Shape of Things to Come(Dist).08.31 - NASCUS 1 Shape of Things to Come (608) 609-9478...
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8/31/17 1 Shape of Things to Come (608) 609-9478 [email protected] www.lassadvisoryservices.com NASCUS 2017 Summit San Diego August 30, 2017 John Lass, President Lass Advisory Services, LLC Ten Years Ago – Summer 2007 The Great Recession began The iPhone was born The Black Swan was published
Transcript of Shape of Things to Come(Dist).08.31 - NASCUS 1 Shape of Things to Come (608) 609-9478...
8/31/17
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Shape of Things to Come
(608) 609-9478
www.lassadvisoryservices.com
NASCUS 2017 SummitSan Diego
August 30, 2017
John Lass, PresidentLass Advisory Services, LLC
Ten Years Ago – Summer 2007
TheGreatRecessionbegan
TheiPhonewasborn
TheBlackSwan waspublished
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Advice from the Master
Note: Alsoattributedtoothers,includingDennisGaborandAlanKay
“Thebestwaytopredictthefutureistocreateit.”
PeterDrucker,1986
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Global Digital Landscape
2017 WORLD U.S.
Internet Penetration 50% 87%
UniqueMobileUsers 66% 83%
SocialMediaUsage 32% 78%
Web TrafficonMobile 51% 54%
Sources:BIIntel;Statista;GSMA;Hootsuite
Smartphones: 10 Years On
Source:BGR.Com;Nov.2,2016
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How Digital FinTech Began§ PayPalwasfoundedin1998
§ In2016PayPal:• Moved$354billionthrough190+countries
• Revenueof$10.8Bandcashflowof$3.2B
• 197millionactivecustomers
• Venmo (ownedbyPayPal)grew126%
§ PayPalhasneverbeenhacked
Source:BusinessWire, PayPal2016FinancialReport,January26,2017
PayPal Launched the “Platform” Strategy
DEMAND PLATFORM SUPPLY40MRiders Uber 1MDrivers100MUsers AirBnB 23MListings197MUsers PayPal 15MMerchants2MCampaigns GoFundMe 25MDonors2MBorrowers LendingClub $25BLoans
BASIC PLATFORM OBJECTIVECOMPONENTS• Software• Internet• Cloud• MobiledevicewithGPS
NETWORK EFFECT:“A phenomenon whereby
a product or service gains additional value as
more people use it.”
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“Ecosystem” Is The Next Step§ Alibabaisbuildingamassiveglobalintegrated“ecosystem”ofplatformsandservices• E-commerceplatforms:Tmall,Taobao,AliExpress
• Paymentsystems:Alipay
• Dataanalytics:Alimama
• Cloudservices:AlibabaCloud
§ Apple,Google,AmazonandMicrosoftareeachbuildinguniqueecosystems
Source:AlibabaGlobalLeadershipAcademyBlog;10/12/16
Creating the Future
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Elon’s Five Most Important Ways to Change the World
Source:Futurism.Com;September16,2016
1. Sustainableenergy
2. TheInternet
3. AI
4. Genetics
5. Interplanetaryhumanity
FinTech Comes of Age§U.S.FinTechtransactionvaluein2017willexceed$1Trillion
• Forecasttodoubleby2021
§ China’sFinTechmarketnowexceedstheU.S.
§ In2016over$20billioninvestedgloballyinFinTech
§ PitchBooktracks7,016FinTechs
§Morethan25FinTech“Unicorns”(>$1Bvaluation)
Source:PitchBook;Statista;CBInsights,January2017
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Inc.’s 3 Big FinTech Trends for 2017
Snappingupstartups:Acquisitionsofstart-upsbybanksisexpectedtobecomea“dominanttheme”
Valuationsgetgrounded:Afterflyinghighin2015,valuationsare“settlingbacktoearth”
Backtobasics:Innovationincorebankingsystems(e.g.“coreinthecloud”)seenashighlyattractive
Source:Inc.,ZoeHenry,January19,2017
Jamie Dimon on FinTech Investment
“Thereasonsweinvestsomuchintechnology(whetherit’sdigital,bigdata
ormachinelearning)aresimple:tobenefitcustomerswithbetter,fasterandoftencheaperproductsandservices,toreduceerrorsandtomakethefirmmore
efficient.”
