Fintech
3 questions with… Akash Shah, BNY
This content first appeared in the June 2024 Fintech Newsletter. If you would like more commentary and analysis on news and trends from the a16z Fintech team, you can subscribe Here.
Founded in 1784, BNY — formerly known as BNY Mellon – is the country’s oldest bank and is no stranger to change. But according to Akash Shah, the banking and financial services provider’s chief growth officer and global head of growth ventures, the company is currently undergoing a particularly rapid shift in how it aims to realize the full potential of its capabilities, scale and people – and it’s fueled by progress.
“What excites me most is that the combination of our ambition and the rapid growth of capital markets – new individual investors, new asset classes, new markets entering the global economy – are great short- and long-term catalysts for our growth,” he says.
BNY, which held over $47 trillion in assets under custody and/or administration, as well as $2 trillion in assets under management starting from 2023, welcomed Shah in 2018 as chief strategy officer. He currently focuses on innovating new product offerings for clients and managing BNY’s software and data management operations, among other duties.
“Large software companies should be providing investment solutions in virtually every client interaction, and the large investment managers of the future will need software to structure, deploy and manage their assets,” he says. “This is what we are today, and what we want to be even more in the future.”
We recently asked Shah about BNY’s approach to adopting AI, the challenges ahead, and what advice he would give to fintech startup founders.
Below is an edited excerpt of our conversation.
a16z: How is BNY adopting AI and where has it had the biggest impact so far?
Akash Shah: AI is especially powerful when used to solve our customers’ most complex problems: those involving market structure, customer habits and technical idiosyncrasies.
Here’s a great example: Our AI model, which has been trained on more than 200 million trades and takes into account more than 15 attributes of a trade, can now predict with an accuracy rate greater than 90% the probability that the transaction is resolved by deadline, 24 hours prior to deadline, for transactions outside the United States
Ultimately, for our customers, access to data means agility, and access to real-time data means business advantage.
a16z: What is the biggest challenge facing BNY today?
Akash: From the perspective of our software and data management platform, we see a huge opportunity to meet evolving client needs and demand for an innovative capital markets data management solution.
Our challenge is to ensure we can deliver this in an environment where technology and data ecosystems are becoming increasingly complex, competitive and expensive for our customers. The way to overcome this challenge is to stay ahead of disruptive forces impacting capital markets, such as connecting disparate parts of the financial ecosystem, alleviating market complexity, and promoting digitalization and data as growth enablers. We provide our buy-side and sell-side clients with a leading data management solution designed to deliver deeper insights and actionable data that can help improve their investment performance, distribution reach and risk management.
a16z: What advice do you have for founders in the early stages of building wealth management?
Akasha: Don’t let the limitations of what your product can do also limit what you offer your customers; win by combining great software with the right investment product. And remember: if your focus is on software, you need to find partners who can bring the other part of the value proposition, and vice versa.
Put all this into a customer experience that starts with great UX and includes a level of end-to-end support that fosters trust (ultimately, you’re dealing with people’s money) and you’ll be amazed at what you can achieve.
When I meet with other founders, I like to remind them that BNY founder Alexander Hamilton was only 29 years old when he created what has become one of America’s oldest companies. They often find it really inspiring that someone can build something that has lasted for so long. I know he’s an inspiration to me.