Michael O'Connell

"The typical meeting is a leaky time suck, absorbing people’s attention in a way that cannot be fully measured by simply counting up the total number of hours blocked out for calls," writes @DKThomp: theatlantic.com/ideas/archive/…

FAA Under Siege: The Dirty Tactics American Airlines and Southwest Are Using To Keep Air Travel Miserable - View from the Wing viewfromthewing.com/faa-under-sieg…

The Great Flattening Apple’s iPad ad might not have been good for Apple, but it was a profound encapsulation of what has happened on the Internet; the question is what it leads to next. stratechery.com/2024/the-great…

I think there are three disruptive forces reshaping Wall St 1. Fintech APIs 2. Fintech AIs 3. Tokenization They apply across all products and services, and there’s a patchwork of companies and founders attacking them. Here's how I think about the map Capital Markets are: 👉 Highly regulated. 👉 Highly manual. 👉 Hard to upgrade. 👉 Full of sunk costs. But that’s changing. But there are three big shifts occurring a) Banks have played less of a role since 2008; meaning new actors can fill the gaps b) Alternatives assets are becoming popular but lack market structure like exchanges or CSDs. c) We haven’t had a major tech upgrade since the 1970s and are due one Where are the opportunities? 1⃣ Fintech: BaaS for markets? API-first companies are already here. Companies like Drivewealth and Atomic Invest have collectively brought securities and some alternatives to market with APIs 👉 This will go wider into alternatives next 2⃣ Fintech: Platforms for debt raising. Companies like Finley, VaaS, and Setpoint help manage a debt facility. The Arc’s* venture debt marketplace is also an interesting twist on this idea. 👉 Every treasury team will have financial markets embedded in their treasury management software 3⃣ Fintech: Next Gen trading platforms and broker dealers. Younger funds and fund managers will likely adopt the lowest friction UI for trading. Architect* is an example of a company that offers derivatives trading to pro-sumer, startup, or mature funds looking for an ultra-high-performance execution platform. 👉 The next Apollo or Blackstone likely already exists and is currently quite small but using new tools (e.g. @LumidaWealth ) 4⃣ AI: AI analysts and agents. Agent Smyth analyzes stock and sector data to help traders prepare for their day or make a buy/sell decision. Lucite provides companies' business overviews, competitive analysis, and financial metrics as an analyst might export from Pitchbook. Finster is a former deepmind and JP Morgan team-building financial data analysts 👉 The first adopters will be a new generation of funds entering capital markets or in their early days 5⃣ AI: AI workflow tools. PDFs are the new oil. This model is popping up all over in Fintech, but it’s especially applicable to capital markets. Everything in capital markets runs on a PDF or spreadsheet, from KYB to ISDA master agreements. 👉 This is the low-hanging fruit use case and makes financial markets products embeddable and 10x less friction 6⃣ Tokenization: Tokenization of money market funds allows 24/7 access. Blackrock has launched a tokenized money market fund BlackRock’s new BUIDL fund, a month after its launch, managing $304 million in assets. Why? 👉 Every CFO wants instantly liquid, high yield products. That isn't true for MMFs today but is with tokenized funds. 7⃣ Tokenization: The tokenization of all assets is next. Cash, Stablecoins, Private Credit, Private Equity and commodities are all trading trillions of notional as tokens already. These three things lead to a 10-year shift that will become the biggest tech upgrade in financial markets since the 1970s. (Incidentally, the 1970s were when the “buy side” behemoths like Blackstone and Bridgewater got their start.) The adage “this won’t work for capital markets” is incorrect. If you enjoyed this, check out the link in my bio :)