JamieDimon,ChairmanandCEO,JPMorganChase&Co.LettertoShareholders– April4,2017
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Consolidation: SoFi Acquires Zenbanx – 2/1/17
§ Arkadi Kuhlmann andMikeCagneycombineforcestoreshapemobilebanking
Dominance of the “Big Five”§Halfoftheworld’stenmostvaluablecompanies§ Eachismovingoutsidetechnologytofocuson:• Autos,healthcare,retail,transportation,entertainmentandfinance
Source:NewYorkTimes;January5,2017
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Impossible, You Say?
Trending Up and Trending Down
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TRENDING UP
ArtificialIntelligence:AImarketprojectedtogrowfrom$650Min2016to$37Bby2025
StreamingMusic:Musicindustryrevenueisagainincreasingaftera20-yeardecline– duetostreaming.
IoT:Morethan6.4billion“things”areconnectedtotheInternet(excl.phones&PCs).Willgrowto50Bby2020.
DNASequencing:Costofsequencingagenomehasfallenfrom$100Min2001to$1Ktoday(99.999%drop).
P2PPayments:Projectedtotop$200Bby2020withmobileshareincreasingrapidly.
Source:FinancialTimes,February16,2017
TRENDING DOWN
Wearables:Thesectorhasfailedtoliveuptothehype.
Taxicompanies: CrushedbyUber– YellowCabofSanFranciscohasfiledforChapter11.
Majorretailers:Searsisexpectedtofileforbankruptcywithin12months.
Shoppingcenters:Morethan25%ofU.S.retailmallsmaybeclosed(1,150decliningto850overacoupleyears).
Oil:Isthisthelastcenturyforfossilfuels?
Source:FinancialTimes,2/16/17and4/10/17;BloombergJanuary29,2017
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Around the Corner: WHAT’S NEXT?
PassiveWi-Fi:Consumes100,000timeslesspowerthantraditionalWi-Fi(inventedbyUWstudents)
Li-Fi:Useslighttobeaminformation– 100XfasterthanWi-Fi.Lightbulbsactasrouters.
ArtificialGeneralIntelligence(AGI):Doesnothavetobetaughtaspecificskill,butlearnsasachilddoes.
Source:FinancialTimes,February16,2017
Robotics:Therealthreattothetraditionallaborforce.Evolvingatlightspeed.
RenewableEnergy:Nuclearfusion,artificialphotosynthesis,highaltitudewindenergy,andmore!
When Two Trends Meet: AI & Robotics
Source: ArtificialIntelligence:TheFutureofBusiness– Accenture,2017
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Benefits of AI in Banking – Happening Now
1)Enhancedcustomerpersonalization:e.g.Robo-Advisorsgeneratepersonalizedalgorithm-basedportfolioadvice
2)Productivitygains:Routine,repetitiveprocessescanbemadebothmoreefficientandmoreeffective
3)Frauddetection:AIisnowabletorespondinrealtimetopotentialfraud
4)Bettercustomerrecommendations:Offereachcustomertherightproductattherighttime
Source:TheFinancialBrand,January17,2017
Finie: The Financial Genie
“avoice-activatedintelligentpersonalassistantabletoanswerfinancialquestionsuniquetoeachuser,offerpersonalizedspendingadvice,andfulfillanybankingtask”
FinieUser:“Ilikehowyoucanjustuseyournaturallanguagetoaskanyquestionyouwant.”
Forbes:“ThisisthemostadvancedAIforthebankingindustry.”
Sources:Clinc.com;TheFinancialBrand,1/17/17
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Paradigm Shift?
