This article is from the annual FinTech Forward special report.
What does an analysis of the FinTech Forward class of 2014 the top tech companies serving this industry tell us?
For one thing, it gives us a glimpse into the solutions that are gaining ground. The FinTech Forward 100 companies that grew the fastest in 2013 are a reflection of the continued investment being made in risk management and regulatory compliance. Companies such as SmartStream, Moody's Analytics, and Nice Actimize are three of those fast-growing firms.
Another observation from looking at the fastest growing fintech companies is that 9 of the top 15 fastest growers are located outside the U.S. From Switzerland to China to India we see local fintech providers offering regional solutions to meet specific regulatory or cultural requirements.
If we look at segments that performed less well in 2013, we see firms like Black Knight Financial Services and CoreLogic that are still suffering from low demand for mortgages and the solutions that support that product.
Only a few large acquisitions resulted in familiar names leaving the rankings. Digital Insight and Harland were both acquired by larger fintech providers. Digital Insight was brought into the NCR fold to fill out its channel offerings with digital and mobile. D+H picked up Harland Financial for its loyal base of community bank customers and its more innovative solutions.
The top providers in the Enterprise 25 rankings had a difficult year in terms of revenue. Across the board these firms struggled to find organic growth in 2013. In addition to a slow economic environment, the technology industry is shifting from license to subscription revenue causing disruption in revenue flows and recognition. With this transition and the focus on big data, providers such as EMC and Cisco are succeeding. Vendors and end users must invest in data storage and networking to prepare for more cloud-based offerings and pure infrastructure players are reaping the benefits.
At the other end of the spectrum from our Enterprise 25 are our Companies to Watch. As we reviewed the varied group of nominations we received for our Companies to Watch we were looking for a few things.
First, as always, we looked for innovative ideas and approaches. We looked for fintech providers who have won some clients and/or partnerships in our industry. There are lots of new entrants with big ideas, but a much shorter list of new entrants who have successfully sold and implemented their solutions.
We also looked for firms offering solutions that can solve today's problems. Our research showed that there are five key areas of investment right now: mobile, branch transformation, big data and analytics, security and fraud, and process improvement and workflow.
With this group of companies to watch, we are providing tech buyers with some new providers and new solutions to current problems. These are firms that already have financial institution clients and that are aligned with our five key investment areas. Our panel of experts cast a wide net to find these new companies and then winnow down the list to include only those firms that we think are ready to serve you now.
Jeanne Capachin is the founder and principal of Capachin Research in Norfolk, Mass., and oversaw research and data analysis for the FinTech Forward project.