Swede talk: Interview with Anders Bouvin, CEO of Handelsbanken UK

Square Mile Magazine, August 2015. Original article, p68-70.

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“That was the big revelation: Handelsbanken really is me.”

A Swedish voice greets me as I arrive at Handelsbanken’s UK headquarters, here to guide me to the corner office. The glass and steel building near the Tower of London is undergoing refurbishments and there are no signs anywhere, so a bit of hand-holding is necessary. Or maybe this is just Handelsbanken’s standard welcome? After some time in the company of UK CEO Anders Bouvin, I’m inclined to think the personal touch may be everyday procedure.

There’s a saying at Handelsbanken: “Why not do things the other way round?” Bouvin may have an office with a showstopping view from the Shard to the Eye, but that’s the beginning and end of any kind of flashiness. Bouvin is in charge of the UK operations of this Swedish institution from 1871, which is indeed known for doing things differently. In fact, most stories about Handelsbanken UK is about everything the bank is not: no bonuses, no sales targets, no marketing, no call centres, minimum central oversight. Then there’s the fact that Handelsbanken keeps opening UK branches at a time when peers are closing them – while at the same time having delivered a higher return on equity than its average competitor for 43 years.

Bouvin is friendly and straightforward when talking about his bank, if a little no-nonsense about it: Handelsbanken’s approach isn’t really anything new – it’s just the traditional approach of putting the customer at the heart of the operation. Bouvin’s Swedish accent is underscored by the occasional phrases that mark him as a Londoner; he’s lived in the UK capital since 2007. “We used to live in Wimbledon, but we moved into the city just a couple of weeks ago,” says Bouvin, who’s in a blue-patterned shirt and tie, jacketless on this hot day. It was the commute: “It’s 21 torturous stops on the District Line here from Wimbledon. Or put it this way: 21 planned stops, but you can add another four or five!”

About one eighth of Handelsbanken UK’s 1800 people work in this building, which comprises most of the UK head office, plus the South-East regional office – those branches are the green pins on the map on the wall. My first impression of hearing two Swedish voices turns out to have been a fluke though, as Bouvin doesn’t know how many Swedish speakers are in the building: “Oh we don’t count them! Maybe … 15?” The organisation has a very strong culture, says Bouvin, so you’ll find senior people from the Nordic region in the UK: “But we consider the UK a home market, just like Sweden. Here, we operate as a British bank and compete for British customers.”

Bouvin admits it can take some explaining for people to get what Handelsbanken is about: “We don’t really fit into the norm, so to speak, when it comes to how banks operate and how they organise themselves.” But that’s mostly an issue with bankers (and journalists), as customers get it right away: “When we explain to our customers, they understand immediately. That’s obviously what counts, isn’t it? Our values are very much common sense.”

Screen Shot 2015-08-06 at 14.14.04A different kind of branch
Handelsbanken now has about 200 branches in the UK, having opened about 20 per year over the past three. “We open a branch when we find the right person to lead it. That person has to convince us that he or she shares our values.” This is the ‘Church Spire’ principle: “We don’t micromanage branches from the centre. It’s all about empowering people to operate independently within the central principles.” This approach may be unusual in itself, but even more unusual is Handelsbanken’s steady pace of opening more branches at a time when competitors are closing them. I ask Bouvin about the rationale behind this, as competitors are pushing digital services. And with the tone of a patient man who’s clearly had to explain this a few times before, the CEO explains how Handelsbanken doesn’t buy into this narrative of the death of branches:

“This is not our experience at all. Our branches break even within 18 months – that’s proper breakeven, not subsidised. Our experience is that customers appreciate branches,” says Bouvin. But there’s a catch: Handelsbanken branches don’t operate the same way as your average branch: they look more like offices than High Street banks, for one, and staff are authorised to make decisions. “You have to operate branches in a way that customers can see they offer something. If that’s not the case, then you’ll probably feel branches are going out of fashion. … If you ask whether branches are still relevant in today’s society, our belief is absolutely! If you run them in a way customers want you to.”

This is interesting, I say to Bouvin, who interjects: “Isn’t it?” – but I still prefer using an app. “So do I!” says the CEO, as he kindly puts me in my place: Handelsbanken is no slouch on digital, it’s just that the conversation tends to focus on the growing branch network because it’s unusual. “The reason Handelsbanken is growing in one of the most mature banking markets in the world, is all about service,” says Bouvin, after he’s graciously listened to me complain about the agony of getting a mortgage from a competing UK bank. “Instead of building a bank with processes customers don’t like and have to adapt to, it should be the other way around! You should build a bank around what customers want. A satisfied customer is key to financial and commercial success.”

Sceptics will be interested to hear that Handelsbanken’s group profits reached a record high in 2014, which also explains why Bouvin takes no issue with being called traditional: “Our values are traditional! Being customer-centric, cost-conscientious, prudent and having a long-term view.” Bouvin won’t share his bank’s UK market share, “because we don’t really focus on market share, we focus on satisfied customers”. It’s small, he’ll admit, but it’s growing: “And that only fills us with enthusiasm.” There are no growth targets either of course: “We don’t do fixed planning, we don’t do targeting, we don’t … oh we could talk a lot about this. It’s ridiculous, trying to guess.”