Disruption of the Automobile
SAFEDRIVINGASSISTANCE
AUTONOMOUSVEHICLES
ELECTRICVEHICLES
SHAREDRIDES
INTELLIGENTGRID
TOTALDISRUPTION
ThisdisruptionwilltransformvirtuallyeveryareaofsocietyincludingFIs
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Aarian Marshall:The American Way of Driving is Over
“Fordecades,thecarhasbeentheall-Americansignifierofwhoyouare,adeclarationofindependence,aplacewhereyouaremaster.NowAmericaninnovationisleavingthistraditioninthedust.Ride-hailing,selfdriving,datamining:Technologyistakingthewheel.Enjoytheride.”
Source:WiredMagazine,February2017
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Intelligent Grid Will Link All Vehicles
How Apples Sees Automobiles
“Thecaristheultimatemobiledevice.”
JeffWilliams,AppleSVP
Source: TheStreet,December12,2015
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Elon Musk’s Master Plan – Part Two
1)Createstunningsolarroofswithseamlesslyintegratedbatterystorage
2)Expandtheelectricvehicleproductlinetoaddressallmajorsegments(trucks,buses,cars)
3)Developaself-drivingcapabilitythatis10Xsaferthanmanualdrivingviamassivefleetlearning
4)Enableyourcartomakemoneyforyouwhenyouaren’tusingit
Source:www.tesla.com;MasterPlanPartDeux
Mercedes’ “CASE” Strategy 2020
“Connectivity,Autonomousdriving,SharingandElectricdrivesystems– eachofthesefourtrendshasthepotentialtoturnourindustryonitshead.Yettherealrevolutionliesinintelligentlylinkingthesefour.”
Dr.DieterZetsche,CEOofDaimlerAG
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Intel Acquires Mobileye for $15.3 Billion§ IntelCEOsees$70Bself-drivingcarmarketby2030§ Eachcarwillgenerate4TBofdata/hourby2020!
Full Autonomy by 2030 … or Sooner?
Source:MorganStanley– BluePaperonAutonomousCars;November2013
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Source:MorganStanley– BluePaperonAutonomousCars;November2013
Potential Impact on U.S. Economy
Paradigm Shift?“Ifyouthinkpersonalcarswillsurviveasstatussymbols— remember,horseswereoncestatussymbols.”
SimonKuipers,FT
Source:FinancialTimes,November2016
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Auto Disruption: Discussion Points
1. Howwilltheseshiftstransformsociety?
2. Arethesetrendsathreattoautolending?
3. Willtheyopenupnewlendingopportunities?
4. Whatistheimpactoninsurancesales?
5. Whichjobcategorieswillbeimpactedmost?
6. Howfastwillthistransformationoccur?Whatcouldimpedethesetrends?
Amazon Reinvents the Bookstore§ AfterdemolishingBorders,WaldenbooksandB.Dalton,Amazonredefinesthecategory
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Not Your Traditional Bookstore§ Aperfectblendofdigitalandphysicalretailing§Digitallycurated – highlyefficient
An Efficient Omni-Channel Experience
§Nochannelconflict§Digitalsupportsstoreandviceversa
§Minimalexcessinventory
§MinimalstorefootprintandFTEcount
§Dataisakeyelement§Highlyscalablemodel
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Amazon Model Revives Indie Bookstores§ Independentbookstoresalesareup10%over2014§Utilizingprint-on-demandandInternetmarketing
How Jeff Bezos Sees It
“Thebookissohighlyevolvedandsosuitedtoitstaskthatit’sveryhardtodisplace.”
Source: FinancialTimes;2/16/17
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What Can CUs Learn from Amazon?
1. Dophysicalbranchesserveapurposeinadigitalworld?
2. WillMillennials continuetousebranches?
3. Howcandigitalsupportphysical,andviceversa?
4. WhatdoestheoptimalCUdistributionchannelmixlooklikein10years?
John Lass, President
(608) 609-9478
www.lassadvisoryservices.com
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