Australian finance firms' push for tech cool leaves consumers to check the credentials – The Australian Financial Review


Few companies embody the culture clash under way in Australian finance as perfectly as Spaceship. 

The millennial-focused firm is not following the usual path for an Australian superannuation business. 

It has raised a stack of cash from a star-studded register of venture capital investors, including an entity controlled by billionaire Trump ally Peter Thiel and vaunted US venture firm New Enterprise Associates.

But it hasn’t all been smooth sailing. Spaceship has attracted criticism from sections of the financial services industry for launching with high fees and a low return benchmark.

Spaceship founders Paul Bennetts, Andrew Sellen, Dave Kuhn and Kaushik Sen, have raised impressive funds, based on a ...

Spaceship founders Paul Bennetts, Andrew Sellen, Dave Kuhn and Kaushik Sen, have raised impressive funds, based on a desire for exposure to tech sizzle.

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Its original CEO was replaced, and recently, in documents leaked to The Australian Financial Review, the company warned its smaller investors it would stop sharing information with them, citing leaks to the press. 

But at least some of the consternation surrounding Spaceship seems to be stemming from jealousy from rivals. In the space of a few months, the firm has amassed thousands of customers and nearly $100 million in funds under management, which is no small feat. 

It has achieved this largely through aggressive (and effective) marketing, including campaigns, prominently featuring Atlassian co-founder Mike Cannon-Brookes on social media.

Spaceship has positioned itself as a technology company – it is promising members a greater weighting to tech stocks, exposure to start-up investments, and it also wants to build a better online experience for its users – so it has credentials to support this. 

But to its rivals, it is just another superannuation firm, with higher fees and cooler marketing, so this is grating for them.

However, Spaceship is not alone in pursuing this tech-focused approach. 

Take Magellan Financial Group, the $40 billion listed funds management powerhouse, and one of Australia’s great financial services exports of recent years. 

Magellan and its CEO Hamish Douglass (who has reportedly taken to dressing up as Steve Jobs in presentations with financial planners) have really taken to the tech theme lately. He has been talking up Magellan’s tech holdings, such as Apple, and the themes it is positioning for, such as the rise of artificial intelligence. 

It hasn’t all been blind cheerleading from Magellan. Last month Douglass declared Uber was a ponzi scheme, describing the ride-hailing giant as “one of the stupidest businesses in history”. He argued that self-driving cars will destroy its business model, and put the odds of its survival at just 1 per cent. 

Douglass was in some ways articulating what many in the technology and venture capital industries have been quietly thinking, but too timid to say. Back in February, I argued the company’s well documented cultural problems could ultimately expose flaws in its business model.

Regardless, Magellan’s big call on Uber had the desired effect: acres of coverage in the press.

Financial services companies are obsessed with technology right now, because it is proving to be a powerful marketing tool for them. 

Giant bank ANZ recently made a lot of noise about the fact it was adopting the “scaled agile” framework to run its business. Nice try guys. You’re still a giant bank. Even staid accounting firms are talking up their tech bona fides. 

But this reflects a bigger theme. Software is eating the world, and technology is now just business.  The balance of power in most western economies is shifting away from finance to technology, consumers and customers just need to train themselves to spot the difference between the steak and the sizzle.



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