Bouvin keeps using that word – we – as his point of view is also that of Handelsbanken: “We have a very strong corporate culture. We really do sing from the same hymn sheet.” He won’t even describe himself as the boss: “I definitely wouldn’t say, in any way, that I run the bank!” He laughs. “The head office’s role is to support the branches. My role is to make sure this system works, so that we don’t inadvertently introduce mechanisms that could disrupt this intricate system, I would say.”

A job for life
Britain is Bouvin’s seventh country of residence, and he refuses to pick a favourite. Nor is he especially keen on describing traits as a Swedish thing: what’s happening here is a Handelsbanken-specific phenomenon. Like how he recently visited the Clifton branch in Bristol, where the staff always take the bus to client meetings. The CEO practices this culture of thrift also personally: “I was at a Mansion House black tie dinner a few weeks ago. I took the Tube, as you do, but I didn’t see too many black ties on the train. But at the Mansion House there was a big, big queue of black limousines. I think there are thousands of stories like this in Handelsbanken. We try to do things in a simple, low-key way.”

Bouvin speaks passionately about the Handelsbanken ethos of working in a collaborative manner, avoiding pitting staff against customers in order to achieve targets: “I think it’s natural for people to want to do a good job. It’s natural for people to want to help each other. A big part of Handelsbanken is that we try our best.” Handelsbanken was actually Bouvin’s first job, joining fresh from the University of Lund at age 25. “I had some language skills and a somewhat international background, so they put me in the international division at the head office in Stockholm,” says Bouvin, who spent the first years of his life in Zimbabwe. Upon request, he modestly lists his languages: English, French, Swedish, Danish, and he gets by in German. The fact that his first job is also likely to be his only job was a fluke, though: “After three years, I started to understand what Handelsbanken is, and the values of the bank. … I was lucky! I had actually ended up in an organisation with values which are absolutely compatible with my own. That was the big revelation: that Handelsbanken really is me.”

Bouvin (56) is married with two children: “My son is at university in London, and my daughter is going off to study in Boston.” I ask if they’re on the path to become citizens of the world too, and Bouvin counters: “Who is a citizen of the world!” He doesn’t like the description: “I’m not sure about that. I mean, I am me!” He laughs. “I support Sweden in football and hockey. But you can put me in basically any country, and I will probably enjoy myself.”

I get the distinct impression the CEO would rather not talk about his personal life, so I ask him about the football shoe sitting by his desk: “That was Henrik Larsson’s. Do you know him?” Bouvin tuts when I say no. “He’s a famous Swedish footballer who also played for Manchester United.” The shoe seems tiny. “He’s not a very tall guy. But he is good! Small feet kick the ball harder, because the force is concentrated on a smaller area.” There’s also a Swedish Dala horse, and a Queens Park Rangers banner – the CEO stops to check that I know who they are: “I’ve always been a fan of QPR. Me and my son, we go there and watch them win, every now and then. And the trophy over there,” says Bouvin, pointing to a small golden cup: “Handelsbanken UK got that for being the best bank in the group for handling customer complaints.” He nods, pleased. “We had the quickest response times and best outcomes.”

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Dangers and Dragons: Interview with Piers Linney

Square Mile Magazine, October 2014. Original article p85-87.

linneyDangers and Dragons: Interview with Piers Linney
Piers Linney carries two business cards. “Day job,” he says, giving me the one that reads co-CEO of Outsourcery. “Night job,” he says, handing over the card that reads founder of Workinsight.org. Outsourcery is his cloud technology business, a true adventurer in the “land grab” for the rapidly emerging cloud market. This a prospect that Linney has so much faith in that he’s given up his salary for a year, as the company pushes towards victory and next year: profitability. But Linney’s equally keen to discuss how Workinsight.org can help young people gain useful work experience, and thorugh this, figuring out what they want to do with their lives. After all, what Linney is above all, is an entrepreneur.

Outsourcery’s London office is a modern outfit in Fitzrovia, suitably casual for a sporty tech company with no landlines and no suits. Linney is in a striped shirt and chinos, and yes, the serious-looking bicycle on the roof terrace outside is his. Later he shows me photos of his other bikes (he has six, all way too flash to leave locked outside a shop), as he has a hardcore mountain biking habit, the kind that requires actual body armour. If you fall off you’re in trouble, Linney admits, but he doesn’t fall off: “No I don’t, because I’m very good.” He lets out a big laugh, but he also means it. You don’t hurl yourself down a mountain unless you have guts.

Cloud or bust
You could say the same about giving up your salary for a year, which is what Linney and co-CEO Simon Newton just agreed to do. “We have put millions of pounds each into the business. We believe in it. The cloud is such a huge opportunity!” Linney adds that they have some stock options of course, but this is all about demonstrating confidence and pushing towards profitability, which analysts expect to see next year.

Outsourcery started positioning itself to become a choice provider of cloud-based unified communications back in 2009: “Few people at that time were making the investment we made. We invested tens of millions in the business, and I think we’re at the point now where you know the market is beginning to understand that cloud is very much the future.” Today, Outsourcery provides the back end for the cloud services for the likes of Vodafone and Virgin Media Business, and partners with the likes of Microsoft, HP and Dell.

