The relationship between big banks and scrappy fintechs is often described as antagonistic. The former are seen as deep-pocketed but slow-moving; the latter lean but sometimes rash. Yet, despite dogged competition between them—from app stores to courtrooms—banks and fintechs have much to learn from each other. 

In an interview with The Financial Revolutionist, James Jack, Head of the Business Owners Client Segment at UBS, suggests ways fintechs can learn from the experiences and strengths of banks like UBS. From differences between product- and advice-driven businesses, to exit strategies for founders, Jack offers a comprehensive, long-term roadmap for both fintech and non-fintech entrepreneurs. 

This interview has been edited for length and clarity.

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The Financial Revolutionist: How long have you been at UBS?

James Jack: I've been with UBS my entire career—it will be 17 years in June. I’m the Head of our Business Owners Client Segment, which I have run since its inception a bit over four years ago. Prior to that, I was a product developer in UBS’s lending and banking organization and in global wealth management. The current group I head is meant to support our financial advisors and their business owner and entrepreneur clients as they build, grow, and ultimately exit their businesses. 

Given that you've been in the group since its inception, what was your vision for steering it at that starting point? 

When we started this, we were looking at our client base, and we were looking at where UBS was growing and where wealth was growing. We saw that a significant amount of it came from business owners, particularly baby boomers, who were at a point in their lives where they were ready to transition their business—whether to their children, or more likely to a third party like a strategic buyer or private equity buyer. We started out with that baseline and ultimately said, “You know, we need to do a better job serving this client base.” 

There’s so much at stake for an exit particularly; a lot of these people have spent possibly decades building these businesses, and so you only really get one shot. I'd say exiting a business is possibly the most significant financial event of a business owner’s life, up there with marriage and children. We hope to create better outcomes, whether it's maximizing the value of their business or maximizing the net proceeds that they get from that sale for the people and the causes they care about: doing so with estate planning and wealth planning ideas.

How have those visions played out over the past four years?

I’ll give one proof point. We attended the Exit Planning Institute’s conference this week. They’re an organization running the CEPA (Certified Exit Planning Advisor) designation, and we're the lead sponsor of it. When we started this work, there were a handful of UBS advisors who had gotten the CEPA. When I came on board, we made it an official designation that we would approve, and since then, there are a few hundred advisors at UBS with the designation. 

The industry has really accepted the idea of exit planning and business owner advisory, and UBS was recognized at this conference many times as the first mover in that. So that's how I'd say we're seeing it, but we're seeing it also with what we're doing with our advisors and how they're talking more to business owners internally.

What external partners support this work?

The Planning Institute is certainly one. But also, on a day-to-day basis it's the other advisors that work with business owners and entrepreneurs, it's CPAs and attorneys. It's those people locally that our financial advisors have built relationships with that are key partners. We have a boutique investment banking network—so, in addition to our own global investment bank, we have a network of 20 or so different investment banks across different sizes and industries, so that we can help more clients with that. We’re building these kinds of organizations internally and externally and locally at the advisor level to support business owners throughout the planning of their transition.

Why do you think UBS was the first to look specifically at this business-owner demographic?

I wouldn’t say that we were the first to look at business owners as a demographic, because wealth managers and banks have been working with business owners for many, many years. I think where we’re a leader is that we knew we could do more than wait for a business owner to have their exit and then talk to them. We’re a leader in terms of educating our financial advisors to create great content and thought leadership for both our financial advisors and for our clients, and doing events and working with outside organizations. 

In terms of why UBS was maybe a first mover in it, I think it just comes from that we’re very focused on our clients. That's what UBS is all about, and I think what we were seeing is, it's one thing to segment people based on what they do with UBS, you know, how many assets they have, and what products they are. But also, it's another thing to think about how they are. 

Something that sticks out in your description of this work is that so much of it is relationship- and information-driven, rather than about building new things. To make a generalization, fintechs tend to gravitate toward building new products rather than new ways of relating. Could you talk about why person-to-person contact, while perhaps slightly less scalable, is what you see as the most successful business model here?

I think human-to-human contact in this type of advice business is important, because there's a lot of self-identity ramifications for business owners. Certainly someone can go Google and get some information there or use some sort of automated service. But here, not only do business owners only have one shot, and might have some worries about what it might mean, you want to talk to someone: You want to get other people's experience.

And I think, for your readers, particularly on the fintech side, as they're building their businesses, you know, certainly they can build products for business owners. But then themselves, they are the core demographic of what we're talking about here. And many of them are likely building a great business and potentially seeking venture capital or friends and family funding, and ultimately gearing up for a raise. 

What I’d say is to begin with the end in mind: Recognize that eventually, there's going to be an exit, whether it's in a few months or in many years. Really thinking about that ahead of time is going to be critical for your readership. Once they're going a mile a minute, and then suddenly a great opportunity comes or potentially something bad happens, and they have to do a disposition, you really want to be prepared ahead. And that's where our financial advisors are part of it.

Are there particular steps within that process The FR’s readership should know about?

Early on, think about how there will eventually be a transition. What do you need to set yourself up? Are there personal financial planning or legal documents in place? Have you tracked everything appropriately in terms of where you want to go and where your employees want to go?

Think through that with the end in mind, even though you're hyper-focused on building your business, and then have a regular-interval—maybe once a year—exit talk with your board so that it's not taboo, but instead a regular theme. That creates a kind of smoothing effect and allows for the entrepreneur to be thoughtful about it, and be intentional about what they want to do with themselves and their business.