Financial Services

Financial Services Firms Must Clearly Convey Thier Value Proposition - As Well As Their Positions on Environmental, Social and Governance Issues - to Remain Competative

A New Mandate for Financial Services Companies

To whom much is given, much is expected. 

For decades, the financial services industry has profited (and in many cases been saved from collapse) through government policy and taxpayer support.

And now it seems the financial services sector is being asking for the favor to be returned. 

Government policy makers are mandating that banks and other financial services firms lead the fight against some of the biggest issues of our time, including climate change, income inequality, and racial and gender inequity. 

Policy makers believe that the financial services sector has the power to “fund our way out” of the social problems mentioned above, by increasing access to capital to certain demographics and projects and limited access to capital to others. 

Through Social Good Comes New Opportunities

As social and environmental consciousness continues to increase, we believe that vast new “blue oceans” will reveal themselves.  Well positioned  financial services companies will benefits from expanded opportunities to lend on affordable housing, clean energy, and sustainable farming – as well as expanded opportunities to service minority owned businesses.   Further, as technology continues to reduce transaction costs, more opportunity will be unlocked to serve the unbanked and underbanked — giving those in the lower tiers of the socioeconomic hierarchy the necessary tools to build personal wealth.  

At Glass Box, we aim to highlight how the changes taking place in this sector will benefit your business model going forward. 

Developing Effective IR

Below are a few points that we aim to address throughout your communications. 

1. Where is the financial services industry heading? And how do you play a role?

The financial services industry as a whole stands well positioned for significant growth over the coming decade.  As banking and investment services continue to transition to digital platforms, transaction costs are reduced, and new markets are opened up, the opportunities to capture new accounts abound. 

  • The global payment processing solutions market is expected to grow at a compound annual growth rate (CAGR) of 14.5% from 2020 to 2027 according to Grand View Research. This projected market growth can be attributed to high penetration of smartphones and adoption of mobile payment applications
  • The online trading platform market is expected to grow exponentially as well over the same time period. Robinhood by example, had only 500,000 users in 2015 and by 2021 had over 18,000,000 users.  As other brokerage firms digitize their platforms and eliminate standard commission charges, they are expected to increase their user base as well.
  • Banks and investment firms that can find a way to service the unbanked (people that don’t use any debit cards or bank accounts) and underbanked (people forced to use alternative financing services, such as money orders or rent-to-own solutions) in the U.S. are expected to thrive.

Investors in financial services want to know how you will play a role in these macro-level trends. 

2. What are the major challenges that lie ahead Within Your Industry? And how have you accounted for them?

Rising interest rates, increasing competition, and tightening regulations all threaten to impact margins in the financial services industry. Investors in this sector want to know how you will deal with each of these challenges.

As rates rise, do you believe this will drive away customers—or perhaps allow for margins to expand?

As more entrants enter the field are you at risk of losing market share—or, perhaps, will this cause the weaker players to fall out and leave you even better positioned than before?

And as regulations tighten, will you be faced with decreasing margins due to increasing compliance cost—or will new rules cause new profit centers to emerge?

Investors will want to know how you have planned for the challenges ahead.

3. Does your Management Team Have the fundamental elements needed to succeed in Your industry?

Both direct and second market investors will commonly state that they prefer to invest in “quality management” as opposed to a specific product or service. Today, however, “quality management” is no longer just another way of saying management with the right “pedigree.”

Quality management must be adaptable.

Quality management must be forward-thinking. 

Quality management must be capable of course correcting as the market shifts, as technology evolves, and as consumer and business demands change.

Today’s managers must possess a unique blend of attributes to succeed. 

At Glass Box, we aim to highlight your management’s capabilities through narative story telling—offering examples of your team’s ability to adapt and progress in the current climate.

Are You Ready To Learn More?

We want to 10X your investor exposure, and help you elevate your brand. Contact us today, and let’s talk about how we can get your company on the map and create more sustainable shareholder value for years to come.

Get In Touch
18201 Von Karman Ave, Suite 300
Irvine, CA 92612
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