Scaling Risk Management for Success

Rudy Rouhana

INTRODUCTION

In this chapter, the author will examine risk management within the context of emerging companies in the financial-technology sector, otherwise known as fintech. These companies continue to receive an abundance of interest from investors globally, with total investment in 2016 growing nearly 11% to over US$17 billion.¹¹https://medium.com/@InnFin/global-vc-investment-in-fintech-up-10-9-7d672052c724 However, venture investment is inherently focused on innovation and growth, which can put risk and compliance functions at odds with a fast-paced organisation that perceives these functions as cost centres that inhibit the pace of development. To understand how to respond to this common dilemma, four topics will be detailed:

1. the emergence of fintech: the factors that drove innovation away from established financial intuitions and into the hands of entrepreneurs;
2. risk management needed on Day One: the consequences experienced by three prominent fintech companies that eschewed risk and compliance programmes early in their lifecycle;
3. making the case for risk and compliance in the C-suite: the need for specialised professionals in senior leadership