If things go as planned, Linney will be providing cloud storage services to the UK government as well. “That’s why you get these J-curves [in earnings],” says Linney: “There’s no contract – we’re building the platform, and then we’re going to win the contract.” To that end, Outsourcery is working with Microsoft and Dell on building a high-security data centre on UK, as is required by the government. The national technology policy is on Linney’s side: all new projects should be cloud-focused, and the procurement chain should have a SME (small and medium enterprise) in it. Linney would know: he’s on the Cabinet Office’s SME Panel.

Outsourcery has raised the funds needed to develop its infrastructure to the point where it can bid for these juicy government contracts, but the rapid expansion is arguably a tight stretch and a ballsy move. Does he feel like this is pushing his limits?

“That’s what entrepreneurs do, isn’t it?” Linney is careful to explain how this opportunity has been a long time coming for Outsourcery, which made a deliberate strategic choice based on the faith that cloud was the future. So this is not just a dare: “We’re way ahead of the game because we took this quite large financial risk four years ago.”

Speaking of personal limits, there’s the fact that Outsourcery represents all of Linney’s interests: the internet as the next big thing, the world of business, and the opportunity inherent in the fact that if companies continue to consume computer power the way they are now, the cloud will be the only place with enough room to store it all. “Not only that, but the underlying technology, so silicon chips, that has to change too – to a faster, more lightweight, more resource-intensive way of providing computing power and storage. Otherwise we’re going to run into a wall very hard. The cloud is just a step in that direction.”

Vision, risk, pain, business
Linney’s faith in the internet and cloud as a serious business tool was part of the reason he left investment banking 14 years ago. “It was a different time then,” he says, referring to the dot-com mania: “When I left Credit Suisse in 2000, I raised £700,000 while leaving the building, to do an internet start-up. Those days have long, long gone.” Still, there are probably more talented entrepreneurs in the UK now than back then, many of who will start their careers in a corporate environment before heading out on their own. Like Linney: he studied law at university before qualifying as a solicitor, “as that’s what you did”. Keen to do something more business-related, he soon moved into investment banking: “I loved working in the City. So I had legal and financial experience, and I used that to put a business plan together and raise money. Those are very, very useful skills. When the internet came along I saw an opportunity to step out of what was by then a quite well-paid job, and go and do what I really wanted to do.”

Not that Linney always knew exactly what he wanted to do. He never planned out his route, although an entrepreneurial drive has been apparent since he started his first business venture at age 13: “My core skill set is very much investment, structuring, corporate finance.” So is that what motivates him? “No, that’s just what you need to do to get your business going.”

So what does motivate him? Linney thinks for a bit. “I need to answer that carefully. It’s building something …” He laughs: “Well, as entrepreneurs, you want to prove you were right! So you will say, I had a vision, I’ve delivered it, I’ve executed it, I’ve created value. You have many sleepless nights, you know it takes something out of you to build a business. It’s personally quite painful, quite risky.” Then, hopefully, he’ll be able to do what he wants: support his family, his friends, make sure his daughters are supported. “And then, when you’ve filled your glass and it starts to overflow, then what I’m interested in is building social businesses that can actually scale.”

This is where Workinsight.org comes in, clearly a passion project judging from Linney’s enthusiasm when he’s talking about it. It’s partially about helping young people figuring out what they want to do with their lives, and making work experience available to those who lack the right connections. But it’s also about creating an infrastructure for passing on this knowledge in an efficient, scalable manner: “I’ve got lots of big company names signed up. What we’re doing right now is a pilot as we get the process right. It will be a mobile phone app, basically. It links to Outsourcery too because it’s cloud, it’s digitising a process, it’s automating it so you can scale it.”

Work-life merger
On top of everything else, Linney is raising a young family with wife Tara: their daughters Tiger and Electra are three and six. He’s not too keen on sharing details about his personal life, but he will talk at length about how much he loves daredevil-style mountain biking, and he recently got a skipper licence too. Just don’t expect any breezy days on the Thames: “Oh no, it’s a very fast boat. It’s a power boat, it’s huge!” He laughs. “But most of the time I’m working. That’s the challenge of being an entrepreneur: finding time, and finding the balance between the pressures of building a business and having a young family. And then to actually do the things you love doing as well.”

Whether sitting in the hotseat on Dragons’ Den is work or play is unclear, but I’m starting to suspect that Linney doesn’t really separate between the two. “My hope is that I attract more technology entrepreneurs, because historically, Dragons’ Den hasn’t seen a lot of tech opportunities. […] Most economies and empires are built by entrepreneurs. But once you get past your family and friends funding, maybe a small venture capital round, if you want to get big you need to raise three, four, five million. That, in this country, is quite a tricky spot.”

Still, Linney seems to enjoy being on the smaller end of the spectrum, readily admitting he’d probably step aside rather than run Outsourcery as a FTSE100 company. “When you get to that level you’re dealing more in governance, and I’m an entrepreneur. When it gets to that scale, I don’t think I would be running the business. I’ll be building the next one. […] I’ve sat at every side of the table: I’ve been an advisor, I’ve been an investor, I’ve done leveraged buy-outs, hedge funds, started companies, turned companies around, bought, sold, merged. So there’s not much there that fazes me.” And he’s still only 43: “I’m older than I look.” He laughs. “I’ve got moisturiser!”

