Leda Writes for Fintech Futures: High school jocks living their best lives

Each week, Leda Glyptis, CEO of 11:FS Foundry, creates #LedaWrites. This week, with the aid of Bryan Adams lyrics, on why the best is yet to come.

I love me a bit of optimism.

I do.

Even if it spills over into wishful thinking.

It’s a superpower. It’s the thing that keeps us trying and striving and pursuing impossible dreams. It’s why we sometimes win against impossible odds.

Because we try.

Because we fight.

Because we hope.

And so many of #mytribe are burning bright with this flame right now. Seeking to see good in the world. Seeking to believe that the best of humanity will shine through the mire. And that the industry will finally see the light and give in to the inevitable onslaught of change. Make the right choices, let go of sacred cows and profitable monstrosities.

You will see, a lot of friends say to me, you will see. There is no choice. It will happen. It is bound to.

Ah.

That old chestnut.

There is an old Bryan Adams song that goes, “aint’ funny how time flies, when the best is yet to come?”

And the only consistent truth of my nearly two decades in this industry is that we are all convinced it’s coming. The best bit. It’s coming.

So we wait.

Yes, Bryan Adams still. If I can’t sing what I like in the middle of a pandemic, when will I get to do it?

And the only consistent truth of my nearly two decades in this industry is that we are all convinced it’s coming. The best bit. It’s coming.

So we wait.

Not idle. But wait.

Because it’s coming.

Right?

Wrong.

High school jocks

I didn’t go to an American high school but I have seen enough movies to recognise the hammed up, stylised universality of the experience: some kids were cool. Some kids had it all. And at 15, neither they, nor we imagined that their awesomeness was transient. That there may be a world or a moment in time when they were not top dog. And yet, the roll call of “where are they now” rarely ends well for the captain of the football team, the hot kid in the top set, the homecoming queen or the troublemakers in the back row. They didn’t know and we didn’t know but that was their finest hour.

It was not the start of a shiny story. It was its peak.

Would they have felt differently had they known? Would we?

The assumption that things will be ok in the end and if they are not ok, it’s not the end is not just a cheesy line delivered expertly by Dev Patel. It is a deeply ingrained meme of western civilisation. Alongside expectations of romantic love materialising for everyone and the belief that justice eventually prevails for all. And just like those other expectations, it has no base in scientific truth. And yet we go on expecting. Not hoping. But genuinely axiomatically believing that, no matter how good things are or how bad they get, the best is coming. For us all. We deserve it. It is ours. And it is coming.

The bad days will clear.

The good days will get better.

The best is yet to come.

It is undeniable that the industry has had a couple of centuries of amazing growth, creative freedom, prosperity and profit beyond belief

Say that to the jock on graduation day and he will believe you.

Tell his overweight, disillusioned future self on his 50th birthday and his mirthless laugh will ring in your ears for days.

What does that have to do with banking?

If it is not already obvious: we are the jock. And our time is running out.

I am not being dramatic here. Just factual.

“You had it there then it slipped away, yeah you left the song unsung.”

Yes, Bryan Adams still. If I can’t sing what I like in the middle of a pandemic, when will I get to do it?

But hear me out.

Whether you think the golden era of banking came with Alexander Hamilton (yes, the famous one – and before you scoff: I do. Because I grew up in BNY Mellon and the history feels personal, so there. That’s my origin story. You go pick yours.); or you think it was the original Lehman dynasty, Henry Morgan and Harold Stanley audacious and opportunistic; or if you fancy a bit of ruthless and soul-less Gordon Gecko (no, not a real person, I was just checking if you were still paying attention), it is undeniable that the industry has had a couple of centuries of amazing growth, creative freedom, prosperity and profit beyond belief and more than one “hall pass” where recessions and depressions were caused and survived seemingly without sweeping consequences.

Yes, the industry is much more constrained and regulated than ever before.

Yes, things have changed. Small things here and there.

But the fundamentals of how money is made, where profitability comes from, how service is understood, regulated, delivered and priced has been adjusted not transformed.

Sure… it’s much more controlled. Sure… digital distribution has imposed some change.

Sure.

But a little change does not transformation make

Change has been managed... to ensure that as much of the old world survives as humanly possible.

And that has not been accidental.

Change has been managed to ensure not just ‘the best bits’ of the old world survive. The aim is to ensure that as much of the old world survives as humanly possible. And then some.

If you ask the high school jock to determine what the future looks like, his skills will still matter. His popularity will remain unassailable and based on the same criteria that got him ahead so far. If the best is yet to come and he gets to decide what that is and how we get there, what do you think he’s going to do?

Repacks for the masses

Repacks were my moment when I knew banking is a “through the looking glass” world.

That was my door.

I walked through it and I never looked back. If you were hoping for a redemption story, this aint it. Or not fully.

Repacks were my moment when I realised, “oh man, this is messed up” and “this is a world unto itself” and “oh wait, now I get it” and “hey, I can help fix this” all wrapped into a tight bouncing ball of energy and hope.

I remember where I was sitting, who I was speaking to, what the piece of work we were trying to get over the line was. And repacks were incidental to the work. But I had a moment of lucid realisation: that a repack is essentially repackaged debt (credit card debt has to work for a living, it turns out) and once it’s been repacked it gets a capital R and it’s no longer other people’s debt but an instrument. A vanilla security, really.

