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Artificial Intelligence (AI) will truly make its way into the Big Banks through acquisitions. It is no secret that all financial institutions aim to maximize profits and minimize risk, and Big Banks are no exception. Their hesitation to dive into the world of AI can be compared to the caution of a gold lender in the days of Babylon: "Better a little caution than a great regret" (George S. Clason, The Richest Man in Babylon). They are willing to lend money to FinTech startups to take the risks, thereby mitigating their losses should the endeavor not prosper.
When those investments do turn profitable, we will see complete buyouts, similar to what happened when BNP Paribas took a majority stake in Gambit via BNP Paribas Asset Management in 2017 during a fundraising round, before acquiring all of its shares in 2021. The world, and Big Banks in particular, are watching and waiting to see how far AI will go, but make no mistake—AI is here, and expectations are high.
As with all industries in their infancy, we will see many players come to market, but not necessarily the first to arrive will thrive. Many companies have entered markets with a product, only for competitors to come later with a better mousetrap and seize the market. History has also shown us that jumping into an emerging technology prematurely can have adverse consequences, as many corporations experienced with the Metaverse. Big Banks are patiently waiting for more players to enter the market and will strike when the opportunity arises to acquire FinTech firms with the technology to better serve their clients on a large scale.
This will take time, but in the present, the opportunity for small AI startups has never been better. We will all benefit in the future because of them. Just like the days of the Gold Rush, not all will succeed or find their fortune, but those who strike gold in AI should know that Big Banks and corporations will gladly reward them as handsomely as mining companies did for landowners. The gold is still in the ground, just as the problems are still there to be solved. For those of us willing to learn how to use AI as a tool, the chance of striking gold is far greater.
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