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The wealth management sector and the pension rule change payday

Square Mile Magazine, 2014. Original article (p84-85).

SM92 wm pensionsThe wealth management sector and the pension rule change payday
Who will look after the baby boomers’ pensions? Now that the Chancellor has rewritten the book on retirement funding, wealth managers are eyeing a rare opportunity to take a sizable chunk of this market.

£12 billion was spent on annuities last year, as regulation meant the guaranteed income scheme was mandatory for many pensioners. As this will no longer be the case, insurers are licking their wounds as the annuity market is expected to fall by two-thirds over the next 18 months, according to Barclays Equity Research, or possibly even become extinct altogether.

“This is a huge change, and the effects on the wealth management industry will be very positive,” says Tom Hawkins, Head of UK Proposition Marketing at Old Mutual Wealth. “Now that the barriers have been removed, there will be a significant rise in the demand for individual advice.”

The effect won’t be immediate for the wealth management sector, as the pension changes won’t come into effect until next April. But reports from leading providers have suggested annuity sales have halved since the news, as people are delaying purchases to review their options in light of the new situation. Bank of America Merrill Lynch estimates the opportunity could be worth £6 billion for the wealth management industry, and this is at the conservative end of the spectrum.

As wealth managers are exploring how to best respond to this opportunity, Hawkins believes we can expect to see innovation in both products and packaging, as providers will be looking at their offerings with fresh eyes. “People may take an added interest in their pensions now that there’s this added motivation [of more choice]. There’s an opportunity to make pensions simple and engaging,” says Hawkins, stressing there will be a strong need to provide proper guidance.

Because the freedom to build our own pensions also comes with hefty dose of risk. “We will see more awareness around how to structure income in retirement,” says Ian Price, Divisional Director of Pensions at St. James’s Place Wealth Management. “But annuities will still remain relevant for many people, because the one thing no one knows is how long they are going to live.” While critics point to annuities becoming increasingly more expensive, they do shift the risk of longevity and investment value fluctuations onto the provider – a feature which will undeniably remain attractive for many pensioners.

Describing the new pension rules as a big surprise to the industry, Price is also optimistic that the new rules will lead to more awareness around retirement funding: “This could increase people’s faith in pensions, and encourage them to think more about their options.” The fact that people are less likely to go straight from full-time work to retirement anymore is also changing the financial needs of pensioners:

“I think building portfolios of assets to live off will become more common,” says Price, adding that this doesn’t have to be just shares and funds, but also ISAs and elements like buy-to-let properties. “People will have more than one income stream to live off in retirement.”

This has already started to happen: only 27% of professionals plan to rely on just on a pension for retirement income, according to a survey by Wesleyan Assurance Society released in May. While two-thirds of respondents admitted to be in the dark about how much their current pension arrangements are worth, over half said they plan to use property to generate additional funds.

Asked whether the new retirement flexibilities will be primarily of benefit to wealthy pensioners, Hawkins said the changes could be positive for anyone preparing to retire because it will encourage more people to seek financial advice. “The more affluent investors will often have financial advisers already, so they will have been aware of their options regardless. The opportunity is now for those with the average pension pot, which is £40,000, to become more aware of the available choices.”

While welcoming the relaxation of rules guarding the extraction of funds from pensions, David Stoll, Board Partner at Partners Wealth Management, is skeptical of the prospect that this represents a major change for industry: “In practice there will probably be little change in behaviour at the upper end of the market, where larger pension portfolios are already managed pre and post retirement without having the requirement to purchase an annuity, as has been the case for a number of years.”

Stoll also points to other factors, particularly in regards to tax, which will effectively restrict choice: “The new regime will not necessarily provide as much flexibility for all as heralded, and individual bespoke advice will remain as important as ever”.

Making sure people properly understand the risks, especially if they choose to take their money as a cash lump sum, will remain a key task for the wealth management industry. Concludes Hawkins: “The wealth management firms who will be successful under the new rules will be those who provide quality advice and flexible options.”


The technology opportunity

Square Mile Magazine, 2014. Original article (p86).

Screen Shot 2014-07-13 at 14.13.38The technology opportunity for wealth managers
We like a good app: it’s such a quick and easy way to access information at any hour. These are features not too often associated with traditional wealth management, but this is changing rapidly as the industry is embracing technology.

Keen to woo the next generation of customers, wealth management companies are taking to apps, Twitter, Facebook and LinkedIn with gusto – some and even use photo sharing site Flickr. As people are getting accustomed to quick and intuitive technology in other areas of life, they see no reason why their wealth manager should require a phone call when an app could do the job, or even an office visit if a video link would do the trick.

“We’re moving away from a time when investment firms would act as gatekeepers to information. Instead we are sharing the information with our customers, making it easier for them to make their own investment decisions,” says Danny Cox, Head of Financial Planning at Hargreaves Lansdown. The company’s apps for smartphones and tablets let users manage their investments at any time of the day or night, and keep up with live prices and new research. On Twitter, @HLInvest handles customer queries in addition to delivering news.

“What clients want is exceptional service. They want technology that enables this great service,” says Cox when asked what features customers are looking for. The key to making technology work for wealth management groups, and not just be “nice to have”, is to make it an intuitive and interactive tool for communication. Today, over half of Hargreaves Lansdown’s new business comes through digital channels, with around a quarter of website visits coming from smartphones.

