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This is Why Data Startups Are Disrupting Financial Analysis

A new generation of startups is making financial analysis easier, with open, collaborative and visually intuitive, cloud-based platforms.

A new wave of financial technology startups is making data analysis easier and more accessible to users. Seeking to disrupt the old business models of traditional financial analysis platforms, these new Web-based software startups are more open, collaborative, visually intuitive and cloud-based.

"The startup community is pretty robust right now," comments Adam Honore, founder of MarketsTech LLC, a firm that provides strategic advice and guidance to technology companies entering capital markets and other industry verticals.

Today's startups are able to use Amazon Web Services, Microsoft Edge, and Google Cloud Platform, so they can control their costs. "The barrier to entry from a cost perspective is relatively non-existent," says Honore. "That's one of the fundamental changes from the past. "Now if you have a good idea, it's $400 to test it and not $400,000," he says, adding, "No one asks you to sign requisition contracts for servers." The whole premise of a startup is zero overhead," says Honore. "With cloud computing, you're completely elastic; you consumer what you need, when you need it," he says.

"Visualization is also a key component," observes Honore, adding "That is what is really different about today versus yesterday's startups," says Honore. "The Bloomberg terminal style is yesterday," all of the new startups are Internet-based. "This is consumerization," says Honore, who notes that all of the startups have slick graphics, which is a prerequisite nowadays. One example, ChartIQ is for charting financial information. "You've got to look good on an iPad."

To save on overhead, startups can also renting office space in buildings that cater to early stage companies. For example,WeWork in New York City, rents space and provides infrastructure such as Internet WiFi, conference rooms, print copiers, and phone booths to early-stage companies. "They give you everything, the kitchen, the food and the Internet," says Lee Drogen,CEO of Estimize, builder of the first crowdsourced community for earnings estimates whose offices are in the Soho WeWork location. "You can scale up in the number of rooms you need." Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio

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IvySchmerken
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IvySchmerken,
User Rank: Author
2/24/2014 | 3:15:47 PM
re: This is Why Data Startups Are Disrupting Financial Analysis
Making life dramatically easier for institutional investors is definitely the way to attract attentions from customers. The quality and accuracy of the financial analysis is important, but without ease of use, why would anyone switch or take on a new provider? I agree that disruption doesn't mean destruction. Startups can partner with the larger financial information or software providers to gain distribution since they already have the audience.
IvySchmerken
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IvySchmerken,
User Rank: Author
2/24/2014 | 3:11:42 PM
re: This is Why Data Startups Are Disrupting Financial Analysis
I totally agree. Startups today can test their ideas with cloud-based infrastructure without incurring the cost of a fixed capital investment. This elastic model is helping startups scale up when they need to. They can develop their products, sales/marketing and distribution without allocating scant resources to servers and just keeping the lights on.
Nathan Golia
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Nathan Golia,
User Rank: Author
2/21/2014 | 3:44:09 AM
re: This is Why Data Startups Are Disrupting Financial Analysis
Yes, the cloud goes a long way in helping new entrants quickly fill the need for certain capabilities in markets. Defraying the cost of infrastructure goes a long way in making any company effective quickly.
ArielY766
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ArielY766,
User Rank: Apprentice
2/18/2014 | 2:56:03 PM
re: This is Why Data Startups Are Disrupting Financial Analysis
Excellent article on the power of cloud technology and innovation to radically change the ways that financial analysis is performed. Thetica Systems is proud to be one of those cloud based innovators, making life dramatically easier for institutional investors in ABS, CLO, RMBS and CMBS bonds.

I believe itGÇÖs also important to note that disruption doesnGÇÖt have to equal destruction. By working in partnership with leading industry providers, weGÇÖve been able to greatly enhance the experience for our mutual end users.
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