AAAccell: Unleashing FinTech’s Real Potential




"When I look at the difference how money was managed 25 years ago, there is barely any change, unless some new sort of products. But the methods, systems, processes, quality, price, accessibility, etc. remains more or less the same. On the other hand, there are great solutions at hand, developed by researcher and IT companies such as we are, who truly can make a difference by offering more compelling solutions for customers, which by the way will drastically expect more in the near future since the baby boomers or other generations will take over the wealth. We aspire a future where clients have an attractive risk/return ratio in their portfolios with a sophisticated and far-reaching 24/7 service at their fingertip", espouses Sandro Schmid, Co-Founder, and CEO of AAAccell that stands for Academic excellence, Artificial intelligence, and Algorithmic power.

AAAccell is a leading Swiss quantitative FinTech in Risk and Asset Management that develops innovative AI/ML solutions for the financial service industry. The company's innovative solutions are based on the latest scientific results and methods, developed by leading academics, professors and researchers from various universities such as ETH, University of Zurich or Columbia NY. Their team is composed of two former bank CEO’s, more than 11 professors, and highly skilled developers and quants. Together with three professors on the board of directors covering mathematics/quant finance, econometrics, and optimization. The advisory board is composed of seven professors and chaired by another former bank CEO. "We all focus to develop pioneering solutions so our customer gain value in their service offering. We share the common goal to truly make an impact in the market with our solutions and to contribute that the FS market will become more stable and secure", says Schmid. AAAccell offers its services through API’s but deploys some of the services through their developed platforms and through platforms in the space of Wealth Management, AI FX Hedging, robo advisory, infrastructure provision or pension funds.

Since 2014, the company has grown tremendously with two offices in Zurich, one office in Korea as well as has a presence in New York, London, and Rumania. AAAccell's quant-solutions help financial institutions, banks, insurances including CS, SwissRe, SIX, EFG, Pension fund, several FinTechs, and asset managers like UBS, Zurich or Rothschild to stay ahead of their competition.

AAAccell develops innovative AI/ML solutions for the financial service industry

An Innovation Think-Tank

One of the AAAccell's latest cutting-edge quantitative innovation is a very attractive EU real-estate fund which was recently launched. The bank Rothschild/Orox inspired a solution that was yet not developed in the market. AAAccell took the challenge of tackling the problem through close collaboration, out-of-the-box thinking, and acceptance of an iterative development approach based on research-based methods. The result: The difference to traditional funds is that users can analyze a systematically large amount of data about real estate prices, financial markets, economic information and use different AI/ML-based methods for predictive algorithms."I am always thrilled to see what we can achieve if our diverse team with different skills align their thinking on one problem. In this regard, I think we are quite unique due to our in-depth and broad knowledge using different technologies and methods from numerous fields", cheers Schmid. The ability to delivers each time unparalleled outcome has landed AAAccell at the forefront of setting standards in risk- and return management.

AAAccell is (inter)nationally awarded and recognized among others as a Top 10 AI Google company, Top 5 European & Swiss FinTech, a global Top 100 RegTech, stood Winner at KOREA Grand Challenge 2018, Winner Swisscom Challenge 2018, Winner Swiss FinTech Venture Leaders 2018 (New York) , Winner at Digital Switzerland (Kickstart Accelerator) 2017, out of more than 1,500 companies worldwide, named Top 5 European FinTech 2018 in Portfolio Management, Top50 Swiss Startup to invest in 2018 (Bilan), and is a distinguished member of the Swiss Economic Forum “SEF High-Potential SME” quality label (2018), and so forth.

Undoubtedly, AAAccell is one of the hottest fintech firms that is committed to delivering world class algorithms to change the financial market and drive disruptive optimization.

Blazing the Trail

AAAccell is lead by Dr. Walter Farkas, Co-founder and Head Risk Management, Board President and Sandro Schmid, Co-founder, CEO and Board Member.