Wealth managers who meet the demand for easy access may find themselves not just more attractive to tech-savvy new clients, but also receiving more business from existing clients. If wealth managers of the past used to sit down with clients once or twice a year, granting better access today means more informed clients reaching out for more frequent consultations and trades.

“All wealth managers have seen increasing demand from clients for greater visibility on their investments, which is correct. But technology has created an interesting situation, as relatively small retail investors now have access to state-of-the-art investment reporting systems, creating pressure further up the wealth scale for wealth managers,” says Paul Fletcher, Head of Marketing at London & Capital. And this may not always be ideal: “Greater visibility could lead to more indiscriminate wealth manager selection by clients, which is at odds to most of the ‘buy and hold’ investment strategies larger clients tend to adopt.“

Still, 24-hour access and the accompanying transparency is rapidly becoming the norm, and the winners will be the wealth managers who embrace the new tools, says Amit Pau, Director at technology-focused investment and advisory group Ariadne Capital:

“[Wealth management] is an industry steeped in tradition, and the future winners will be those that embrace digital to address the rapid needs of evolving customer needs. Digital, as an integral part of the wealth management, will be a strategic differentiator by driving innovation, improving efficiency, enhancing communication, and prioritised customer convenience.”

This conclusion is supported by research from asset managers SEI, NPG, and Scorpio Partnership. Released this spring, the study found that 92% of wealthy investors are making extensive use of digital tools ahead of transactions. But when large sums are at stake, most clients still view the manager as the lynchpin:

“The research emphasises the importance of a personal delivery in the wealth management transaction,” said Marc Stevens, CEO of NPG Wealth Management. “But it also highlights that for customers to be truly satisfied, their human contact at a firm must be supported by digital capabilities.” Almost 70% of wealth management clients under 40 look at their accounts at least once a month, the research found, while nearly 45% of those over 60 do the same.

Transparency is the guiding principle at Nutmeg, the UK’s first online-only investment company. Granting customers complete access to their accounts is only one feature of this, another being the fact that the company publishes its net performance figures. Nutmeg’s technology-driven business model makes it a different animal than its sales-driven competitors, a fact which CEO and co-founder Nick Hungerford attributes as an enabler of the company’s competitive pricing.

Nutmeg’s do-it-yourself approach, and arguably radical openness, means the company is frequently hailed as an innovator. But Hungerford resists the notion that dedication to communication and convenience should be considered ground-breaking: “All companies in the wealth management sector should be operating in this way. If they were, it would drive healthy competition, transparency of service and, most importantly, better customer experience.”


The most powerful man in the City

Square Mile Magazine, April 2013. Original article (p77).

Screen Shot 2014-02-21 at 19.02.04The 100 most powerful people in the City
Number 1: The Governor
He is at the heart of the City of London, but as Sir Mervyn King prepares to bow out after a decade as the head of the Bank of England, it is a much bigger picture that dominates the Governor’s mind. As the June handover date for Mark Carney’s tenure approaches, King’s tone has grown increasingly frank and critical over the past few months. King is keen on decisive action, arguing that Royal Bank of Scotland should be broken up into a “good” and “bad” bank. In part this would ring-fence high-street banking from more speculative operations and deal with the ‘too big to fail’ problem once and for all, but it would also put RBS in fighting form to support economic recovery. King argued for this move also when the economic crisis first hit in 2008, but time has demonstrated the extent of the mess, and that the clean-up will take a lot longer than anyone likes to hear.

This newfound boldness could be read as a desire to secure a legacy as a reformer, or maybe a streak of fearlessness has set upon the economist as he eyes up retirement. The Bank of England was stripped of its regulatory powers in 1997, and hence could do little but scorn and tut as the crisis approached; still, King has admitted the Bank of England could have done more to warn about the impending economic collapse. Said King last year in a BBC Today Programme Lecture: “We should have shouted from the rooftops that a system had been built in which banks were too important to fail, that banks had grown too quickly and borrowed too much, and that so-called ‘light-touch’ regulation hadn’t prevented any of this.”

It may be a desire to make good on this perceived mistake that encourages King to push for prudence as the global ‘Basel III’ standards are being fleshed out, claiming it is not enough for banks to hold quality capital of at least 3% of their total. In the same spirit, King is in no mood to listen to bankers who want to keep more of their bonuses by delaying payment until tax rates fall from 50p to 45p. Stressed King when discussing the matter with the Commons Treasury Committee: “In the long run, financial institutions … do depend on goodwill from the rest of society.” Bankers may call it good tax planning, but this is one insult too far in a time of bail-outs, spending cuts and rate-fixing scandals, at least in King’s big picture.

Hailed as an inspired choice from a new generation of central bankers, Mark Carney will pack up as head of the Bank of Canada and move to London in June. King (64), born in Chesham Bois and educated at Cambridge, can look back at a career as an economist, lecturer and public servant at the Bank of England; his successor, however, hails from a banking background, with 13 years with Goldman Sachs before joining the Bank of Canada. Carney (48), born in Canada’s Northwest Territories and educated at Harvard and Oxford, has pledged his leadership to be one of transparency and accountability when he takes over the big seat at Threadneedle. While having expressed admiration for the Bank’s handling of the financial crisis, Carney’s stance does however differ from that of King as he believes central banks have yet to exhaust their arsenal to boost economic growth. Even if it means inflation stays higher, Carney told the World Economic Forum in Davos in January that monetary policy should continue to be utilised until economies achieved “escape velocity”.

