructure, deploys the same software, operates the same data centers, and builds up the same layers upon layers of brick-and-mortar technology to operate an industry that is essentially virtual. Spare a few ATMs here and there and you realise that from banking, to lending, to wealth management, to capital markets, the financial services industry is essentially perfectly suited for the ether, ideally positioned for taking advantage of the mutualised technology infrastructure offered by the public cloud. But it has wanted none of it. Why? The usual demons of security and regulation.
But startups don’t have that problem, unburdened by regulation, fueled by organic kale, yoga lessons while-you-work, and free lunches, they have embraced the cloud. I deal with fintech startups every day and we have hundreds of them as clients. They all pretty much run on Amazon Web Services. The public cloud and Amazon Web Services in particular, is the operating system of the future. A global processing infrastructure on a stick. Wall Street is fooling itself if it thinks it can beat Amazon at this game. The dice have been thrown.
The next generation of financial service companies—those who will be giving Jamie Dimon a run for his money - are being built on APIs and the cloud (itself a big API). And they will benefit from a massively smaller cost structure than their legacy competitors - which in the end will seal their success. It’s not only financial services firms that are being re-invented on the cloud, it is all their network of retail and institutional service providers. When your arm dealers are switching to the next generation technology, it’s time to renew your arsenal.
Nowhere is this problem more visible that in the sector served by my company, Xignite. The market data industry is a $26B market where most of the money is spent on proprietary technology inherited from the 80’s and 90’s and where redundant infrastructure spending is pervasive. Every single financial institution spends billions of dollars on the same technology as its competitors but draws very little competitive or service advantage. The public cloud and its lower cost structure is a lifeline that Wall Street must grab now.
The Crowd
Finally the biggest premise underneath Wall Street is also being challenged; that is has to be run be a set of gigantic highly leveraged, highly centralised, too-big-to-fail, century-old institutions to even work. New technologies have simply shattered that assumption with the unbundling of the bank as obviously the first step. Who needs a large bank providing a set of mildly integrated, average-quality services across the board when a crowd of new technology companies are able to provide a set of best of breed services all running in concert on the same device? Or when companies like Yodlee are able to provide those startups with an integrated view of the customer’s asset via easy APIs no matter where those assets are held. There is not a single sliver of service or technology infrastructure provided or used by large financial institutions today that is not under attack by dozens of startups worldwide. Take for instance Tradier who can provide you with a complete set of brokerage APIs to build your business upon. Ten years ago, doing this would have taken month and cost millions whereas now, a brokerage business can be built overnight. Sure not all startups survive but many will and have already changed the industry forever.
And this not only applies to consumer-facing services like money transfers or savings accounts, it also applies to some core internal supply chains of the capital industry where the power of the Crowd is successfully applied to create alternative sources to Wall Street traditional fare. Estimize for instance, is applying the wisdom of the crowd to the earnings estimates and being very successful doing so - challenging big vendors like Thomson Reuters on a turf that is literally the beating drum of the markets. Vetr is also drawing upon the Crowd to rank stocks in a fashion similar to the way Morningstar built its famous star rating for mutual funds. Example abound in more obvious categories such as crowdfunding with companies like Kickstarter, Crowdnetic, Funding Circle, LendingClub and dozens of others worldwide.
There used to be a distinction between Wall Street and Main Street and at times their interest have not aligned. One of the biggest strength of Capitalism is its ability to self-improve. Today, Main Street and Wall Street are merging and they are leveraging new technologies to give the next generation what they really want: everything, right now, and for less.
Source: Bob's Guide
Partners with ESG Book to Drive Investor Sustainability Engagement
SAN MATEO, Calif., April 12, 2022 /PRNewswire/ -- Xignite, Inc., the leading provider of market data APIs to brokers and wealth managers, announced the launch of a new Environmental, Social and Governance (ESG) data API in partnership with ESG Book, a global leader in ESG data and technology. Xignite's brokerage, wealth, and media customers can now increase user engagement and retention with state-of-the-art sustainability trading products.
As ESG investment has gone mainstream, today's digital investors, institutional investors, and corporations alike require ESG data to help them answer questions that range from a company's workforce diversity to its commitment to a net zero future. In this context, brokers and wealth managers can use ESG data to increase client engagement around their portfolios and differentiate their offerings in a very fragmented marketplace.
