E-finance isn't the playground that it was a few years ago, when just about any idea with a dot-com suffix got funded and business fundamentals didn't matter in the slightest. Still, it's not such a bad place to be. As our third annual list of the 30 most fascinating players in international online finance attests, the late-1990s explosion of technological creativity left a lasting impact on financial services. Many innovations , and the visionaries who championed them and appear in the profiles that follow , are doing quite well, thank you, despite the sustained bear market in technology stocks and the aftershocks of September 11.
To be sure, the economic climate is more sober than even last summer, and budgets are tighter. "Everybody is rationalizing and studying," says Alexander Hungate, CEO of global marketing for Reuters Group. "People are investing, but only where they can see benefits in cost reductions or in customer service."
Desperate to become more efficient , in retail banking or brokerage operations or back-office securities processing , financial institutions are keeping the
e-finance revolution alive. Overall, international technology expenditures fell 1 percent last year, according to a Merrill Lynch & Co. survey of corporate chief information officers, but financial firms are spending more. "The industry increased its budget last year 7 or 8 percent, and this year it is looking at 4 to 6 percent. Even the smaller numbers are huge, on top of a base of $330 billion globally," says Scott Wu, general partner of Financial Technology Ventures, a San Francisco firm that manages e-finance investments for 39 institutions worldwide.
Where are the industry's tech funds flowing? To securities exchanges like Euronext (see Jean-François Théodore, No. 1, below) and EuroMTS (Gianluca Garbi, No. 4) that promise to spread and lower participants' costs. Or toward ventures like Identrus (Guy Tallent, No. 25) that address heightened post,9/11 security concerns. And while online brokerages like Comdirect (Bernt Weber, No. 7) and Boom.com (Mark Duff, No. 22) are suffering in the bear market, multichannel or "bricks-and-clicks" strategies like those of ING Direct (Hans Verkoren, No. 5) and Cortal (Olivier Le Grand, No. 6) are proving to be much more robust.
"It's critical for institutions to augment their technology now," says Rob Heyvaert, CEO of Antwerp, Belgium,based consulting firm Capco. "If they do it right, they will not only take costs out, but they will get closer to their customers."
To view this year's top 30 in international online finance, please click here or go to the Research & Rankings section of this site.