Edited and prepared by Oscar Michel, Masters in Journalism, DCU
Interesting interview with Spiros Margaris –
#VC & SA @insurescan @kapilendo_AG @moneymeets_com | SA @dsergmbh @F10_accelerator @FinTechForum_DE @werthstein | No.1 #Fintech & No.2 #InsurTech by @Onalytica
See Spiros’ website “MargarisAdvisory” here.
How is it going since we last spoke with you? For those who don’t know about you, how would you describe what you do?
Many things have happened since you interviewed me for Irish Tech News in March 2016. I invested in 2017 in a great insurtech company in the U.S. called InsureScan.net. With my existing fintech investments Kapilendo.com (the only full-service funding marketplace in Germany) and moneymeets.com (German “Fintech Supermarket”), we were able to close substantial new funding rounds, and I’m involved with the fintechforum.de (the first and largest hub for fintech in Continental Europe). I also took on several new advisory roles with very promising fintech companies, namely dser.de (B2B German fintech company), Werthstein.com (unique Swiss digital wealth management company) and f10.ch (fintech incubator and accelerator sponsored by SIX, the backbone of the Swiss financial centre). Some more exciting things are in the pipeline for 2017, but I’d rather talk about them when the deals close. I guess I’m a little superstitious.
To answer your second question for those who don’t know what I do, basically I look as a venture capitalist, for investment opportunities within the fintech and insurtech space. I advise startups, financial institutions, insurers and tech companies on their fintech and insurtech strategies. I use my social media activity—primarily my Twitter handle @SpirosMargaris and my LinkedIn account channel—to share some of the great thoughts of the great authors I come across when I conduct my research and who I believe will impact our industry. Then I also speak at think-tanks and conferences to help advance the fintech and insurtech industry as much as I can.
What projects are you involved in right now and what excites you in the future?
One of my recent investment involvements, as I mentioned before, is in the U.S., and it is the insurtech startup InsureScan.net. What I love about this insurtech company is that the CEO and founder, Mark Chappel, has put together a great team of very experienced insurance and tech people, and they have a great digital insurance proposition. Furthermore, what I liked a lot about this insurtech startup is the fact that they have an existing agent distribution channel in place, which many startups don’t have but would love to have.
To your second question about what excites me right now about the future, we’re in a fantastic time where incredible and great things in technology are happening and, more importantly, will happen, which will change businesses and our lives forever. It’s wonderful to be a little part of this great wave of change.
You have been ranked No. 2 Banking Expert by Klout, No. 1 Fintech and No. 2. InsureTech Expert by Onalytica and No. 11 Artificial Intelligence (AI) Influencer by Jay Palter Social Advisors and regularly appear in the top three positions in several industry rankings. Which expertise fascinates you the most and why?
Fintech, insurtech and AI all work together, so I can’t say which one fascinates me the most. Actually, I believe that we all should stay flexible for new ideas and trends so that they can flow into our thinking. Of course, I come from the fintech industry I love, but I believe that technology should be mixed, like cooking ingredients when you cook. Sometimes you use more pepper, sometimes more salt and the great restaurant chefs mix things in a way that can create magic. That is what I look for when I follow fintech, insurtech and AI trends to find people, startups and ideas that together in the right mix can create magic.
How can you see if a startup is promising or if it isn’t?
Of course, the obvious statement—which also in my view is very true and an important element to a startup’s success—is the team, their experience and their ability to execute and understand the industry they want to change or enhance.
Then I look for teams that know how to sell their idea to their customers, and of course, win them, because without sale there is no startup future. In other words, the team must have shown that they can close deals and win clients, rather than just say ‘we will once we have the money’.
Then comes the most important element, the so-called ‘great idea’ too early to be adopted successfully by the market. Because no matter how great the team and ideas are, if the timing is off then you’ll run out of money and support before your dream can happen.
Last but not least, does the startup team understand the importance of creating a strong brand to distinguish themselves from other great competitors? If you don’t get notices, it’ll be very tough to attract talent, money and customers.
Why should someone invest in Artificial intelligence? Is it a growing sector?
They are two ways to look at investing in AI: as an investor in startups or as a company investing in AI technology to gain a competitive advantage.
For the investor part, I agree with Frank Chen, a partner at Andreessen Horowitz, that if a startup’s claim to fame is only that they differentiate themselves from the competition by using cutting edge AI and machine learning algorithms, then that startup will not cut it anymore in the future. The reason is simply because everyone will use all kinds of AI solutions to compete—it will not be a competitive advantage but a requirement. Do you hear anyone saying they use electricity as a competitive edge?
