FINTECH IN FOCUS: What the Rise of Regtech Can Teach Marketers about the Power of Specificity

September 13, 2017

Crisp messaging, targeted outreach and educational thought leadership are key to establishing market differentiation and ROI

- Tylor Tourville

Today we find ourselves living squarely in the middle of the fintech revolution. Established fintech companies like Kabbage and Stripe have cemented their places within the financial services industry, while investments into startups are poised to reach a record high in 2017. During this period of maturation, the expansive world of fintech has begun to define subsectors of companies aiming to serve specific industries and address more nuanced issues within financial services.

Regtech is still in the early stages, in terms of the number of startups and the amount of funding companies have received so far. However, in looking at the subsector’s growth trajectory, it’s on track to make a significant impact on the financial services industry in the very near future.

Over the last couple of years, regtech has emerged as one of those innovative subsectors under the fintech umbrella. Just as fintech companies sought to disrupt the relationship between financial services companies and their clients and customers, regtech companies aim to alleviate pain points that exist between financial services firms and regulators.

Employing technologies such as automation, artificial intelligence and big data analytics, regtech fills a void in the market to resolve inefficiencies and help financial institutions not only comply, but thrive in any regulatory environment. Still adjusting to a post-2008 financial crisis regulatory landscape, many firms find themselves unprepared to keep pace with changing regulatory obligation due to outdated, manual-based legacy systems, and have turned to technology for solutions. Whether it’s for KYC, AML, or data management projects tied to specific pieces of regulation (Dodd Frank, MiFID II), regtech solutions present a very specific value proposition for these firms.

Examining the rise of regtech can offer communications professionals already working in fintech a reminder of the value of specificity when developing their own strategies to position their company or clients for success.

The State of Regtech

Regtech is still in the early stages, in terms of the number of startups and the amount of funding companies have received so far. However, in looking at the subsector’s growth trajectory, it’s on track to make a significant impact on the financial services industry in the very near future.

At a recent Boston Fintech “Meetup” event, one speaker from PwC estimated that there are currently more than 250 startups backed by over 500 investors. And according to CB Insights, regtech startups have raised $2.99B across 405 deals since 2012. This past year was a record year for regtech, with 102 deals being executed.

Regtech is poised to become the next subsector to emerge from the broader fintech umbrella, upending the status quo for financial services companies in how they approach regulation and compliance.

Targeted Approach for Regtech PR and Marketing

Being brand-centric is at the heart of any successful communications strategy. Between the pressures on reporters operating in a 24-hour news cycle, and the exponentially increasing volume of content being produced on a daily basis, having a targeted approach that is laser-focused on what your company brings to the market is more important than ever.

This rings especially true in the world of fintech, where the general audience and reporter pool shrinks dramatically. Regtech is an even more extreme example of this, which serves as a good reminder that when it comes to messaging, the more specific the better. Fintech communications professionals should prioritize establishing clear and concise messaging around their company and its mission. This messaging should in turn map to the specific issues addressed by the product and/or service offered and the value delivered to your customers. Being able to clearly and concisely communicate your firm’s value proposition and how it differs from the competitive set will directly influence content development and public relations efforts, ensuring the company’s story is heard by the right audience in a meaningful way.

Once the proper messaging is crafted, content development should aim to showcase and demonstrate firm expertise on the issues addressed in the company’s mission. Drawing again on the example of regtech, whether it is a blog detailing a specific piece of regulation, a white paper backed by a client survey or a bylined article tackling an industry-wide compliance issue, every piece of content produced should relate back to the reason why a firm is in business in the first place and offer educational, valuable insights to the markets they serve. When a prospect visits your website or social media profile, they will see exactly what the firm’s goals are, reinforced by insightful, relevant thought leadership.

Closely tracking the news and following reporters most relevant to the industry is also essential to a successful media relations strategy. In the world of fintech, building the perfect media list requires diving deeper into the pool of reporters and learning beats they cover, with the aim of presenting reputable sources with the requisite knowledge to enhance a journalist’s story.

While the title “fintech reporter” is becoming more common (especially amongst trade publications), often the reporters you want to connect with are the ones broadly tracking the movements of a general industry or end market, such as corporate banking or wealth management. This means keeping up on the news and noting which reporters are weaving technology (and compliance for regtech firms) angles into their work.

A great tool for easily keeping track of this is Twitter’s list function, where you can create your own categories of accounts that you follow. In narrowing your focus, your media list will most likely not be filled with hundreds of contacts, but that’s OK. As we’ve learned from regtech’s example, specificity is king.

Regtech appears to be bringing the next major period of innovation in the fintech era. Examining the subsector’s progress and growth potential through a marketing lens offers fintech communications professionals a valuable lesson in the power of specificity. Given the level of startup investments still flowing into the fintech ecosystem, competition will remain fierce, reinforcing the need for clear messaging and quality content to distinguish yourself from the competition.

Additional resources and articles:

For a deeper dive into the rise of regtech and its inner workings, I would suggest this recent piece from GT News that provides a thoughtful overview of the industry at this point in time.

For good examples of regtech’s specificity, check out this article from FinancialNews highlighting 10 regtech firms to watch for in 2017.

CB Insights, cited in this blog a couple of times, developed a Regtech market map that’s worth checking out, to see the breadth and depth of firms emerging in this space.