Making the Move from Wall Street to FinTech Part I

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New 4 Part Series

FinTech-the modern American dream. Since so many professionals are leaving or want to leave the Street, we decided to dig into what a job seeker should consider when thinking about the move. I have helped many in this transition, so I would like to share some lessons learned. This 4-part series will cover:

  1. Definition of Fintech
  2. Target company size
  3. Target company roles
  4. Expected compensation

This series will cover finance-related professionals from Wall Street and will not address IT personnel. We will cover IT professionals in a subsequent series.

Part I: Definition of FinTech

First, the question you must ask yourself is what is FinTech?  Ask 10 FinTech professionals and you will get 11 different answers. “A company combining finance and technology to create products and services” is hardly helpful for job search.

Second, almost everyone would agree that PayPal, Stripe, and Credit Karma are FinTechs. What about Visa, MasterCard, Bloomberg, Refinitiv? Maybe or maybe not, depends upon where you sit.

Awkward Definitions

FinTechs are companies that are B2B, B2C or B2B to B or B2C to B (BBBBBBB to CCCCCCCC).  I’m confused already.  Corporations that make products for Wall Street or Main Street? How about companies that are private, public, SPAC eligible, etc.?

Are FinTechs companies less than 5 years old or run by 25-year-olds?

Cleanest Definition 

I credit CB Insights with the most comprehensive FinTech information anywhere, at least for free. They classify FinTech companies into the following 19 sectors:

  1. Accounting/Finance
  2. Asset Management
  3. Business Lending/Finance
  4. Capital Markets
  5. Core banking and Infrastructure
  6. Credit Scoring/Analytics
  7. Crypto
  8. Digital Banking
  9. Financial Services/Automation
  10. General Lending/Marketplaces
  11. Insurance
  12. Mobil Wallets/Remittances
  13. Payments Processing/Networks
  14. Payroll/Benefits
  15. Personal Finance
  16. POS/Consumer Lending
  17. Real Estate/Mortgage
  18. Regulatory/Compliance
  19. Retail Investing

While the list may still seem daunting as areas for your job search, understanding them is a hallmark of a strategic, customized job search plan. Think of any FinTech-virtually all fit into one of the categories above. However, the tricky thing is that many fall into multiple sectors.

How about PayPal and all its competitors?  We all know them as payment processors. However, as a small business, Mike Mittleman Career Coaching is bombarded by PayPal with offers to borrow money or manage my cash account. Looks like a bank!

Which sectors are best for Wall Street professionals?

From studying historical movements of Wall Street professionals, I conclude the best sectors are:

  • Asset Management
  • Business Lending/Finance
  • Capital Markets
  • POS/Consumer Lending
  • Real Estate/Mortgage
  • Regulatory/Compliance

While a good business development professional can work in any of the 19 sectors mentioned above, the shortened list is best for the rest. These are the areas where subject matter expertise is valued more than coding skills which most Wall Street finance professionals don’t have.

All of the sectors on the shortened list above have their roots in traditional finance and markets where Wall Street occupies now. Many of the FinTechs in the shortened list tend to be large and/or public institutions like:

  • Prosper
  • Affirm
  • SoFi
  • Lending Club
  • Zillow
  • On Deck Capital
  • Wealthfront

Bottom Line

In conclusion, your job search is hard enough.  Using the CB Insights sector breakdown can start to guide your search. Stay tuned for Part II.

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