In his book “how to spend $75bn to make the world a better place” Bjorn Lomborg sets out to rank the world's problems (or more accurately, the solutions to the world's problems) to understand how to do the most good with limited resources.
It concludes that certain issues such as climate change, whilst extremely important, receive a disproportionate amount of resources relative to other important issues such as eradicating malaria, which gets less press coverage but really represents more "good for your buck".
Ultimately, whilst economics tells us to allocate resources to solutions which do a lot of good, right now, at little cost, we end up allocating too many resources to solutions whose narratives attract more attention.
It's a bias to be aware of in the capital market's fintech industry too. Specifically, the technology conversation in capital markets should consider the wide range of digital solutions and not limit itself.
For example, the application of digital bonds to the bond market is without doubt an exciting topic which will benefit capital markets, however it's important that it doesn't crowd out other areas of technology R&D. There is a lot of exciting work going on, away from digital bonds, which will also significantly benefit the industry, probably sooner and cheaper. Example areas of tech focus are roadshows, pricing indications, demand management, bookbuilding, document automation, new issue announcements, among others.
Take the Bots platform for example. We are streamlining bankers' everyday workflows like never before. Our focus is data aggregation, new issue pricing, client outputs. We don't use any blockchain or other ledger-based technology, but we are changing the way DCM professionals work in a meaningful way.
Capital markets participants know this and assess a wide range of solutions to a wide range of problems.
One may wonder however, why this isn't always reflected in the conversation at industry-level events or in trade publications. At various times the discourse focusses on a particular area, most recently AI, before that DLT-related tech, following the broader trend across the technology space.
To be sure, I'm not suggesting conference organisers, who set the agenda, are getting it wrong. Nor trade publication journalists who write the articles. It's just that some topics suit the format better because they cover more ground, reach a larger audience and offer more opportunities for a new angle.
All this to say that the capital markets are lucky to have many hardworking, visionary companies building tech solutions. Some may be in focus at different times, but it's important to keep all in mind and prioritise the solutions doing a lot of good, right now, at little cost.