IBM Ireland’s Fergal O’Sullivan on fintechs harnessing new technologies

23 Nov 2017

Fergal O’Sullivan, head of IBM’s cloud business unit in Ireland. Image: IBM

IBM Ireland’s Fergal O’Sullivan discusses how technological developments allow fintechs to flourish.

Since taking up the role of head of IBM Ireland’s cloud unit in early 2016, Fergal O’Sullivan has had a front-seat view of cloud’s unprecedented development in the last couple of years.

Alongside the cloud computing revolution, a myriad of industries have emerged, leveraging the power of cloud and other technologies to stand out from the crowd. Fintechs in particular are reaping the benefits, and O’Sullivan spoke with about everything from AI to blockchain.

In terms of cloud itself, O’Sullivan stressed how much it has transformed: “It has absolutely evolved from a destination where you get some cheaper compute, to being embedded in all facets of life.”

He said the true power of cloud is only just emerging as the digital economy thrives. “Cloud is about deploying things very quickly in a digital economy, and now it’s more about pace, leveraging and harnessing the power from the data in the cloud, rather than just shifting workloads to the cloud.”

For businesses that want to take advantage of the cloud, efficiency and flexibility are key factors, according to O’Sullivan. “Because of the speed that cloud brings, the IT department can now be seen to foster innovation and really drive business opportunities.”

Fintech reaping the benefits

Fintechs are a perfect example of a new swathe of digital industries taking initiative on the technology front, something O’Sullivan and IBM as a whole have noticed.

“Fintechs are born leveraging the power of technology, and IBM’s heritage in in the financial services sector means we really have a deep understanding of that industry.”

He explained why IBM and fintechs collaborate successfully: “They have the really cool ideas, and we have the heritage, industry experience and the assets, such as IBM Cloud and Cognitive.”

O’Sullivan explained that IBM’s history means it can “bring that deep level of industry expertise to the table from the get-go”.

IBM Cloud and fintech innovation

O’Sullivan said that fintechs are creating some of the most disruptive financial solutions. “IBM has provided the tools, the technology [and] the training programmes to share along with the financial services expertise that we have.”

IBM’s Cloud Garage programme is one such tool, with physical locations in Dublin, London, New York and more. They serve as a hub where entrepreneurs, industry experts, designers and developers can come together and build, aided by IBM Cloud, and Cognitive and Watson APIs.

Crucially for fintechs, the Garage environment allows them to grow at speed. “We create the business environment for them to test those business ideas, but it allows them to fail fast and start again.”

Harnessing blockchain

Blockchain is the buzzword of the moment. Its applications have extended across multiple industries, but the uptake has been particularly notable among fintech firms.

O’Sullivan explained that IBM is at the forefront of blockchain in financial services, citing a June 2017 deal with seven major European banks to build and host a new trade finance platform leveraged by Hyperledger Fabric.

He added that solutions to test blockchain networks are available on a smaller scale for developers, “for example, worldwide distribution of Hyperledger Fabric on a docker hub, providing tested and certified images on said Hyperledger Fabric of their choice, included on their laptop, or on one of our public or private clouds”.

Artificial intelligence such as IBM Watson will be a key factor in the development of future fintechs, said O’Sullivan.

Over the past year, IBM’s partnership with Topcoder has created a thriving cognitive developer community, which is “looking for ways to harness Watson to create the next generation of artificially intelligent APIs and solutions”.

How are traditional services adapting?

O’Sullivan noted that legacy banks tend to be some of the biggest spenders in technology, a lot of which is down to the heavily regulated nature of the industry.

“They have to revamp their front office for the digital native who wants to do anything, any time, and they are having to do that in a highly regulated environment, unlike retail for example.”

So, what does the road ahead look like for traditional financial services providers? “There’s a big challenge out there for banks. First off, you’ve got non-traditional banks entering into the banking space as fintech,” he said.

“They might be coming from the retail space, and now they are dabbling in banking and they don’t have legacy overhead of in-house applications that have been heavily modified over the years.”

He added that cloud adoption is something all banks should be striving to achieve. “The banks are being forced to adopt a hybrid cloud model off/on premises to realise their digital ambitions at a pace, while complying with protocols.”

Fintech in Ireland

Ireland is a “serious tech hub”, according O’Sullivan, and IBM is always looking for those with the best skills. “Everyone is competing for the same skills whether you are in fintech or not.”

For fintechs in particular, he stressed the need for firms in Ireland to consider if they are leveraging the right skillsets as well as the right technology stacks.

He added that Ireland’s strong collaborative ethos makes us attractive to fintechs as well as the support of IDA Ireland and Enterprise Ireland.

This combination is, in O’Sullivan’s view, “creating an environment for the fintechs to flourish”.

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects