This short post is inspired by a conversation I had recently with a couple of finance professors from top business schools who had some questions about blockchains.
Prof A explained that he had heard all the fuss about blockchains but was unsure whether it was revolutionary or evolutionary (I think the word disruptive was also used). I have written about disruption in Fintech and the Evolutionary vs Revolutionary aspects of distributed ledgers before (hint: it depends, it’s both, and yes, perhaps).
Then he asked, “Yes, but is there anything new?”
How should incumbents, startups, and VCs think about FinTech, disruption, and blockchains?
Over Chinese New Year I read about Professor Clayton Christensen’s fascinating model for identifying and dealing with disruptive innovation, and attempt to summarise it in this post.
Here we learn the differences and dynamics between disruptive innovation, sustaining innovation, and efficiency innovation. Each of them interact with the others, and the appropriate approaches and defence strategies differ. I then provide my own thoughts on how this framework relates to FinTech for incumbents, startups, and venture capitalists.