This article discusses:
- Changes in the financial markets
- Transiting from an investment bank to FinTech
- Similarities between the 2008 credit crunch and the current market
Reinventing yourself and your career can be challenging, especially in a sector known to evolve quickly. I have been in FinTech recruitment for over 20 years and have witnessed a great deal of change, particularly within the financial markets themselves.
What changes have you witnessed?
The key development that resulted in a massive shift in the financial markets was the rise of financial technology and electronic trading. Back in 2004-2008, the highest-paid individuals were those that worked at investment banks, typically in sales and trading roles where the derivatives market was the real money-maker.
The 2008 credit crunch which saw Lehman Brothers along with other firms declared bankrupt, created a domino effect. There was a strong feeling amongst candidates that the markets were never going to stabilise or improve, but as with everything, eventually, the tide turned.
As the markets improved there was a strong push from people who wanted to move out of traditional finance and investment banking jobs into technology and FinTech. Not only has FinTech as a sector escalated in size, but as a result of the rise in technology, there has been a reduction in the amount of manual intervention needed in investment banks and traditional finance jobs. This has led to multiple individuals being made redundant who now need to evolve and reinvent themselves which can be a difficult transition.
How would someone in a sales role transition from an investment bank into FinTech?
Firstly, it is very important that you can demonstrate the actions you have taken to try and break into FinTech. FinTech as an industry has grown immensely in popularity and there are numerous individuals interested in transitioning, so it’s important to set yourself apart.
In my opinion, saying that you want to transition into FinTech and taking the steps to do so are different, and what separates the former from the latter are those that invest their time into learning. There are many courses available that will provide you with a qualification. A popular programme offered by the University of Oxford is the Oxford FinTech Programme. By obtaining a qualification like this, you are proving to a potential employer that you are proactive and motivated.
In my experience, those that have gained a qualification or actively immersed themselves in new technologies by reading relevant literature are more likely to be offered a job in the FinTech space.
I’d advise you to follow senior leaders within the industry you’re trying to break into on LinkedIn. Pay attention to what they are posting and talking about, this will help you keep up to date with trends in the FinTech space.
Are there any similarities between the Credit Crunch in 2008 and what's happening now in the market?
Markets are cyclical, there will always be ups and downs. In my opinion, what’s happening in the current market is not as dramatic as it was in 2008. We are experiencing some challenges in the digital asset and cryptocurrency sector, in part because of the FTX scandal and only those firms that are well-financed are still actively growing. However, there are other niche areas within digital assets and cryptocurrency that remain unaffected. For example, businesses that focus on similar blockchain technology but for other purposes.
We are also seeing numerous technology layoffs and some of the big banks such as Goldman Sachs have let a lot of people go. I would advise those affected to take some time out and re-evaluate the path they want to take. As hard as it seems, don’t get too downhearted by the situation, assess what you want to do next. Look back at your past role and assess what you’ve enjoyed, and the relationships you’ve made, whether that’s client relationships or internal ones. Utilise your relationships, skills, and experiences as you will likely be able to apply them to a different industry or sector.
If you are looking at transiting into FinTech and want additional advice, please reach out to Rich Lesser at richardlesser@staging.ec1partners.com. You can view a full list of our live roles here.
Faqs
Over the past two decades, the financial markets have experienced significant transformations beyond the rise of financial technology and electronic trading. For instance, there has been a shift towards algorithmic trading, the proliferation of robo-advisors, and the emergence of blockchain technology. Additionally, regulatory changes such as MiFID II and GDPR have impacted how financial firms operate and manage data. These changes have reshaped career trajectories by creating new opportunities in regulatory technology (RegTech), cybersecurity, and data analytics.
Practical steps include networking with industry professionals to gain insights and connections, gaining hands-on experience through internships or freelance projects, and developing a solid understanding of technology and digital innovation. Additionally, showcasing transferable skills such as adaptability, problem-solving, and resilience can enhance competitiveness in the FinTech job market.
In the current market, challenges in the digital asset and cryptocurrency sector have been exacerbated by incidents like the FTX scandal. However, niche areas within digital assets and blockchain technology remain resilient. For professionals affected by technology layoffs, leveraging their skills, experiences, and relationships to explore opportunities in other industries or sectors is essential. This may involve re-evaluating career goals, acquiring new skills through training or education, and seeking guidance from industry experts or mentors.
