If you work in investment banking technology, you should know the names of Kirat Singh and Mark Higgins. Both men have been at the heart of some of the biggest projects at large banks – Goldman Sachs’ SecDB, J.P. Morgan’s Athena and Bank of America’s Quartz.
Now, they’re trying to bring that technology to the masses.
SecDB was created in the 1990s and was known as Goldman’s ‘secret sauce’ behind its trading ideas that helped it navigate the financial crisis. After SecDB came Athena at J.P. Morgan, then Quartz at BAML. Since 2015, SecDB has been on an open source platform.
But for the past three years, Singh and Higgins have been working on a fintech start-up called Beacon. It provides a core platform similar to SecDB, but it also has a development functionality that allows programmers working for its clients to develop, customise and roll out analytics and apps. Hedge funds, banks, insurers and trading firms are all buying the product.
Michael Kirch, the former head of commodities strategies at Goldman Sachs, joined Beacon last year as chief commercial officer. The best analogy, he says, is to think of Beacon like the open platforms at iOS and Android that allow small teams of people to create products and deploy them within the app store.
“When building those apps, developers can immediately test the impact of their code changes on the app,” he says. “SecDB enabled that same iterative development style in the early nineties, and that’s not for individual user apps but for proper scalable enterprise applications, which is arguably a lot harder. Even today, the vast majority of enterprise applications are still built on heavily siloed architecture.”
Today, banks and other financial services organisations don’t need huge teams of technologists building these platforms from the ground up, he says.
Kirch, Singh and Higgins are leading the team at Beacon, but it has offices in New York, London, Berlin and Tokyo – and it’s hiring.
“We’ve grown from a handful to now over 25 employees in a year, and we’ll probably be double in size at the end of this year,” says Kirch. “99% of our people are deeply technical developers, some of them are more quant-focused, some more technology focused. What they all share though is a genuine interest in and understanding of the financial services industry.”
While most fintech firms hire in technical expertise from a range of industries, Beacon has largely tapped financial services experience.
Dave Hooper, a director and senior developer in London, joined Beacon last year after 13 years in the strats team at Goldman Sachs. Farai Mtetwa, a senior developer in New York, also joined from Goldman, while director Pawel Potocki came from J.P. Morgan’s tech team.
Beacon has been successful in hiring Wall Street escapees. At the time of his exit from Bank of America Merrill Lynch, Singh told us that there was a disconnect between those making the decisions on technology within investment banks and the people building the systems.
“Investment banking is still very siloed, and every department has their own code base, which makes these organisations incredibly complex,” he said. “This has to change, but it will be a slow process.”
Clearly, these senior technologists have been taking matters into their own hands.
Kirch spent nearly 12 years at Goldman Sachs in both London and New York. He was co-head of the commodities strategies team for the Americas from 2009-2011 and then headed up the same division in London from 2012 until his departure in June 2014.
He moved from London to Berlin, founding commodities analytics firm Covado in February 2015 until he joined Beacon in February last year. Kirch says that Goldman’s commodities business provided “a lot of exciting opportunities that required quantitative analysis and systems development that kept things fresh”.
“In the years following the financial crisis though things got a bit too quiet for my liking and I decided to leave in March 2014 to find something new and exciting, without a concrete plan at the time as to what that might be,” he says. “I haven’t spent much time looking back since.”
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