The finance industry has historically gone hand-in-hand with MBA degrees. Even as MBAs are becoming increasingly popular in other industries, finance is still the biggest MBA job sector and accounts for 22 percent of all MBA jobs, according to the 2014/15 QS TopMBA.com ‘Jobs and Salary Trends Report.’
While finance has always been a prominent staple of business school, it’s also been a bit of an “old-school” science. In recent years, the role of technology in business increased dramatically as computers, big data and business analysts have entered the arena. These developments have opened up new sectors and industries including FinTech.
What is FinTech? As we outlined in a previous post, FinTech, also known as Financial Technology, is an industry made up of companies that use new technology and innovation to to best compete in the marketplace of traditional financial institutions. Basically, FinTech is “innovation in financial services” and is mainly composed of startups and established financial and technology companies looking to enhance or replace traditional financial services.
Most consumers are aware of the original FinTech company — PayPal. When Silicon Valley visionaries like Peter Thiel and Elon Musk founded the service in 1998, they drastically changed how services were paid for online, as well as creating an alternative to traditional banking.
Today, new apps and services like Venmo (a PayPal subsidiary) are a popular way to pay utilities, split rent, or lend money and crowd-funding sites such as GoFundMe and CrowdRise are finding launch small businesses faster than ever.
Other examples of companies and concepts that are central to FinTech include cryptocurrencies and the blockchain, digital advisory and trading systems, artificial intelligence and machine learning, peer-to-peer lending, equity crowdfunding and mobile payment systems.
Now, we won’t jump the gun and say that the FinTech industry is posing a huge threat to banks like Bank of Americas and JPMorgan Chase, but MBAs may want to start looking into FinTech jobs just as they would look into a position at one of the bigger financial institutions. In order to best prepare their students for these new jobs, business schools are starting to offer specialized FinTech MBA degrees.
One such school is New York University Stern School of Business. Founded in 1900 as the School of Commerce, Finance and Accounting, Stern was was renamed in 1988 in honor of a $30 million dollar gift from Mr. Stern, who received both his undergraduate and MBA degrees from NYU. Today, the school offers full-time, part-time and executive MBA degrees. Students in the full-time track can select FinTech as a specialized area of interest.
Stern was the first school to include FinTech as an MBA specialization, launching the concentration in fall 2016. The school recommends the FinTech Specialization for prospective MBAs who want to break into investment banking, international finance, social entrepreneurship, sales and trading, IT and product management.
“Technology continues to transform the business landscape at a breathtaking pace,” said Raghu Sundaram, Vice Dean of MBA Programs and Online Learning, in a press release following the announcement of the new specialization. “Business education needs to innovate to keep pace with the rapid rate of change. The launching of the FinTech specialization, a joint creation of our Finance and Information, Operations and Management Sciences (IOMS) departments, is an important step in this direction.”
Stern’s FinTech courses subjects such as trading strategies; transaction security, and trade clearing and settlement; data management; risk management; financial data analytics; regulation and the impact of digital currencies on the financial services industry; mobile payments and entrepreneurial crowdfunding.
The school also recently hosted the inaugural FinTech Conference for researchers, business practitioners, alumni and students to debate and discuss the future of FinTech. Expert conference participants and panelists included NYU Stern Professors of Finance David Yermack and Thomas Philippon; Ken Kroner, Retired Senior Managing Director, BlackRock; and Dan Schulman, NYU Stern MBA ’86, CEO, PayPal. The conference also featured moderated industry panels on online investing vs. venture capital, and beyond blockchain, by NYU Stern Professors Anindya Ghose and Arun Sundararajan.
As the FinTech industry continues to grow and evolve, expect NYU Stern’s specialization to change with it and help bring on the next generation of innovators.
“The emergence of FinTech demonstrates how powerful the intersection of disciplines can be to drive innovation,” Peter Henry, Dean of NYU Stern, said in a press release. “This collaboration of thought leadership among our faculty gave rise to our new specialization, and the approach can empower all of our students in their pursuits to solve problems and create value in any sector.”