"We are thrilled to extend our highly scalable and advanced API platform to include ESG Book's real-time sustainability dataset. With the recent SEC announcement of proposals for climate disclosure, the momentum for sustainability data in the U.S. just keeps on building. If you do not offer ESG data and portfolio analytics to your clients today, you will run into growth and retention challenges," said Stéphane Duboi, the CEO of Xignite.
Dr Daniel Klier, CEO of ESG Book, said: "As capital markets transition towards a more sustainable, net-zero future, demand for accessible, comparable and transparent ESG data has never been higher. We are delighted to be partnering with Xignite, a global leader in API solutions, to deliver our real-time ESG data products to clients at both speed and scale through the latest cloud technology."
Xignite's new ESG API is designed to fast track the launch of ESG powered products. Transparent, well-structured and easy to understand ESG datasets eliminate the need for robust in-house ESG expertise. Advanced screener endpoints further simplify development by eliminating the need to maintain a database.
XigniteGlobalESG API covers a comprehensive universe of public companies domiciled in North America, EMEA, APAC, and Latin America. In addition to ESG scores, this API provides Global Compact scores, involvement data, temperature scores, and raw emissions data.
About Xignite
Xignite is the leading provider of market data API solutions to brokers, wealth managers, and the tech firms who serve them. Xignite has been disrupting the market data industry from Silicon Valley since 2003 when it introduced the first commercial REST API. Today, more than 700 firms use Xignite's APIs more than half a trillion times a month to deliver high-value data to digital investors. Visit xignite.com or follow us on Twitter @xignite.
About ESG Book
ESG Book is a global leader in sustainability data and technology. Through a cloud-based platform, ESG Book makes sustainability data more widely available and comparable for all stakeholders, enables companies to be custodians of their own data, provides framework-neutral ESG information in real-time, and promotes transparency. It counts many of the world's leading financial organisations among its clients, which collectively manage over $120 trillion in assets. www.esgbook.com
04/12/2022
Sales Up 50%. API Volumes Now Exceed Half a Trillion per Month.
Xignite, Inc., the leading provider of market data APIs to brokers and wealth managers, announced that 2021 was a banner year for its business. Xignite experienced more than 50% growth in new client bookings over 2020. Most of this growth was fueled by heavy demand from new brokerage and wealth management applications as more firms entered the business. Xignite also saw a 53% increase in API consumption to a whopping half a trillion requests a month - driven mainly by increased activity from digital investors as they consumed more and more data during the pandemic.
The Digital Investor Revolution was created by the convergence of zero-cost trading, fractional shares, working from home, the pandemic, and the emergence of a new and more powerful generation of retail investors. This has created significant momentum in trading and wealth management, primarily US-based equity and options trading. And it has fueled the entrance of a considerable number of new prominent players in the field, especially embedded finance providers. It all came to light in early 2021 with the Reddit and Gamestop phenomenon. But it has not proven to be short-lived. The transformation could be profound. Indeed Xignite saw its momentum accelerate in Q4-2021, with bookings growth exceeding 310% over the same quarter in 2020.
“Xignite is one of the oldest and most scalable commercial API infrastructures globally. It’s not a surprise that our clients have grown to rely on us for their mission-critical business needs,” says Stephane Dubois, Xignite’s CEO and Founder. “It’s not only the mind-numbing volumes that we have to deal with,” adds Dubois, “It’s also the 4-nine+ level of availability we deliver day in and day out coupled with the awesome market data quality and the high touch responsiveness of our support teams. These metrics matter to large embedded finance firms entering the business or legacy firms migrating to the cloud. They spend tens of millions of dollars entering the business. They don’t want to see it evaporate because of poor data quality or API availability.”
About Xignite
Xignite powers the investing apps and services that enable millions of people to manage their portfolios and trade stocks from a phone or tablet with the industry’s best financial market data APIs. We help more than 700 fintech trading, investment, and analytics firms like Robinhood, SoFi, and Betterment provide digital investors with the market data they need, such as real-time stock prices and company news. Visit xignite.com or follow on Twitter @xignite.
03/10/2022
Xignite, Inc., the leading provider of market data APIs to brokers and wealth managers, announced the launch of a new cryptocurrency data API. Xignite’s brokerage, wealth, and media customers can now increase the value and stickiness of their services to digital investors by taking advantage of the depth and breadth of data offered by this API.
