Closing the Gaps: Financial Services Needs o Next-Generation Companies
1 Preace3 Executive Summary5 Section I: Next-GenerationCompanies9 Section II: Financial Services Needso Next-Generation Companies13 Section III: Financial Services Gapsand Issues Faced by Next-GenerationCompanies16 Section IV: Collaboration to Closethe Gaps18 Conclusion
Across the globe, a new breed o young, innovative and rapidlyexpanding companies is emerging. These “next-generation companies”(NGCs) are distinguished by market-leading growth, non-legacybusiness models and ootprints that extend rapidly beyond homemarkets. As new enterprises, they have invigorated the metabolism o regional and global business, with pioneering products, streamlinedservices and interactive platorms. NGCs oten bring needed productsand services to unserved markets, and oster new knowledge andcapabilities among players in their sectors. At the same time, theyare little understood, and oten underserved, by the inancial servicesindustry. Today, these dynamic enterprises orm a burgeoning marketor inancial products and services that is waiting to be ully tapped. To better understand these issues and opportunities, the WorldEconomic Forum, in collaboration with The Boston Consulting Group(BCG), undertook a study aimed at delineating:
the highlighted issues This report outlines the indings o this study. It presents the opportunityor urther analysis and collaboration, and oers initial ideas on whatvarious parties could do to get ahead o the curve to acilitate growthand reap the ull beneits o this signiicant area o opportunity.Closing the gaps between existing inancial services oerings and theneeds o high-growth companies is a priority at many World EconomicForum events. The Forum’s Annual Meeting 2013 in Davos-Klosters,Switzerland, or example, ocused on the theme o
. The meeting brought together leaders o the public and privatesectors to adopt a “risk-on” mindset to catalyse dynamic growth. The study is based on roundtable discussions conducted at severalevents o the World Economic Forum in 2012, as well as primaryresearch undertaken directly with the Forum’s community o GlobalGrowth Companies,
whose characteristics closely relect those o NGCs. The participants in the study were divided approximately50-50 between developed and rapidly developing economies. Additional research and roundtable discussions with inancial servicesproviders, regulators and policy-makers in South Arica (October2012), India (November 2012) and Indonesia (December 2012) alsocontributed to the study.
The World Economic Forum deines Global Growth Companies as those which typicallyhave: (i) consistent annual growth rates exceeding industry and regional averages by15%; (ii) minimum turnover between US$ 100 million and US$ 5 billion, depending on theindustry; (iii) demonstrated growth potential; (iv) capacity and intent to build a globalbusiness; and (v) exemplary executive leadership.