Ever since a particular high-level conversation, I’ve been wondering on why motivating and managing employees in a Fin-Tech business is so different from managing them everywhere else. It’s often also exacerbated by the entrepreneurs coming from non-finance background conflicting views on the utility of money. I’ve decided to write it up – mostly to help me gather my thoughts – but also to explain this problem, and unlock significant frozen reserves of capital and equities hidden in various companies out there.
In a Silicon Valley world, money is simple. Entrepreneurs sell products to customers, customers and employees earn money to pay for (mostly) standard of living they enjoy, overheads can be invested, and often the best investment is the investment you understand, hence, they accept lower salaries for higher equities.
In a London Fin-Tech world, money is simple, but different. Entrepreneurs sell products to businesses, which make purchasing decisions based on supporting their investment performance. Employees, having spent good portion of their prior careers in finance, apply modern portfolio theory to their purchasing decisions, and earn money because it is, by itself, quite rewarding. When it comes to equity, cash is just baseline risk indicator, period.