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Simon Dixon, Co-Founder, CEO and Author of 'Bank to the Future', Global Top Innovation Leader and Entrepreneur

This week, Stephen Ibaraki has an exclusive interview with Simon Dixon.

Simon DixonSimon Dixon was originally trained as an economist before starting his career in investment banking. In his career he was originally a trader before moving into corporate finance where he helped venture capitalists exit their companies onto the London Stock Exchange. Having worked with venture capitalists and helped companies go public, raised angel finance for his first business, helped businesses raise alternative finance, written two books on the future of banking, Simon Dixon had the passion to work with entrepreneurs and do something a bit disruptive in the banking sector.

To listen to the interview, click on this MP3 file link

The latest blog on the interview can be found in the IT Managers Connection (IMC) forum where you can provide your comments in an interactive dialogue.


Interview Time Index (MM:SS) and Topic

:00:26: Can you profile your prior top roles and useful lessons from those roles?
"....As I came out of university, there was nothing more that I wanted to do than to work in investment banking or finance and the problem was that I couldn't get a job. I still remember that I got 96 rejection letters from all the different investment banks and financial institutions that I was applying to at the time. I remember my career advisor telling me that I wasn’t educated enough so I went into the business of economics and got rejected by 125 of them. After that I changed my approach....I was a stockbroker and after six months I was a trader as a market maker for an investment bank on the London Stock Exchange. After two years I was a corporate financier working with Venture Capitalists that wanted to take their investment company public on the stock exchange....After a short career in corporate finance I quit my job and set up a qualification company for an investment banker, and after about a year I was fortunate enough to get angel funded by a billionaire in the UK called Peter Hargreaves and therein began my whole education in the world of business and finance. I wrote a book on the future of banking called, 'Bank to the Future' and I was discussing topics like Bitcoin, crowdfunding and alternative finance (as the crisis got worse it became more topical). I set up a crowdfunding company called I guess the common theme has always been around investing and raising finance (businesses whether public offering, venture capital, angel investing or setting up businesses or crowdfunding). I was lucky enough to figure out my focus in life, but I just didn't know exactly what it looked like. I've now arrived at the place where I'm a Director of the UK Crowdfunding Association and the UK Digital Currency Association working with alternative finance...."

:03:51: You are definitely an innovation leader in the finance area and recognized as such globally. You are also a best-selling author, so from that perspective what do you see as the future of banking?
"....In my book I discussed three things that need to be reformed and three changes. The first is when you deposit your money with a bank they become the legal owner of your money. When they become the legal owner of your money, they spend it and allocate it as they wish through how they issue loans and what happens with that. That needs to be reformed....Another reform I discussed is that banking needs to be split up from large banks into lots of local banks with local knowledge....Another is the stimulation of what I call ideological-based finance. Ideological is like crowdfunding where essentially a group of people get together with a shared ideology intent to meet online and fund each other and the importance of that is that there is no financial institution in the middle....Once you have these three changes of top-down reforms of the banking system (which has come about by a crisis that needs fixing): bottom-up innovation (entrepreneurs creating digital currencies like Bitcoin which is banking how it's meant to be and how it can be today), more localized banking rather than large banking, demerges and then the de-institutionalization and disintermediation of finance through crowdfunding, peer to peer lending and various other inventions that are coming today, you finally have sustainable finance...I'm very positive about the future, but we need to recognize our problems and we need to fix them...."

:08:20: How did your past experiences lead to your work with funding and crowdfunding?
"....As both an entrepreneur and in my corporate career I've always been involved in raising finance, and finance in its simplest form is very simple....Everything I've been involved with is creating products (in the corporate finance career or the trading career) that redistribute or allocate money towards different means. When I've been in business I've been in scenarios where I've needed access to capital and found it very hard to get hold of. In other times I've been in scenarios where I've got excess capital and I'd like to invest it and get a return on it....When I saw crowdfunding emerge I thought that finally the technology and the environment have reached a place where we can actually allocate resources without necessarily having a financial institution sitting in the middle that has more of that profit than the mission of what's actually being funded in the case of the business...."

:10:12: Please overview '' and why people should get involved?
" is essentially a platform where entrepreneurs and businesses can pitch their businesses to other people and investors can get involved at different levels. Whether that be the small investment of 10£ to a larger investment of 100,000£, it's all-inclusive to everybody so the major part of (the original vision) was to democratize investing which has some challenges in terms of regulations and also encourage financial inclusion whereby people can start diversifying and build a portfolio and companies and doing that with as little of 10£, 100£, or 1000£ in the case of the UK...."

:11:58: The marketplace is still relatively new in terms of your platform BankToTheFuture, but there are some platforms in other countries. How would you differentiate yourself from the others?
"....There are different models of crowdfunding. I heard Kickstarter had an amazing reward-based crowdfunding by which people offered their products to people and people donate and if the sum is reached they get it....There is also equity crowdfunding....You also have what's called debt-based crowdfunding which is lending money to businesses and you can receive interest on your money even by starting small and diversifying across lots of businesses....What we do at is we've spent years working on how to integrate those three models into one product. People offer rewards or they can invest either equity or later debt and investors can diversify and invest in different ways and businesses can get good support to pitch their businesses in a good way. This is the kind of way we distinguish ourselves at the moment and we've got some very ambitious plans for the future...."

