Transcript

Julia: Hello, my name is Julia Streets, and welcome to the podcast series StreetsTalksTo. In each episode, I interview leaders from some of the most influential firms, bodies and initiatives in the financial services industry. We explore what’s at the very forefront of innovation and change, and we think about the challenges facing firms and the industry at large. And in this we uncover the opportunities that exist both today and as we look ahead. Because right now, every firm, every client is looking to achieve two key things. It’s either growth and or transformation. And as a business we help them with three key offerings, campaigns, content, and coaching, because we never forget the human in the mix.

We hope you enjoy the series, which you can find on all good podcast channels. And all the episodes are listed on our website, streetsconsulting.com. You can find the episodes using the hashtag StreetsTalksTo. And thank you for listening. Welcome to StreetsTalksTo InTick.

InTick is the blocking network designed specifically for listed derivatives. It brings innovation, automation, and efficiency to traditionally opaque, highly complex and manual listed derivatives block trading processes. Currently, listed derivatives block trading is one of the last bastions of highly manual trading processes and it significantly impacts performance. Well, InTick is here to change that. They’re removing the cost of complexity and the platform unlocks untapped trading opportunities, improves performance, and enables accurate execution analysis. Now we’re going to get into how this is going to work because it’s built and delivered by experts with incredible domain expertise and a real passion for changing the industry.

Today I’m delighted to be joined by two guests. The first is the Founder and CEO James Goater, and he is joined by Co-Founder and the Chief Product and Technology Officer, or the CPTO, Sarah Timms.

James, let me first of all introduce everybody to you. James is the founder and the CEO of InTick with a wealth of experience in electronic strategic execution across traded markets. And he has led the design and the go-to market strategy for the InTick platform. Prior to that, he held a variety of senior roles at Barclays Corporate and Investment Bank, where for example, he served as Director of Prime Sales and Electronic Futures, but also senior positions at Soc Gen and also at Goldman Sachs. So James, great to have you on the show.

James: Thanks for having us. It is great to be here.

Julia: I can’t wait to get into the conversation. I’m really delighted because you’re also joined by your co-founder and CPTO, Sarah Timms. She has more than 15 years of experience working in technology companies and is an expert in building commercially viable digital products. So much so that she has trained companies as they apply technology best practice used by the leading global technology companies in order to take products to market successfully. She scaled and led product teams and B2B SaaS companies in the US and in the UK. And she previously founded and ran a US-based crowdfunding technology company, which is one of the earliest launched in the world. And if that’s not all, she was selected as one of 50 European Product Leaders and Coaches by Silicon Valley Product Group, the grandfathers of product management. So Sarah, great to have you on the show.

Sarah: Thanks for having me. Can’t wait for our chat.

Julia: Well, I say there’s so much we’re going to get into. I’ve talked a little bit about what you do and the particular market segments you operate in, but James, let me come to you first of all, I really want to get a sense of the frustration that you felt when you were at Barclays and why you’ve lent in on this challenge.

James: Yes. I tend to focus on the electronic side of the business, where there was very little or no human interaction at all. Yet on the high-touch side, where humans were involved, there was almost no automation in terms of how things got from a client’s mind into a trader’s mind and executed onto the exchange. Now, tools like this exist in every other asset class, yet for listed derivatives for a number of reasons, particularly the complexity and the nuances of all the products and the exchanges, it never came, and it seemed to me a perfect opportunity to bring this to the buy and sell side and make the trading of large trades more efficient.

Julia: Let’s just talk about the implications of not moving electronic. Because it strikes me that clearly across the board, many of the other segments or many of the other asset classes, many of the other instruments are now fully electronic. But this is an area that isn’t. What were the implications of not making that transformation?

James: Today, a lot of clients will choose, even if it’s at a slightly worse price, to trade electronically on screen. And the reason is that the benefits of electronification are well known -fewer trading risks, you can execute quickly with surety, the reconciliations are better, transactional cost analysis is better. So there are enormous benefits that come from that. However, there’s always an enormous benefit from trading blocks off-screen and negotiating because what that means is that you can get an in to tick price, which is really where our name came from – InTick n- by trading within the tick. And this is a huge advantage. So what we wanted to do, was take the execution advantage of best execution and match that with the advantages of electronic execution to create a best of both worlds situation.

