UBS asked its millennial workers to disrupt its investment bank - here's some of the tech ideas they came up with
- UBS held an innovation competition last week for junior bankers in its investment-banking division.
- Five groups of finalists gave their pitches to a panel of judges made up of senior bankers.
- The winning team, known as Dal.ia, proposed using artificial intelligence techniques to automate some of the job's more mundane tasks, such as building financials models and creating term sheets.
In a 14th floor dining room at UBS's New York headquarters last Friday, five teams of 20-something bankers readied their pitch.
They weren't presenting an idea for a takeover, or even trying to win the right to manage some institution's wealth, but rather competing for a chance to bring some fresh technology ideas to UBS's investment-banking division.The five teams had been selected from a field of 11 that submitted ideas for the division's first-ever innovation competition. In all, more than 30 of the division's junior bankers participated, according to Sam Kendall, who runs Americas investment banking at UBS and served as one of the judges.
Events like these are taking place across Wall Street as firms look for ways to engage younger workers and source good ideas for bringing technology deeper into investment banking. All of the groups targeted "pain points," such as the mundane and often rote tasks on which junior bankers spend much of their days. These include building financial models, creating pitch books or filling out standard documents.
"The knowledge is at the edge of these organizations and you have to create forums like this to hear it," said Kendall, who has also introduced pizza lunches and created a lending library on a shelf outside his office to help foster communication and outside-the-box thinking since taking over in March.
The assembled judges included Kendall; Damian Krauze, his COO; Bethany Ropa, a real-estate investment banker; Lauren Surzyn, a banker in UBS's data solutions distribution and data sourcing business; and Vik Hebatpuria, global head of fintech investment banking.
Other senior leaders also attended included Robert Karofsky, newly named co-head of the unit that includes investment banking and sales and trading, and investment-banking chair Ros Stephenson.The master of ceremonies for Friday's event was Barry Hurewitz, the COO of the research division and one of the creators behind the firm's Evidence Lab product. In his introduction, Hurewitz offered his own advice for coming up with the next big thing: start small, organize the exercise so its failure isn't catastrophic, gather data, establish data-driven feedback loops to make the product better, and then grow from there.
The teams gave it a try. They got seven minutes to present, and five minutes to answer questions from the judges. Each had a slick PowerPoint presentation to aid their remarks, and they all tried to answer common questions: What was the addressable problem? How did their solution solve it? What were the costs of the project, both direct and indirect? How long was the implementation timeline?
Timelines and cost projections among the groups were a little erratic, with some getting closer to the likely mark than others, though the judges pledged to look through such shortcomings. In the end, UBS is likely to implement elements of each solution, Kendall said.
But by the end, there could only be one winner: the group that proposed using artificial intelligence to help automate some of the more mundane tasks of investing banking.
Their solution, a family of applications with the promise and power to develop term sheets, would create PowerPoint presentations or financial models, and eventually, write entire documents. The team had help from Ronald Jansen, head of UBS's Data and Analytics Lab, who joined earlier this year after 13 years running a team of quants at Goldman Sachs.
The winning team gets more time and money to work on the project, and an additional year-end bonus.The runner up, a group proposing a mobile app for communicating investor orders to clients selling equity or debt into the market, fell to No. 2 in large part because another group in UBS was already working on a similar project. Other groups proposals included a front-end dashboard for UBS's customer relationship management software, a predictive calendar for planning corporate meetings at upcoming conferences and an idea for tablets to replace physical pitch books.
To be sure, other Wall Street firms are already building some of the projects that these junior bankers are proposing. Goldman has begun automating the IPO process, other banks have book-build apps and machine learning is a hot trend across the industry.
But more than anything, the competition was a place where junior bankers could have their voices heard, get access to senior management, and enjoy a chance to think creatively, if even for just a couple hours of the day.
"If we can release time from bankers to just think, sit there with a blank sheet of paper to think about their clients' problems," Kendall said, "then maybe we'll move the ball forward a little bit."