Carney’s so-called radical solutions have been hailed as partly the reason Canada came through the recession in decent nick, and Carney has hinted he will be bringing his more unconventional thinking to Britain. As chairman of the Financial Stability Board, the global financial watchdog, Carney has previously pushed for stricter rules for capital and liquidity, but exactly how hard he will push the British banking sector is anyone’s guess. One challenge for Carney will be to negotiate with the Monetary Policy Committee over interest rates; in stark contrast to Britain, Canadian MPC members tend not to publicly disagree with their leader. New laws will give the Bank new authority over financial regulation, meaning that by the time Carney steps in, no other head of a major central bank will have more power.

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Generation Tech

Cover story for Square Mile Magazine, December 2013. Original article here (p75-79).

SMGeneration Tech:
Interview with James Gill, co-founder and CEO of GoSquared

Prufrock Coffee is buzzing even though the lunch rush has come and gone, as James Gill isn’t the only startup CEO who likes hauling up in the airy Clerkenwell cafe to talk shop. While we wait for our caffeine, new business ideas are being doodled on napkins all around us, and Gill declares proudly that GoSquared has just had its best month yet. In jeans and boating shoes, his graphic print t-shirt seem fitting for a 22-year-old CEO, but Gill has actually had plenty of time to get his bearings – GoSquared, the real-time web analytics company, was founded by Gill and two friends when they were just 15 years old.

“I have definitely had my 10,000 hours doing design,” says Gill, peering up on the wall to the sign that reads ‘10,000 hours’, a reference to the idea that mastery only comes after having spent that long practicing. “That’s what started us on the route to GoSquared. If you go back to the beginning I would spend ages drawing things, and that evolved into drawing interfaces and designing websites.” When he was 14, Gill inherited an old Mac from his father’s office, and started playing around with Photoshop. “I picked up this magazine which was a basic intro to Photoshop, Flash and all the tools you needed to build a website at the time. I would spend all my time outside of school learning how to design things. When I met Geoff [Wagstaff] and JT [James Taylor] they were much in the same way, but on the programming side.” As the trio started making websites they learned as they went along, first designing features and then working out how to get them to do what they wanted. “Before we started GoSquared we knew almost nothing, so it was all about spending hours and hours working things out. It’s definitely taken more than 10,000 hours.”

GoSquared originally started out selling advertising squares (hence the name), with analytics being a sideline that quickly became the main offering. Unlike the main competitors, GoSquared delivers web analytics in real time, enabling companies to respond immediately to problems or opportunities. While CEO Gill’s job has long-since developed past the original remit, good design remains at the heart of the GoSquared philosophy: “Designing the product isn’t just about making it look pretty. It’s about which features really matter, getting rid of the things that don’t, and making sure we design something that not just looks great but also works great.”

Competing with the “hellishly complex” Google Analytics, and Adobe Omniture, Gill credits better design as a key reason GoSquared has been able to gain a foothold in the analytics space. Being young and nimble helps too: “By having a relatively tiny team who know what they want to do, we can be much more unified in everything we make. … Maybe a time will come when we have to expand, but right now we love it because we don’t need to have too much structure or too much process. People get to stay more autonomous.”

A lot has changed for Gill and GoSquared over the past two years, though. While they started the company while still in school, the trio was well on their way to university when Passion Capital co-founder Eileen Burbidge came after them with an offer of funding. Gill dropped out of university after five weeks to give the company a proper go.

“It was very much about the three of them as a co-founding team, says Burbidge when asked why she pursued GoSquared. “Given their age, and the fact that their business had already been trading for five years at that point, it was obvious they were ambitious, proactive and able to secure clients and generate revenue.” Their instinct for design and user experience was “extremely impressive”, says Burbidge, and integral to how they approach software development.

GoSquared has since raised more money from Passion Capital and Atlas Ventures, but Gill admits it’s been a challenge: “Everyone dreams of having their investment in the bank, but once you do, you have the pressure to grow much faster than you were previously. Not just with the users you sign up and the revenues you make, but also in terms of building the right team. We were really caught off guard as to how difficult it would be to build a team: to find the right people, to bring them up to speed, to get them working to your vision and to keep them happy and excited every day. We are still learning how to do that.” This CEO gig is, after all, Gill’s first job, unless you count some work experience at Oxfam: “Yes, I’ve never even had a boss!”

“It still amazes me that we have thousands of people using these tools we have been building. That is an amazing feeling.” Gill pauses. “I used to think, do I want to be an artist or do I want to be a designer? With art, people look at what you create and admire it, but with design they rely on it to get their jobs done. … I still love coming home and saying that we have created something.”

While analytics has traditionally been a somewhat dry topic for back-office staff, Gill believes this is the sort of information that will be driving businesses in the future. “We are approaching analytics from the point of view that everyone should have this data, and we want to deliver it in the easiest way possible to understand.” Eventually, this will mean providing not just raw data, but fully drawn conclusions for action: “This is a massive challenge and a heck of an opportunity for us. The analytics market is still in its infancy.”