Julia: Sarah, I’m going to come to you in a second because, as the other co-founder, but there is a third there as well. I just wanted to just call out different roles, responsibilities, attributes that you bring as a leadership team. So James, commercialisation really feels like a very strong sense, but also having sat on the desk. Sarah on products, I’m going to come to you in a second on that. But there’s a third player, Ben Parker as well. What does Ben bring?

James: So, from my side, I would say I also bring that deep expertise and market knowledge and Sarah will talk about her product background. Ben actually rounds off with having a huge commercial drive. He’s run entire futures businesses at investment banks and also run FinTechs himself. So he brings a very deep commercial knowledge to round the circle between the three of us.

Julia: Perfect. Well let’s get straight into products. And I’m really curious because I was talking about your background there, Sarah. You’ve worked in other crowdfunding organisations, other SaaS products. So what on earth appealed about the world listed derivatives that you went, that’s what I want to do?

Sarah:  Great question. I think it’s actually, I felt really bad for the people that have to work in the world of listed derivatives. In my world, we deliver technology to make people’s jobs and lives better and easier. And I was just going to meetings with James and seeing the technologies and products and tools that they have to use every day, and they’re not the best, I have to say. And so I really felt bad and thought, gosh, it was so apparent to me that it was just ripe for innovation  and a real problem to solve for users and for companies and that technology could really make people’s days better. If you have to trade block size listed derivatives, bringing technology to them and offering a platform that would help make their day better and less stressful and easier, that’s what I love to do. And so it just seemed like a great opportunity and amazing to get to work with Ben and James, both of whom have really deep experience in listed derivatives. What I could do is bring to the team the technology side. How do you use technology to solve those industry problems that have been around for so long in a way that would really delight customers and users and make their day better? So I jumped straight in and I love it.

Julia: Brilliant. And the reason why I start with understanding the team is because so often we get into the features and the benefits, we get into the market challenge, but so many times people will tell us when we’re doing our coaching that actually hearing the stories of the founders and understanding how they come together and the various attributes that they pull together to create a really solid leadership deeply, deeply matters. So let’s get into the market challenges that we’ve talked about lightly and get a little deeper on that. Because I’d love to come to you, James, and think about it, we were talking about the last bastion of automation and electronification, if you like. Expand on that a bit and just talk about some of the dynamics and some of the risks, and some of the rewards that are at stake.

James: One of the reasons why it’s been very hard for people to automate is that there’s an enormous amount of complexity with exchanges and even the instruments within that exchange. So a fixed income contract may work different to a commodities, which may work differently to an equities product. And understanding all of these nuances, it’s absolutely key to ensuring that we can automate that process. Now, when you don’t automate it, what can often happen is that something may be late to be blocked, which will cause downstream problems or ensure that the trade will need to be renegotiated. Also, if it’s being negotiated poorly because it didn’t understand the rules, it again maycause the trade to be negotiated again. So for a buy-side client, often they think that when they have the correct price and they’ve executed on it, that that’s the end of the trade. Well actually, that’s not the end of the life cycle.

The sell side then needs to physically get it onto the exchange, and we can also help there. So it’s not simply about getting two clients to match or getting a risk price to a client. It’s also about doing it in a way that ensures that it’s going to be executable and that you’re not going to have to renegotiate it.

The final thing to say is that finding liquidity can be very challenging. And what we can allow, is, we can allow an all-to-all network. So any client can match any other, and they can run that process in an electronic fashion rather than needing to find a specific time to contact a lot of their executing brokers simultaneously. We can manage that entire process, make their lives much easier.

Julia: And of course, when you look right the way across the world of capital markets, again, these are behaviours and working operational structures that existed for many, many, many years. So it almost feels like it’s about time this happened. Sarah, let me get into a sense of, how is business going? I mean, how is the product development? Where are you?

Sarah:  It’s going incredibly well and we’ve been really busy over the last six months. It’s a huge domain and there’s hundreds and hundreds of problems within it. And so we’ve had to do a lot of research to understand the thousands of problems we could solve, what are the few we should focus on solving first and why? And James and I spend a lot of time thinking about this strategically so that we have a really deliberate and thoughtful roadmap that enables us to deliver the product in a really safe and incremental way. So once we’d spoken and done a lot of research and really listened to the main pain points, the major pain points that our customers are experiencing, we were then able to look at, okay, what is the best way of solving these problems? And best includes doing so in a way that is high usability for the user. I see that with the products that they currently have to use today. They’re very complicated and difficult to use. You have to have a lot of training. And we set out to deliver a product that was just delightful and easy to use.