Or is it?

A Repack is essentially a bankruptcy-remote special purpose vehicle issuing a bond (repack notes are bonds, essentially, backed by existing debt). Want me to say that in a way your granny would understand? We take debt we hope won’t default and turn it into an investment vehicle.

Don’t look at me like that.

I know you know.

In the more mundane and less lucrative end of the industry, hard-wired COBOL code bases are straining under the pressure

I also know you never stop to think about it because it is “how things are”, “how the world works”, “how it is”. Or maybe you don’t know.

Because you work in a different department and all that stuff is so technical and boring and run of the mill anyway.

Right?

Wrong.

What if you are the jock? What if you have already lived your best life? When coming up with Repacks was a creative coup? When not knowing what repacks were didn’t stop you from making a highly profitable living in the department next door? When deciding which bits of your own playground you wanted to keep, was part of change and you didn’t even know the silver spoon was in your mouth?

Sounds pretty good, considering, doesn’t it?

Even in times of stress and strain, it’s been pretty good even when it didn’t feel that way.

And now we are in a pandemic.

And the markets are behaving unpredictably (some areas are making a killing still, there is always a pocket, there are always reasons) but people are kept awake at night wondering if they will still have a job at the end of the month. Musicians and shop keepers. Hairdressers and electricians. Copywriters and dry cleaners. Real people who own the cards behind the

Repack and now they are maxed out.

They are loking at their statements, month end, wondering: will I make it?

Even the guy working from home on the next Big Bank algo platform upgrade doesn’t know if his job is safe. Even though he knows the bank is, as is the platform.

The best is yet to come. In that, surely, it is not hard to do better than this.

And in the more mundane and less lucrative end of the industry, hard-wired COBOL code bases are straining under the pressure of needing to change disbursement schedules, and interest rates to honour verbose government promises that may or may not come with some back-of-an-envelope mathematics and some inflationary policy acrobatics in our immediate future. But that’s someone else’s problem, right? Because it will be ok, right? Surely, after the pandemic, the best is yet to come, no?

Maybe.

Hopefully.

But when it comes to banking as we know it, I would say don’t bank on it (see what I did there).

The best is yet to come. In that, surely, it is not hard to do better than this. We have the tech.

We know how many humans and communities we are letting down. We know that Repacks were not a thing that should have ever made sense, if you think about it.

So yes.

I do hope and trust that the best is yet to come.

I do believe in a banking infrastructure that is lithe and agile and committed to the service of its communities, its people and their needs.

I do believe it is possible. And I believe it is necessary.

But I do not for one moment believe it is inevitable.

Not because I am not an optimist. But because I have seen the game stacked before. I have seen the high school jock holding the pen and dictating a future where he gets the prom crown year after year. And ain’t that nice for him. But in real life that is not how it goes. And it’s time real life caught up with all of us.

The next step is going to be about stopping old things and starting new ones. Not just doing things differently.

We have the technology to do better than we are currently doing.

We have the moral imperative to do better than we are currently doing.

And with every passing week of cumulative COVID-19 related and lateral tensions accumulating relentlessly, we will have no choice but to do better than we are currently doing.

But the game of doing better at the thing we’ve always done, is up.

Better now is “altogether different”. What passed as cool in high school is a thing of the past.

The world has changed. Times have changed.

Banking is changing, accidentally, slowly, unwittingly, inevitably.

And now this.

So the next step is going to be about stopping old things and starting new ones. Not just doing things differently. The time for that is past.

And that is where my tribe’s optimism may be a touch misplaced… The best is yet to come, for sure. Not by the industry’s traditional metrics of success. Not for the high flyers and their end of year bonus, perhaps.

The best is yet to come, but it will look very different.

It will change everything we know about how things are done, measured and rewarded. So much so that many of the folks making decisions today may look at what’s coming and not see a shred of good in it, let alone “best”.

The best is yet to come, but it will look very different

But they are not the ones it’s for and that is the biggest change. It will come to them and despite them. It will change the industry they built, and through it, we will be part of the future at last. And the best shall come, finally, for the people we serve.

Wait.

Why isn’t that Braveheart shmaltz not the closing line?

Because what stands between you and that moral high ground is not a greedy banker but an ageing code base. The tide doesn’t turn with an epiphany and some capitalists deciding to

Be Better. The story changes with mainframes and lines of code. A lot of lines of code. The story changes when we start rebuilding. And as all feats of genuine effort it takes time, work and foresight.

But time is in short supply.

And I will not spend the little time we have left explaining to those of you who still want this to be emotive rather than practical that the problem is not culture and people. You are right, systems mirror human conduct. But systems are bad habits made concrete so, although philosophically… sure… you have a point, practically our world is on fire and if you fight the hearts and minds battle you will go round in circles and still have crumbling infrastructure… and fire.

So change the infrastructure. Put out the fires. Serve your communities.

Those who feel the place you are offering them into the future is not shiny enough, can and will be left behind.

Don’t feel sad for them.

You have found your very own high school jocks.

Whose best life has been had and the best that is to come owes them nought. And they have held it back long enough.