Spoiler: Speed Is One of Our Habits
Steven O’Hanlon, Numerix CEO
“Be so good they can’t ignore you.” This quote by comedian and actor Steve Martin accurately defines one of my most closely followed mantras. It’s about “keeping the buzz going.” Keep it going in our marketplace, keep it going for our brand and keep it going for our reputation.
In my view, delivering on this requires:
- Developing a culture of innovation
- Listening and trusting
- Focusing on being nimble
- Being willing to take risks
For me, a way to fulfill this agenda is by seizing and maintaining a startup mindset. This approach has been strategic in helping me generate success for our organization.
Imagine What Can Be
Numerix is a well-established and successful fintech that serves the capital markets industry by providing innovative, next generation technology solutions for the trading and risk operations of banks, asset managers, broker dealers, hedge funds, insurance companies and pension funds. We are way past the start-up phase; however, we still embrace the startup mindset.
I strongly believe that thinking like a startup provides significant advantages when operating in an increasingly complex capital markets world. For one, it helps a firm adapt quickly and capture opportunities faster than slower, traditionally minded competitors.
So, what does a startup mindset mean for Numerix? We spend our time imagining what can be, rather than what is. Our business planning, our product development, our quantitative research, and our sales and marketing strategies are all focused on our desired future state.
Having built seven startups over 34 years and now running Numerix, I have a pretty good view into the startup mindset. Here are four of the core “startup” attributes I use to help differentiate Numerix.
1. Keep a Focus on Innovation
For startups, innovation is treated as a team sport. I have experienced that innovative ideas can come from anyone. While our top sources for product innovation are our financial engineers and quantitative researchers, employees in all job functions and at all levels at Numerix are encouraged to come up with innovative ideas. If an idea is accepted, the support is provided to put the idea into practice. Innovation is not the province of top leadership.
Numerix does not rely on strict hierarchies. Like many startups, we wish for all employees to feel empowered to make a difference. If we make that part of our culture, everyone is more likely to buy into the company’s vision and contribute to its success. I don’t listen only to the people at the top, I make a strong effort to hear everyone’s voice. Their insights can be just as valuable, albeit in different ways. The secret sauce is our people.
2. Listen and Trust
When Numerix started out, we did not have the benefit of having a parent company we could rely on for support, advice or consultation. We had to learn on our own. This meant we had to listen—listen to our employees, our clients, and our growing network of partners. We also had to trust who we listened to, so we sought out those who understood us, understood our culture, and who we could rely on to tell us when we were doing things right and, more importantly, when we were doing things wrong.
We were a small company, so we knew we had to augment who we were through our clients and partners. We did not want to be viewed as just another a company that sold financial-related software. We wanted to be known as a company that wanted to go on a long journey with our community, that we wanted to be committed to long-term relationships and to always be there when our clients and partners needed us and vice versa. We did that by including them in our growth—by asking questions, seeking advice, and listening and trusting.
This type of thinking continues to permeate throughout Numerix today.
3. Be Nimble
The fast beats the slow. Startups have a sense of urgency and use speed to their advantage and sprint toward their goals. I try to foster a sense of urgency at every level at Numerix. When we see an opportunity, we must act fast. Our market and our customers won’t wait. Now, I want to clarify that by urgency I do not mean being manic and treating opportunities as if they are emergencies. I simply mean being proactive and “quick to seize” while also being vigilant in trying to avoid getting slammed by any potential hazards along the way.
Here’s an example of how I exhibited urgency towards an opportunity that resulted in a great outcome for Numerix.
I recognized very early on, right at the cusp of the 2008 financial crisis, that failure, reputation damage and, ultimately, risk management, would enter into extreme circumstances for capital markets players. Seeing how the crisis would expose gaps in the risk management practices of financial institutions, I quickly pivoted Numerix into the broader capital markets risk management space. We introduced new analytic offerings and derivative pricing solutions that became game changers for the firm and the financial services industry.
The watershed moment was the fall of Lehman Brothers. With trillions of dollars in outstanding derivatives needing to be reconciled with counterparties, Numerix was selected on behalf of the Lehman creditors to value millions of terminated trades. This was arguably the most complex and one of the largest derivatives’ portfolios in the world.
Not only did Numerix facilitate the unwinding of these positions, but because of its work, Lehman was able to return over $15 billion to creditors.
As Numerix worked side-by-side with the Lehman traders and IT staff, it was clear that a more integrated and holistic approach for managing risk was not something that was nice to have, but a requirement. Through this experience, I recognized an opportunity to look at risk differently. So, I made the key decision to re-evaluate Numerix’s core analytics solution and creatively determine how it could be maximized to pivot the organization into what became a rapidly changing market of derivatives risk management. Numerix is today recognized as the leading risk solutions provider in the capital markets.
4. Take Risks
Hockey legend Wayne Gretzky once said, “You miss 100 percent of the shots you don’t take.” He took a lot of shots and made a lot of goals. He won four Stanley Cup championships and holds 61 National Hockey League records.
Startups need to take risks—they need to shoot for those goals. However, many business leaders view taking risks as a reckless activity. In business, risk is certainly associated with potential danger or loss.
I certainly understand that. Regardless of how much planning and calculating we do, Numerix can never know if a risk we take will pay off. However, this does not deter us from taking what we view as the risks—the shots—we find necessary to get the edge over the competition.
The Benefit of not Being a Startup? Wisdom
As I mentioned earlier, Numerix has been around a while and we are a fintech veteran. We’ve learned from our lessons. We’ve seen what doesn’t work. It’s important for me to continuously acknowledge that some of the attributes and habits of a start-up mentality can hurt an established company (e.g., quick-decision errors, insufficient planning, no map for long-term growth). It’s important to be cognizant of the fact that 90% of startups fail.
So, I guide Numerix in capturing what we think are the best attributes of startups, but ensure we leverage our experience and wisdom to avoid newbie mistakes and deliver the best to our clients.
Steve O'Hanlon is president and CEO of Numerix, a Fintech specializing in solutions for capital markets. O'Hanlon has spent his 25+ year career in leadership positions growing start-ups and SMBs across the financial services technology industry. He has a passion for entrepreneurship, leadership and innovation. Today O'Hanlon is focused on building businesses, promoting a digital mindset and driving success.