:14:53: What are other factors essential for your resounding success?
"....For the company, the aspirations of what we want to do I talked about earlier, about my ideology of what the future of banking should look like, BankToTheFuture is really a manifestation of the ideologies....What we want to do as we grow is take a lot of the elements of banking and put it into the new way of doing things. This isn't an overnight mission, but one step at a time building what we eventually want to be, a crowd investment bank. I'd say the reason that we differentiate ourselves is that we're a team of people that really care, on a big mission to make a difference and we've all been involved in this world of alternative finance. For us the success of alternative finance is more important than just making a large profit. We consider ourselves ideologists and missionaries, but at the same time having a group of very experienced business people with a track record of execution...."

:16:27: How will your work evolve in 5 years?
"....All I can say is that we're building a crowd investment bank and we're building it one product at a time over the coming months and years. The fundamental principle and belief that we are buying into is that in the future every single financial product, whether mortgages, insurance, whatever it may be will be de-institutionalized and based upon people funding it in a peer-to-peer crowd funded relationship....We want to be a part of the reinvention of banking from the ground up and there are several different parts to that so we’re making sure we've got divisions or investing in companies that are doing that. We want to make sure that it is integrated nicely, built from the ground up...."

:18:02: I think you've touched on this already somewhat, but do you believe that crowdfunding will then supplement traditional funding approaches or really be totally disruptive and significantly replace traditional funding approaches?
"....I think alternative finance will definitely do some disruption, but we have to remember that banks don't really like lending to business, so when a company doing alternative finance comes along and does something that lends to business that's not too bad. But when companies come along and start doing things that banks do care about like mortgages and that does through crowdfunding, that's going to be very disruptive....The most disruptive alternative financing other than crowdfunding is digital currencies which are actually the biggest invention since the internet (in my opinion). So that's extremely disruptive when you have digital currencies meeting inventions like crowdfunding and peer-to-peer lending — you have a significant problem for the future of traditional financial institutions...."

:20:12: You have one of the most flexible platforms on the planet with BankToTheFuture, so what is your global strategy? What are the challenges and what are the opportunities?
"....The technical challenges aren't that significant because we've already built our platform in a way where it can handle multi-currencies, multi different payment methods. The regulatory challenges are significant because it took us two years to create the correct regulatory environment in the UK to be able to offer shares to investors....We had to change all those rules. Each country has their own rules, their own regulatory environment. For us it's fairly easy and seamless to expand to Europe, but then you've got two different challenges. You've got businesses where you can finance and you've also got the investors and you've got different rules. For us to expand to a country like America or some countries in Asia, you'd have to take their regulatory environment one at a time, so it's significant, it's challenging, but we do have aspirations...."

:22:27: There has been a recent change within China, in August 2013, the Chinese central government launched a program for financial market openness and that program is expanding and continuing. Do you see yourself tying in or being able to leverage that in terms of your platform and can you provide your forecasts of where you feel this will lead and its implications?
"....At the moment we're focused on English speaking countries because of the rapport with the platform. Whether we expand to countries in China are not things we are exploring at the moment....But any movement towards financial openness is to be encouraged today because we're in a very changing world...."

:23:41: What are the investment (government) policy changes you want to see in your country and worldwide?
"....I don't necessarily know the answer to how this is going to happen, but there needs to be recognition that we live more in a transparent world and we also live more in a global world. In terms of changes, one of the big changes was possibly allowing opening up who could invest in private companies....The other changes that we'd quite like to see is an environment where companies can invest in other companies and receive some of the tax incentives...."

:26:15: From your extensive speaking, travels, and work, please share some stories (maybe amusing, surprising, unexpected or amazing).
"....It's very easy to think when you look at people who have achieved the things you want that it's been an easy journey, but life is a very challenging journey and it's full of failures. One of the main things that I've learned is to go out there and do the best you can and really try to achieve something, and recognize that there's going to be lots of rejection along the way and rejection is actually an instrumental part of failing your way to success....The moral of the story is that life is full of rejections, fail your way to success. Expect things to be hard, the point of life really to me is reaching a point where you are so passionate about something that the effort becomes effortless, not letting it get easy because achieving anything in life is really hard...."

:29:17: If you were conducting this interview, what questions would you ask, and then what would be your answers?
"....'How do you remain focused?'....Because there are so many setbacks in life it's often easy to get distracted by opportunity and in answer to the question, I've never actually been distracted by opportunity, I've always remained focused. One of the observations that I've made in life is that the people tend to struggle, rather than chasing passion they tend to chase opportunities (and they tend to find opportunities which are a good way to make money or a good way to do something), but what I found is that good ways to make money aren't necessarily what your path is and people don't do well at them. So rather than chasing opportunities I encourage you to chase your passion. When you chase your passion (which is what I've done) you do down a path in life where effort becomes effortless, you find where you want to fit in and that's what I encourage everyone to do, chase your passion rather than opportunities...."

:31:13: Simon, with your demanding schedule, we are indeed fortunate to have you come in to do this interview. Thank you for sharing your deep experiences with our audience.
"....Thank you for having me, I always like talking about things to help somebody else. I hope there are some gems and nuggets in that...."