As I first put fingers to keyboard from our offices in Massachusetts to present highlights and observations on this year's FinTech 100 and Enterprise 25, Hurricane Irene (aka Tropical Storm Irene) was bearing down on the Northeast. The news coverage was constant as meteorologists tried to pinpoint where the storm would hit and project how much damage it would cause. Most people felt they would be well prepared for the storm when it arrived, if not overprepared.
There is no weather forecast for financial services.
The global economy is at another tipping point. Economists are talking about the threat of a double-dip recession as we continue to see real volatility in the global capital markets as well as governments and banking systems struggling. And through this uncertainty and turbulence, the FinTech community will persevere.
Indeed some in our industry will even thrive. This is the eighth FinTech 100, and these leading technology providers have again increased their revenues from financial institutions, to $58.1 billion. That was up nearly 10% in a very difficult economy, versus an increase of less than one-half of 1% in 2009, to $53 billion. (The FinTech 100 posted a 10% increase in 2008 as well.)
The minimum revenue needed to make the list in 2010 dropped to $39 million, from $50 million in the previous few years. This speaks to the fact that the large vendors continue to get larger as mergers and acquisitions picked up considerably in 2010, and 2011 is on pace for a good number of acquisitions.
FIS, with its late-2009 acquisition of Metavante, claims the top position on the FinTech for 2010, with Fiserv at No. 2 for only the second year. FIS was also No. 1 in 2007, before it spun off Lender Processing Services. It will likely remain No. 1 for the foreseeable future, that is, until the next large acquisition.
In 2009, we saw only two acquisitions among the FinTech: FIS bought Metavante and Jack Henry & Associates bought Goldleaf Financial Solutions. In 2010 four FinTech 100 companies were sold: Temenos acquired the French core banking provider Viveo Group in January; Pegasystems acquired Chordiant Software (for its CRM capabilities) in April; Wolters Kluwer Financial Services bought the regulatory reporting and risk management provider FRSGlobal of Brussels in September; and Temenos struck again in October, acquiring Odyssey Financial Technologies to gain private banking and wealth management solutions.
This year we welcome 11 newcomers: Wincor Nixdorf (No. 11), CoreLogic (No. 16), Aegis Global Communications (No. 51), L&T Infotech (No. 54), ISGN Corp. (No. 68), Clear2Pay (No. 81), Scorto Corp. (No. 91), BancVue (No. 95), Multifonds (No. 96), FNC (No. 98), and Novantas (No. 100). These additions are a result of both the increased global awareness of the FinTech 100 and individual companies' achieving the financial services revenue required to secure a place on the list.
In addition to the new entrants, five companies should be noted for their steep climbs. Davis + Henderson jumped 23 spots, to No. 41; Luxoft jumped 18 spots, to No. 80; Online Resources jumped 14 spots, to No. 62; and NICE Actimize jumped 12 spots, to No. 71.
The Enterprise 25, which historically has been quite stable, changed considerably in 2010.
In January, Oracle acquired No. 12 Sun Microsystems. This made room for Teradata to join the list at No. 25. We saw the greatest movement in years on the Enterprise 25 as Deloitte & Touche Tohmatsu went from No. 23 to No. 15, and Wipro jumped four places, to No. 16. IBM and HP held on to the top spots with an expanding product lineup backed by a solid complement of financial services experts.
There are more questions than answers as we approach 2012.
Will there be a double-dip recession? What can we expect from the regulators? When will innovation return? What will serve as new sources of revenue? How can we further reduce costs and improve efficiency, while positively impacting the customer? What do we do with big data, cloud, mobile and risk management? We offer a few answers on the following pages. The rest is up to you.