Sandro Schmid is also heading the Swiss Risk Association as Co-president, which is an NPO founded in 2013 at the ETH Zurich. He is very close to academia and has been working as a lecturer for over 10 years at the University of Zurich among other institutions. Prior, he worked as one of the youngest bank managers to sever for a large universal bank and was nominated later as CEO, COO, and CRO for different banks. Besides his banking experience, he has worked for about 10 years in Advisory and became a Big4 Partner, leading the risk and performance advisory team.

Sandro Schimd, Co-Founder and CEO

For Schmid, working in the field finance is one of his greatest passions. He likes the industry due to its complexity, its economic importance, the fast-changing environment and the impact it may have on individuals. "I think the core idea of FinTech is to support the required innovation in Finance. Many services are still offered like it was 25 years ago. Further, most banks are still not scalable and suffer under FTE and IT costs. FinTech, among others, are environments where institutions might find some attractive solutions", says Schmid. Fintech is hard and it is not just about servicing the client. There is a lot of regulation, risks, and complexity. Maybe it is for this reason why Schmid explains, many FinTechs just offer very simple solutions which would not replace the finance industry. "I think majority went into rather non-complex business, such as payments for small amounts. I can meanwhile transfer almost for free money globally instantaneously and see it conveniently on my mobile. But would someone transfer e.g. USD 1 million over such a platform? Presumably not..... Further, I think traditional banks are sometimes underestimated by some Challengers. Of course, old banks have several legacies such as very old IT environment or low acceptance of changes but on the other hand, they have a lot of experience, data, methods, and processes how to run this business over decades. e.g. most peer-to-peer platforms has no capital or other protection for their clients. Therefore, retail clients investing into such platforms will presumably be hit hard in the next economic down circle since these platforms are in my view less accurate in measuring the different risks, take on loans which banks declined due to the inherent risks and they have no skin in the game like banks ( equity). I expect that regulators will soon intervene on such business models before again small investors pay the bill, e.g. by extending the MIFID regulation into such platforms", elucidates Schmid.

But Schmid has a plan to win: Disruption."I see endless opportunities in the FS market. The current asset management market has barely changed in the last 20 years but today, there is so much technological and methodological progress at hand which truly can make a difference for the clients, and the advisory/relationship manager", shares Schmid. Indeed there are great opportunities, huge potentials and steep obstacles to overcome. But if fintech entrepreneurs could maneuver through these challenges, the rewards would be brilliant. Industry leaders should thus have a deep understanding of the market. "They should have the ability to forecast client behavior and client demand; should be tech affine- understand possibilities and constraints of new technology, embrace it but with a certain degree of skeptics; and quant affine (e.g. machine learning etc.) to understand the power of modern quantitative possibilities. Especially in Finance, since all is about numbers. There is no taste, no design, no smell, just numbers", elaborates Schmid. But never forget, he adds, " corpore mens sana! One must make sure to perform and not just for 5+ years. So physical and mental health is important". Though it is not always easy to really disconnect, Schmid always spares time to be with his family and engage in recreation through different sports and vacations.

But who will win? The battle between fintechs and legacy financial services institutions will continue in this space. Schmid chuckles and says, "There is this saying that the economy doesn’t need banks, it needs banking. I always struggled with this statement because if you want to offer banking services as a non-bank, regulators will knock at the door and request the banking license. If any FinTech wants to truly offer banking services, a banking license and its regulatory framework will impose (for good) massive change to the business model and a FinTech must be to a certain extent managed like a bank e.g. on governance or capital- and risk management. I don’t think regulators will relax on those important regulations since the importance of banks or alike in the economy is too big. Hence, if there is a FS market in the future, there will be pure FinTechs, pure banks and some sort of combination of both".

Future Horizons

For now, the company will increase scalability, enhance quality and will speed up its global footprint with their focus on the US and UK market as well as Asia. "I expect that the market will change a lot in the next 10 years. Contributing to this large change in one of the most important industry is definitely very exciting". So far, that contribution is paying off.

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