Juwan Lee, the energetic founder of NexChange, an exclusive network for financial professionals, like any Fintech CEO, spends a lot of his time on the road. The entrepreneur splits his time between Hong Kong, New York, and London.
The network, which is available both on desktop and smartphones, brings together industry peers on a social and professional level, and at the same time integrates events, news, data, and chartrs.
Lee wore many hats before he decided to leave the finance industry after 30 years to bring his own product to the market. Before NexChange, he was the International Chief Investment Officer of Shanghai’s largest asset manager. He spent numerous years at JP Morgan in various roles from Head of Equity within the asset management division to principal investing, and managed portfolios on behalf of SAC Capital. Growing up in the US, Lee studied engineering at Berkeley, but opted for finance after graduation, joining Bank of America’s Capital Markets/Global Banking team.
For the better part of the last decade, Lee has called Hong Kong home. Although NexChange has its headquarters in New York, Hong Kong plays an important role. The company works closely with professors and experts from the University of Hong Kong Computer Science Department, including Dr. Francis Lau, who advises the company on technology architecture. NexChange also sources talent for its tech team from the university.
FinBuzz talked with Mr. Lee to learn more about an application that has a potential market of 50-75 million finance professionals.
1.What does the name stand for?
NexChange means the next evolution of change connecting the financial service industry worldwide.
2. How did you come up with the idea and how it was executed?
After leaving the financial services industry two years ago, I discovered there wasn’t a social network connecting the entire industry. A place where participants within every subsector of financial services could connect, get specific content, communicate and develop their careers. I assembled a few initial people to create a prototype and presented to the Associate Dean of University of Hong Kong Computer Science department. He was truly excited by the idea and became a supporter and an advisor. Since then, the growth was quite rapid. We have a team spread across the main money centers with our headquarters in New York, London and Hong Kong locations.
3. How big is the potential for finservices to disrupt the industry that has so long been dominated by meetings, checkbooks, and computers?
We believe 2015 was the year that major financial institutions started to believe that small startups could potentially change the landscape of the financial services industry. 2015 was also the year that Millennials outnumbered Baby Boomers and Gen Xers. This group is much more open to social media, disruption and not tied to the traditional financial services heritage. An important part of the disruption comes from the capital that is being raised for fintech and finserv companies. In 2013, there was approximately $3 billion raised to over $12 billion in 2014. It is projected that crowd funding may even surpass VC funding by 2016. There is a combination of support from the change in demographics and the capital to help this evolution.
4. How much capital has NexChange raised?
We are finishing up a round of investment and are weeks away from closing a seed round. After that, we will be able to disclose this information. We recently launched our mobile app and will provide a PC platform in the near future. We have developed numerous partners over the last year. We were able to drive revenue from the first day our product launched.
5. Can just anyone join the social network?
We don’t screen, in that we don’t verify that you are financial professional or not. There is an important criterion on successful social networks. They all have three things in common: they go after mass, they have engagement, they don’t have screening, it’s not private, it’s public. Self-vetting is important.
6. What about other social networks such as Bloomberg, and now Symphony?
Those are both enterprise, they are b2b, which serves a much smaller number of people. There are 325,000 Bloomberg terminals, but we are going after the 50-75 million people that are in financial services. We aren’t limited to just Wall Street, financial traders and portfolio managers. We are open to a much bigger market.
7. What are some other fintech companies you admire, and why?
Rather than focus on companies we admire, we believe it’s best to focus on what areas within fintech that are exciting. We are excited about Blockchain. Because it is a decentralized digital ledger, no one group has control over the other.
We are also excited about cybersecurity within financial services. Cyber attacks are in the news practically every day. And as these attacks are increasing in frequency and complexity. Financial organizations have to stay ahead of the curve and have topped the list of attackers’ target.
8. Do you see NexChange continuing as an independent platform, or anticipate a merger with a larger financial institution?
I think the best way to describe it is that we are an independent network, this is why NexChange has been noticed, because we are independent.
9. Do you think banks will adapt to this [fintech] trend with their own products, or be left behind in the dust?
There is so much talk about banks being disrupted, but it will be more like an evolution. We already see a significant number of banks involved in creating startup accelerators which we believe is a hedge. Although, we see these programs supporting to grow the finserv and fintech ecosystem, one of the main reasons for accelerators is for banks to have one foot in door of the technology that can compete with them in the future. This will help prepare the banks to provide their own products or partner up with organizations where it makes sense. In areas where it does not make sense, then banks could lose out to smaller fintech companies.
10. Who are your direct competitors, and what makes NexChange stand apart?
We don’t really see direct competitors for all facets of our business, but individual threats within different services we provide such as competitors in social networking from general to niche social network competing against mindshare, to financial news-oriented publications competing against our content and financial career focused job listings. We stand apart because we provide a vertical social network that has all of these components under one roof and ability to customize feeds for specific needs of our user.