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Private banks are spurring innovation, but how do their efforts stack up in the eyes of Silicon Valley's powerful investors? finews.com asks Shruti Gandhi, founder of Array Venture Capital.

Shruti Gandhi, how is the wealth management industry here in Switzerland dealing with «deep tech»?

My general finding is that companies want to use deep technologies such as artificial intelligence and machine learning although they do not have a clear value proposition in mind. A good value proposition is when a company can use these technologies to increase their top line, bring efficiencies, increase workforce productivity, and so on.

Why not?

Companies do not want take a risk and fail. Failure isn’t part of the culture. At the end of the day, unless its certain and well-packaged for them, they’re not willing to be an early adopter of that technology.

That doesn’t bode well for the wealth management industry to keep big tech from eating their lunch. 

The wealth management industry needs to be high-touch with a good, personalized experience, with low costs at the same time. So they need to catch up and leverage more tech in marketing, account management, personalized customer care and use a lot data to empower them with intelligence and insights to serve their clients better.

How should the wealth management industry keep up then?

We’ve seen some traditional firms gear up with big tech-driven acquisitions like Unilever’s acquisition of DollarShave for $1 billion and Walmart of Jet.com for $3 billion. The wealth management industry will need to do more M&A and use technology to bring them to the forefront for their new millennial clients.

But wealth managers are pouring money into fintech?

Yes, banks are putting money into technology to leverage new trends like blockchain, which is great. In my opinion, technology like blockchain, if adopted, will bring costs down tremendously for the banks longer term, so it’s great that the banks are taking these trends seriously.