Investment in cryptocurrencies has increased dramatically over the last few years and has proven to draw new investors into the world of trading. As a result, brokerage companies are trying hard to make buying, selling, and holding Bitcoin (BTC), Ethereum (ETH), Dogecoin (DOGE), and other cryptocurrencies as easy as possible for their clients. The XigniteCrypto API is the first to bring together a vast universe of cryptocurrency information alongside the equity, ETF, and option data brokers and fund managers need to offer high-quality services to their clients. It also provides the depth of functionality required for them to engage customers and drive trading activity
“Cryptocurrencies tend to operate in their own world,” said Stephane Dubois, CEO, and Founder of Xignite. “This means that if you want to offer integrated equity, option, and crypto trading or analytics for your clients, you are going to have to cobble up a lot of heterogeneous data from many disparate sources, and that’s a pain,” adds Dubois. “With our new crypto API, you get the depth of coverage, the quality, and the reliability across all asset classes you need to grow your business - all in one integrated solution.”
Xignite’s new cryptocurrency API, XigniteCrypto, provides real-time and historical quotes for over 900 cryptocurrencies, including coins and tokens. It includes unique API endpoints that help firms engage digital investors, using the data and tools they need to make crypto trading decisions, including price alerts, historical charting, currency conversion, and cryptocurrency news.
About Xignite
Xignite is the leading provider of market data API solutions to brokers, wealth managers, and the tech firms who serve them. Xignite has been disrupting the market data industry from Silicon Valley since 2003, when it introduced the first commercial REST API. Since then, Xignite has continually taken advantage of new technologies to help its clients grow their business and serve their customers better by using financial market data effectively. Today, more than 700 firms use Xignite’s APIs more than half a trillion times a month to deliver high-value data to digital investors. Visit xignite.com or follow on Twitter @xignite.
02/15/2022
Xignite, Inc., a cloud-based market data distribution and management solutions provider for financial services and technology companies, announced a new Vendor of Record service for clients subscribing to real-time and delayed market data. The new service vastly simplifies the administration and reporting required by exchanges and often eliminates the need to pay redistribution fees, potentially saving clients thousands of dollars a month.
As an approved Vendor of Record, also called a Service Facilitator, Xignite can redistribute real-time and delayed equities and options pricing data from Nasdaq, New York Stock Exchange (NYSE), Options Price Reporting Authority (OPRA), OTC Markets (OTCM), and the Toronto Stock Exchange (TSX).
Adhering to the complex compliance guidelines required by exchanges is extremely difficult for investment advisers, financial advisers, or order management software providers that need to display real-time or delayed data. Each exchange has its own unique set of regulations and compliance requirements, and clients need to prove that they have control over who receives the data, in what format, and for what use case. Xignite’s Vendor of Record service eliminates the administrative burden of tracking these complex compliance requirements.
The new service utilizes Xignite’s cloud-native Entitlements and Usage Microservices to give firms complete control and transparency of their data consumption and usage. Xignite provides data entitlements, usage tracking, and exchange reporting across various data sets, users, and applications to ensure exchange compliance. Xignite’s new service sometimes eliminates the need to pay expensive redistribution fees. Exchange fees for display data, regardless of the number of users, can cost upwards of $10,000 per month. These high fees are especially difficult for smaller financial firms with just a few real-time data users.
“Maneuvering through the maze of required compliance policies, entitlements, usage tracking, and reporting requirements, and being subjected to frequent audits is no easy feat,” said Vijay Choudhary, Head of Product for Xignite. “Xignite’s mission is to “Make Market Data Easy.” Today’s announcement is another step towards this. We are taking away the administrative burdens and complexity of licensing market data and allowing our clients the freedom to focus on their investment and trading strategies and building innovative products.”
Xignite’s Vendor of Record service is available for professional users with internal and display-only use cases. The service is available now as an add-on service for subscribers of our real-time and delayed equities and options pricing data APIs. These include:
About Xignite
Xignite has been disrupting the financial and market data industry from its Silicon Valley headquarters since 2003 when it introduced the first commercial REST API. Since then, Xignite has continually refined its technology to help Fintech and financial institutions get the most value from their data. Today, more than 700 clients access over 500 cloud-native APIs to build efficient and cost-effective enterprise data management solutions. Visit xignite.com or follow on Twitter @xignite.
09/21/2021