A Londoner at heart, Gill is proud to be building GoSquared in the capital: “The London startup scene is getting more and more exciting, with so much having changed just over the past few years.” Born in Blackheath before his family moved to Kent, he now lives in the city with his girlfriend. While not blind to the allure of Silicon Valley, he has no plans of moving: “Maybe I’m naive, but I still like the idea of building a company in London that can compete with companies over there. We have so many talented people in our team and we have great investors, so I don’t see why we can’t keep growing as a company from London. And to show those Valley guys us Londoners can compete!” While Gill admits the London scene has its share of people who “spend all their time at startup events and don’t really do much else”, there’s also a lot of talent: “There’s a heck of a lot of smart engineers and developers on the scene. The main challenge is probably bringing them together and forming teams that can achieve something.”

With over 30,000 websites now using GoSquared analytics, is Gill scared of failing? He hesitates, but only for a second: “I don’t really think about it. For me there isn’t really an option but to make this work. I’ve sunk seven years of my life into this!“ To be fair, the worst case scenario for GoSquared at this point is probably a buyout, offers for which are frequent, confirms Gill: “But we really don’t want to get bought out!”

While Gill is doing “everything I physically can” to push GoSquared, there’s time for other things too, just about. For most things there’s an app: “I have my Nike+ running app. The YPlan app is great, they’re a London startup that help you find events.” He pulls out his iPhone and shows it to me, along with another couple of apps whose design he admires. Gill is a regular at the rugby to support the Harlequins, and frequently goes back to Kent to see his “amazingly supportive” parents. Before I’ve even asked he tells me about his girlfriend Emma, who has just started working for another London startup. He loves the London food scene, especially places like ‘Dirty Burger’ where they do just the one burger but what a burger it is – a well-designed concept.

But as most people who truly love their job, Gill never really stops working: “I don’t really have that switch between work and home. On the average day I get up, have a shower, get the Tube and then I spend some time alone in a coffee shop before I go into the office. I’m often there until 8pm, but even after that there’s always someone to reply to, something to sort out for tomorrow. There’s always so much going around in your head.” He seems happy though, excited to be in the hotseat, even though as he says, the startup life swings wildly between highs and lows. Is he saving the sports cars and parachute jumps for his mid-life crisis? “Mid-life? Do I have to wait that long?” Gill laughs. “Maybe someday. But for now I get plenty of adrenaline just going to the office.”






Roundabout Royalty

Jude Ower, Playmob
Gaming, business and charity comes together at Playmob, the company founded by CEO Jude Ower in 2007. The company, whose technology enables charity elements to be added to existing gaming features, lets charities get a cut from in-game purchases. The games developers benefit too, as the charity link makes players spend more. Working closely with product director Caroline Howes, Ower comes from a background in consultancy and marketing. Now based in Fitzrovia, Playmob has raised more than $1 million to date, from the likes of Nesta, Midven, individual angels and startup accelerator Springboard.

Joshua March, Conversocial
Conversocial helps businesses keep track of customer services issues raised on social media, so they can respond right away to snarky Facebook posts and bitchy Tweets. By efficiently keeping up with the social web in real time, companies can provide great service and better manage their reputations. CEO Joshua March co-founded Conversocial alongside COO Dan Lester in 2009. A year earlier the duo had founded app-development agency iPlatform, which was acquired by Betapond in 2012. Shoreditch-based Conversocial has raised $7 million in funding, and last year opened a New York office.

Julia Fowler, Editd
Frustrated with the lack of provable information to predict trends in the world of fashion, designer Julia Fowler came up with the idea for Editd. The company mines and examines data to help the fashion industry measure trends and the market. Co-founder and CEO Geoff Watts brought the data processing expertise to Editd, and now aims to make the company the definite real-time resource for the industry. Established in 2009, Editd has the support of startup incubator Seedcamp, and later raised $1.6 million in a funding round led by Index Ventures.

Damian Kimmelman, DueDil
DueDil is making waves with its database of information on private companies in the UK and across Europe, letting subscribers access 20 years of financial and corporate information on private companies. CEO Damian Kimmelman founded the company in 2010, having previously founded two companies: a London-based digital agency in 2007, and a Chinese peer-to-peer online gaming platform in 2005. DueDil wants its services to lower the barrier to entry for entrepreneurs and developers, enabling them to integrate data directly into their applications as well as building new services.

Hannah Wong, Foodity
Foodity turns recipes into shopping lists, transferring ingredients for new dishes to online supermarket shopping baskets. Working with major brands and retailers to streamline cooking and shopping, Foodity also makes suggestions to users based on what’s most popular, affordable or best quality. Having raised £450,000 to date, the Waterloo-based company is currently in the process of raising an expected £2.5 million in new funds. Operations lead Hannah Wong is the impetus behind the company, having co-founded Foodity in 2009 in the hope of helping people make better eating decisions. She previously set up meal-planning website ‘The Resourceful Cook’.

The other mayor

Published in Square Mile Magazine, April 2013. Original article here (p78-80).