As a company, there is no way around investing in AI to stay competitive, but it’s only one part of the success puzzle. A company still needs to have a compelling business case that attracts clients, but AI, machine learning and deep learning for sure will be part of the equation to compete successfully in their space.
As a No. 11 Artificial influencer, what is your role in this business?
Because I believe, as I mentioned above, that every business will need to use some AI solutions to stay competitive, to me it is essential to be part of and follow the AI space closely and to evaluate how it is, could or will be used in the fintech and insurtech space. I do exchange my thoughts frequently and closely with some of the AI thought leaders and scientists. The insights I’ve gained flow into my evaluations of companies and recommendations to my clients.
A recent article was written on how AI can influence customer experience. What other sector do you think AI can influence?
Instead of AI, I’d rather call it the influence of machine learning (a subfield of AI that allows computers to automatically learn from data without being explicitly programmed to act accordingly) or deep learning (a subfield of machine learning, inspired by the human brain and based upon artificial neural networks). The impact of machine learning and deep learning will be felt everywhere you can think of, such as cyber security, risk management or, to go a little bit further, even to develop new business models we have yet to conceive.
So, AI through machine learning and deep learning will eventually become the entrepreneur of the future—and we humans need to compete against it. Many very smart people will try to determine whether this is a good or a bad thing. I’m afraid that we’ll only find out when we’re there–in other words, when it might be too late.
Tom Simonite wrote the article (wired.com 07.12.17) “AI and ‘enormous data’ could make tech giants harder to topple”, do you think AI will one day become dangerous? Why?
I think what Tom Simonite wrote about the power of big data is an issue and, of course, it makes it harder for non-tech companies, such as financial institutions or other companies with less data collection capabilities, to compete against them. That doesn’t mean it’s not possible, as the article also pointed out, for companies and startups to compete against the giants, but they’ll need to deploy machine learning algorithm and different data sets. In other words, companies must focus on data not collected by tech giants or where the giants don’t have access, in order to gain a competitive advantage.
One cautionary note for the tech giants is that if they don’t treat their data advantage carefully, I could foresee some regulators stepping in to bring things into balance again. As much as we all would hate it when regulators must step in, it would be good to have this fear for tech giants in place to keep them honest and fair when they compete. However, I would highly recommend to any company not to hope that regulators will save them from the tech giants because any regulatory measure might come too late—or not at all.
As long as a company stays innovative and takes risks, there are ways to win against anyone. What I always tell companies and startups to remember is: ‘You can’t overtake anyone by following in their footsteps!’
#Fintech entrepreneurs remember that
you can't overtake the incumbents by following their footsteps! pic.twitter.com/xLGDacTmsz
— Spiros Margaris (@SpirosMargaris) November 7, 2016
You seem to be quite interested in cyber security. Why do you think it is such an important issue?
Cyber security is probably the most important issue that small and big business need to focus on going forward. A cyber attack will hurt a big business because it will be potentially costly, and the reputation and trust of the institution will suffer from it. However, for startups, regardless of their brand strength and quality of services, a cyber hack will likely destroy them, because they don’t have the money or reputation yet to survive it.
There’s no way to protect anyone from a cyber attack unless you unplug your devices and systems from everything—but then how effective will you be as a business? So, the best advice I can give everyone is to make the protection hurdle higher for attackers to be successful, so that, like with home robbers, they will look for easier targets. That doesn’t sound very encouraging, but I believe it’s the only way forward for all of us. Let’s get used to it and keep preparing against attacks as good as possible.
What makes you such a global fintech and insurtech influencer? Is it the fact that you are invested successfully globally in this space, or that you had founded two startups in NYC, or that you worked in the banking and hedge fund world, or that you share your innovation ideas on your blog or interviews or what is it?
I guess all of the above mentioned by you helps to gain credibility with my great followers/audience. Being an influencer is not primarily about sharing your thinking through articles you write—as many believe—but much more importantly listening to other ideas, crediting those authors, and sharing their thoughts in the wonderful fintech and insurtech communities that makes it all happen.
I firmly believe that one of the most important elements of being a true influencer is helping others. The actor Kevin Spacey said it beautifully: ‘If you’re lucky enough to do well, it’s your responsibility to send the elevator back down.’ People who know me well know I like to live by this wonderful quote and do my little part sending the elevator down whenever I have an opportunity. In many ways, magic happens when you do send it down. We all have to remind ourselves to send the elevator down, and more importantly, actually to do it. It sounds so simple to be an influencer, but it takes a lot of work, empathy, and respect for other people’s thoughts and contributions.
Please remember shining light on others is paramount in our #Fintech space.
As @KevinSpacey beautifully said
If you're lucky enough … pic.twitter.com/S4rjQDktRl
— Spiros Margaris (@SpirosMargaris) April 26, 2017