Digitalscouting interviewed Fintech influencer Alberto Garuccio. He shared his insights about about the needs and opportunities in Fintech and Insurtech for the coming years.
Learn his tips, do's and don'ts for traditional banks adhering to the innovations of Fintech.
How are you today, what's keeping you busy these days?
I’m feeling very well, thank you. It’s a very busy period because I’ve started for 2 weeks a new professional experience at Reale Lab 1828, one of the first innovation center here in Italy.
In the meantime, I’ve started 3 new experiences as a Mentor at Italian Chapter of Enactus, top worldwide social innovation network, Founder Institute, the world’s premier pre-seed startup accelerator based in Silicon Valley and Young Women Network, the first Italian network dedicated to young talent empowerment.
How would you explain to a 10-year-old kid - what is fintech and how does the digital transformation is affecting today's banking in terms of business models, products and services?
Good question! I luckily have a 10-year-old daughter, Susanna, so I tried to do it in the past. In my opinion, the main concept to explain is the convergence of CX and UX experiences. Digitalization affects in the past many sectors, starting from entertainment to commerce and sons. We could mention many transformation examples that a kid can easily understand (Fortnite, Netflix, Youtube, Amazon).
People changed their habits and expectations, and today they want the same evolution affects financial services. Basically, Fintech is the same pool of technology and digital solutions applied to Financial Services to boost digital transformation process.
Over the last 12 months, how was the fintech ecosystem? What use cases and innovations that interested you the most?
Over the last 12 months, the fintech ecosystem fostered cooperation between incumbents and startups. Fintech startups are rebundling products and services ahead of their maturing customer base, move from mono-line to multi-line offering. There are many international use cases of this trend, Revolut, Wealthfront, Acorns, Robinhood, Coinbase and, last but not the least, Oval money and Satispay here in Italy.
What are your views to those who said that connections between insurtech and fintech are blurring?
I partially agree with them. In my idea, insurtech services are one of the most interesting pillars to complete financial service offering and assure an additional revenue stream to fintech startups or digital incumbents, first of all, Neo or Challenger Banks.
From the other hand, there are many insurtech or fintech solutions that solve a specific problem of their industry. In this case, connections are less obvious. For sure if we looking to technologies, we find many ties between them, without clear boundaries.
What are the topics to watch out for fintech and insurtech for the next 10 years?
In my view, mega trend changes will drive more than technology evolution (AI, blockchain, and sons) the Insurtech and Fintech market development for the next 10 years. There are a lot of topics that deserve to be analyzed, for instance, the growth of new risks with a global scale, primarily those generated by climate change, requires financial operators, especially insurance companies, to review their risk models. The need to generate a stable "financial resilience" leads banks and insurance companies to reduce exposure to risks and to reorganize core activities, also due to the effects generated by the pressure of the new regulatory frameworks (Volcker, Basel III, Solvency II).
In the next 10 years will be relevant the ability of incumbents to enable the emergence of new ecosystems to offer services and to manage the relevant data generated becomes the prerequisite for providing an all-around consulting service that would otherwise be impossible.
In the end, from a generational shift point of view, millennials are destined to inherit the largest transfer of wealth in history, 30 trillion dollars over the next 30-40 years (only in the US between 2030 and 2045, 10% of the total wealth will change hands every five years); future young adults (Gen Z) and future teens (Gen Alfa) instead have "learned from the mistakes" of previous digital generations and begin to develop a more pragmatic approach to social media, money, and work.
I am sure that all of these trends will create new fintech and insurtech needs and opportunities to achieve.
Please share your do's and don'ts for traditional bankers to fintech?
Traditional bankers must start from a bottom-up cultural transformation. Fintech is not only related to technologies. Then they have to set expected results from an open innovation strategy. Without a clear strategy and commitment, all transformational processes are really hard to manage. Last but not least, they have to keep in mind that innovation is not a linear process, so it is essential to accept mistakes and try to learn lessons from them.
On your own confidence, you think we as an industry have a chance with tech giants Amazon, Google, Apple entering the insurance industry - how and why?
I believe that the tech giants from the US and from China pertain to the “disruptor” category and that they may well be the winner at the end of the game.
The insurance industry suffers from 3 types of inertia: technology (the % of IT budget dedicated to true innovation is nowhere compared to the R&D capacity of the tech giants), social (how to enable tens of thousands of employees to radically change the way they work and build new types of relationships with their customers?) and cultural (how many leaders from the insurance industry see their companies as tech companies today?).
But war is not over and by partnering with innovators and fully embracing technology I believe that the insurance industry can reinvent itself.
What piece of advice can you share young people and startups who want to enter the fast-spinning world of Insurtech and fintech?
Find the best co-founders, build a team is mandatory! Spend the right time to analyze where is a real market opportunity, starting from identification of needs to solve, both for incumbents or for final customers, and definition of a win-win business model.
Be pragmatic and deliver the solution in short times, this is the only way to understand which the right way will be. In the end, do not forget to use time in an effective way and continue to boost personal skills, you need an elevated level of energy to win this big challenge!
To give a short personal impression: let us know what are your top 3 books everyone today needs to read and top 3 tech gadgets one needs to have?
There are many books that deserve to be read. If I have to suggest 3 of them, I could say,
- “Creativity: the human brain in the age of innovation” written by Elkhonon Goldberg, (available in Germany, in the US, in the UK, in France, in Italy and in Spain)
- “Bold: How to Go Big, Achieve Success, and Impact the World” written by Peter H. Diamandis and Steven Kotler (available in Germany, in the US, in the UK, in France, in Italy and in Spain)
- “The Blue Economy 3.0” written by Gunter Pauli (available in Germany, in the US, in the UK, in France, in Italy and in Spain)
I’m very addicted to tech gadgets and I use to test it. My personal top 3 list includes,
Alberto Garuccio, married, father of a 10-years-old daughter, Alberto is an innovation and financial service expert, art lover, mentor and he loves spending time with family and friends. He is a recognized between top 2018 European insurtech, fintech and innovation Influencer and industry leader with both innovation, banking and insurance experiences as a head of innovation and business leader in KPMG, Fiat Group Automotive, Banca Sella and Intesa Sanpaolo.
Winner of 2017 BAI Global Innovation Award in human capital at Intesa Sanpaolo Innovation Center, starting from the end of March he is innovation leader and governance manager at Reale Lab 1828, the innovation center of Reale Group, one of the most solid international players on the insurance, banking, real estate and services markets, protecting more than 3 million 800 thousand policyholders in Italy, Spain, Chile and Norway.
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