Roger GiffordInterview with the Lord Mayor of the City of London, Roger Gifford
If the Lord Mayor is the spirit of the City, as Roger Gifford suggests, it is tempting to wonder how his particular brand of banking could stir things up in the City. As the first banker elected Lord Mayor of the City of London since the financial crisis, Roger Gifford lends credence to his motto of ‘City in Society’ by having kept loyal to the same bank for over three decades, without ever needing bonuses to keep him interested:

“Financial services is a means to an end, not an end in itself. They are means to serving society,” says Gifford, now on leave from his position as UK head for Sweden’s SEB. “You could say this is a reaction to five years of difficult times in the City, but for me it is much more a belief. You could say it is a little bit Swedish, actually.”

There is nothing Scandinavian about our surroundings though, as we meet in the Lord Mayor’s office in the Mansion House. The building was indeed designed “to amaze and impress”, confirms Gifford, who can call the grandiose building his home during his year in this unpaid position. An intense schedule of meetings, dinners, travel, receptions and up to four speeches every day means there is much demand for Gifford’s time: “You have to like the sound of your own voice to do this job, to be perfectly honest,” he laughs. We are careful not to spill our teas on the brocade, as Gifford, classically dressed in a deep blue suit and subtle-patterned tie, admits he sometimes nips off to his North London family home so he can put his feet up without fear of ruining a piece of national heritage. “But it is so exciting to be part of such a long tradition. And yet, to be doing it in a very modern world. It is that combination,” says Gifford.

While the Lord Mayor’s mandate is industry-wide, his banking background means Gifford naturally drifts more towards the City’s financial issues. While debates on regulation, as was the topic of Gifford’s breakfast meeting, is high on the agenda, this is however only part of the Lord Mayor’s concern. “The public has, and I think rightly, been confused and disappointed by what they have heard about the banking industry,” says Gifford, pointing specifically to the bank bail-outs, “But we have not been good enough at explaining what banking is all about. For instance, there are 250 foreign banks employing 150,000 people in the UK. That is a massive bit of business has no burden on the UK tax payer at all.”

While issues such as the Libor scandal has done little to reassure the public the problems are in the past, new regulation has already changed UK banking, says Gifford. But did the industry want change?

“Yes, I think they did.” Gifford pauses a moment. “As a banker, I have been really upset about some aspects of the industry. […] There are aspects around remuneration which I have not liked as an employer, and I am delighted they are changing.” But, notes Gifford, there is a tendency to blame procedures following a crisis, while a big part of the issue has been caused by socio-political trends of consumer over-borrowing: “You cannot really legislate for that, but people are changing regulations because of it. We have said in the City all along: we want the right regulation, not more regulation.”

Having been responsible for SEB’s UK operations for 12 years, the Scandinavian point of view has affected Gifford’s outlook on the current situation. The Swedish banking sector underwent a crisis during its deregulation 20 years ago, which means SEB now has a “more cautious, more conservative” attitude than many UK and European banks: “We have, like the Norwegian and Canadian and Australian banks, a very conservative policy on credit. We are very careful where, how much and how long we lend for. We are very careful about the derivative structured products, and we do very little of it. I have been very affected by working for a Swedish bank for 30 years.”

Gifford has previously stated how the Occupy movement sparked important discussions about what we want capitalism to be. He calls for an increased social awareness in capitalism: “We all prosper more if all parts of society are looked after. You can talk about benefit fraud, excessive social policy or taking away the will to work, but there have to be balances,” says Gifford, who credits Occupy with having made people stop and think. When asked whether this feels like a radical attitude, Gifford counters that it in fact feels very normal. But, I point out, we are sitting in this lavish building, after he as the Lord Mayor was sworn in during a silent ceremony with elaborate costumes and processions. Does the pomp and circumstance add something, or is it a distraction?

“The ceremony side of things is great fun. It is no more than 2% of the total amount of time,” asserts Gifford. “And it adds because it reminds people of the history and tradition that has developed over 800 years. There are reasons why we live the way we do, why we have the kind of government, the kind of Monarchy and the City institutions that we do. We have them because of history and they remind us of our principles, of behaviour, of activity, the direction we are going in, and they remind us that we should live for the long-term.”

There is no doubt Gifford feels is a great honour to be Lord Mayor, but, I press, does the role actually come with power? Gifford thinks for a moment. “I do not feel I have much power, but I maybe have a little bit of influence.” He pauses again. “The Lord Mayor is a representative of the City. He is the spokesman. The position is revered a bit, and that gives you responsibility to think, to behave, to discuss in a certain way. I do not think it is against the sort of person I am, but you feel the responsibility to try to influence in the right way.”

The charities, trusts and clubs where Gifford holds mandates of influence, many of which come with the job, also cross over into his personal interests: “I am really interested in what the City does on the music side. Certainly, I get very involved with the English Chamber Orchestra, the Tenebrae Choir and St Paul’s Cathedral Foundation. […] I am very interested in the power of music to change and affect people,” asserts Gifford, not to mention how these classical organisations nurture a need for tradition: “People want to belong.”

The Lord Mayor certainly knows where he belongs, having said at the beginning of our meeting he would go back to SEB after this year: “I have been 30 years with dear old SEB. I will go back to them.” But after the Mansion House experience, will his role there be enough? “I only said I would go back to SEB. I would quite like to do something a little bit else!” Gifford says, with a glint in his eye.

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