I think we’ve achieved that during our go-live. When the product went live, we had someone we weren’t expecting to log in, who logged in, and they were able to use the product completely on their own. They didn’t need any training, and that was a real marker of success for us that we had built a very easy-to-use product. During the research, we were also working to ensure that we could fit into the user’s pre-existing workflow. We knew that we had to do that in order for them to adopt the product. And we also had to ensure that the product solved the problem significantly better than how the users would currently solve the problem today, again, in order to get that adoption that we want. So, having done all of this research has meant that we’ve been able to deliver to the market a product that people are really getting a lot of benefit out of using and really enjoying using.

Julia: We talk a lot in technology about you want not just minimal viable products, you want ultimate lovable products that people are just delighted to use. But also, that is more than incrementally better than what they could do themselves with a bit more work, which is phenomenal to hear. But let’s get into the trading calendar, if you will, and people often talk about the quarterly roles. For the benefit of the listeners, can you just talk to us about there’s this climatic moment, the way you really deeply matter. How does that work, and what’s different? How are you changing that?

Sarah:  Every quarter is a really frantic period, the quarterly roles. And for us, that puts a lot of pressure on us to make sure, and we actually went live in the June roles and it was a huge success, and the product, the platform really stood up to the challenge of that period of time for traders logging in successfully using the product, doing what they need to do. We want to go one step further though than that. Traders have to trade listed derivatives daily. And for us, the real ambition is to be able to have users using the platform every day. So, no matter what product they have to trade, no matter what exchange it is on, they will be able to log in and use the product every single day to meet the challenges of trading block-size listed derivatives. And the experience that they get is effectively they log in, and we have integrated with all of their systems, so their OMS or EMS systems, so they can log in, they can see the trading order there in our platform, and they see an order book where they can trade with anyone. It doesn’t matter who their executing broker is.

So we’re really emulating the conditions of on-screen trading for block trading. And that was the standard we needed to achieve that 10 times better than how they currently solve the problem. So we’re moving away from that on the phone to brokers manually tracking different conversations to just everything in a single location in a digital platform where they can very quickly and easily trade or match blocks as if they were trading on screen, so they can realise the benefits that they get from block trading.

Julia: If we start to get into the sense of who the users are, the personas, if you like, of participants, you’ve talked a bit about exchanges, we’ve talked a bit about, or I’ve got certainly got a feel for what this means for the sell side. James, what is it particularly about InTick that appeals to the buy side?

James: The buy side currently has the same issues that the sell side has in that it’s an enormously human process that’s manual. So, where errors might happen on the sell side, errors might also happen on the buy side. Also, when we consider something like the quarterly rolls, they’re doing it once a quarter, so it’s taking them away from their day job. This isn’t something that they want to be spending a huge amount of time doing or watching an algo for multiple hours. They genuinely want to get done quickly and easily with the least amount of risk possible, but also meet their best execution requirements. So it’s about providing the correct amount of liquidity on the platform, doing it in a way that’s intuitive and allowing them to trade quickly and safely. And that’s generally what we find with the buy side that they’re looking for.

Julia: And from that, let’s pivot towards the sell side. It’s a question for either of you really. So what is it that the sell side particularly love?

James: The sell side would also feel the productivity gains. But really, a lot of the process that we look at traditionally, a sell-side desk will do the rolls also, they will also negotiate very complex trades. And what we look to do is take away some of the more simple product trading that they do and automate that and allowing them to spend their time negotiating higher value trades. And finally, from an exchange perspective, the exchanges love the idea of trading the blocks electronically because what it allows them is consistency in the way things get blocked, fewer errors, more standardised processes. Also, it allows the executions to hit the tape quicker, making the trading feel more like electronic. 

Finally, by providing clients with a better way of trading to give them overall better pricing, it should encourage clients to trade more futures. And ultimately, that’s what everyone in the industry wants: greater uptick of the products because it’s cheaper and easier for people to trade them.

Julia: Well, Sarah, let’s begin to think about what the future will hold. We’ve got the three participants, exchanges, sell side and buy side, all set to gain from working with InTick. As you look ahead, because you painted a very clear picture of the research that’s brought you to this point, how you’ve launched and how you’re gaining early traction, what’s on the roadmap ahead?

Sarah:  So for us, because we’re getting such traction from customers and in those conversations we hear from them the exchanges that they care about, the products that they care about. So for us, it’s how do we scale as quickly as possible in order to meet that demand? So we’re in conversations with all of the major exchanges, and as James said, they’re incredibly receptive and very enthusiastic about what it is that we are doing. So much so that they’re keen to work with us on the integration. So we are working to scale the product so that it can support all of the portfolio of a portfolio manager as they’re looking to trade across all of the major global exchanges. And then all of the protections and functionality and features that are needed for users to come into the platform and feel very happy using it as if they were trading on screen. So it’s a busy time for the technology team, and there’s lots to build, but it’s great to have all the client demand and needing to race to meet that demand.

Julia: And I wonder if I could just ask you another question, which is – a lot of early-stage companies want to achieve the traction that you described, that demand that you described. If there were one or two critical tipping points, if you like, could you describe what they might’ve been?

Sarah:  Sure. Certainly, the first one was being accepted onto the accelerator program for the Investment Association. So that is the trade body effectively for our target customer. And so to get that endorsement from that organisation, that not only is InTick solving a known industry pain point, but it’s solving it in a way that’s really valuable to customers, that really expedited things for us because it meant we got access to talk to a lot of our target demographic. That’s been huge for us. We’ve also successfully closed a funding round, which is enabling us now to continue to invest in the technology and the growth and really get out into the world and start telling everyone or keep telling everyone what it is that we’re trying to do and what we’re doing and how we can really help companies meet their strategic goals with our platform.

Julia: And those tipping points really matter. And it’s wonderful to hear some insights into what they’ve been and how they’ve propelled the business forward as well. James, let me come to you perhaps with some final thoughts as we close out the show, which is really to get a sense of the big picture. So when you look ahead, when you think about the business, when you think about also your customer groups that we’ve described and the industry dynamics at play, what are you particularly focused on?

James: I think responding to client demand is absolutely critical. Listening, keeping engagement and ensuring that we’ve got the correct product for the future and the investment really helps there. But also, what we do is not just solve solutions for one group; we look to solve solutions for the entire industry. And that focus has served us really well because no one in the industry works in isolation. You’ve got the buy side, the sell side, and the exchanges and other vendors. And we all need to work together as a group, and I hope that InTick provides the conduit for that to happen in terms of the electronification. Because we only provide one part of the whole process. And I think a key element, a key tipping point that I’ve seen is that engagement from all the groups. And that’s really what we want to strive for. And really, my goal as I look to the next years and decades of this business is to ensure that we maintain that balance of being there for all of our clients.

What we often found on the desk is that we couldn’t take on any more clients. We were just too busy. And by allowing the execution desk to do more, by taking some pressure off them, it should allow a commercial expansion that will benefit the sell side enormously.

Julia: It’s always a joy to interview people on this podcast show because you get not only a sense of what the market challenge is born from real experience, real experience. You’ve sat on the desk, you’ve sat in those chairs. So much so that you both and Ben have stepped forward and gone, we’re going to solve the problem. But we’ve had some really great insights into what you’re focused on, how the research has borne out to be true, how you have found these tipping points and really grasped them, but also what the true value to each of those participants will be, whether you’re in exchange, whether you’re sell side, whether you’re buy side. And I get this real sense of passion for the challenge, which is phenomenal. Sarah, thank you so much for taking the time.

Sarah:  Thanks for having me. It’s been great talking to you.

Julia: It’s been a great conversation. And James, thank you very much indeed.

James: It’s been an absolute pleasure. Thank you.

Julia: Well, to all the audience, thank you as always listening to StreetsTalksTo. I’ve been talking to InTick and if you want to know how to find them, go to the website intick.com or indeed you can follow InTick on LinkedIn. This has been StreetsTalksto InTick with Julia Streets. Thank you again as always. And until next time, goodbye.

This episode of StreetsTalksTo was produced by Podshop on behalf of Streets Consulting, Ltd. At Streets Consulting we are a strategic business development, marketing and communications consultancy focused on helping financial services and technology clients around the world. Every client is focused on growth and transformation and as FinTech PR specialists. So we are there to help them every step of the way. We do this through our three Cs, campaigns, content and coaching, because we never forget the human in the mix. You can find this episode on streetsConsulting.com and using the hashtag StreetsTalksto. And we can also be found on LinkedIn and on YouTube. Thanks for listening.