Capital.com has been one of the most significant investments into a new brand in recent years, with the company starting with a $25 million investment. The firm has chosen a unique approach focused on mobile and an AI-powered trading assistant.
With the company launching in June last year, and the first anniversary of operations closing in, the firm has welcomed a new CEO. The former IG Head of IT and most recently Chief Digital Experience Officer, Ivan Gowan joined a company that is mainly focusing on differentiating itself from competitors by using smart technology.
Gowan shared some insights on the company’s development with Finance Magnates in a short interview a couple of months after his appointment.
The New CEO
What was the reason for Capital.com to look for a new CEO less than a year after launch?
We have exciting plans to develop internationally, expanding into new jurisdictions, while at the same time building and enhancing our trading platform. To realize these ambitions and the potential of Capital.com, a new CEO was required with deep experience and specific knowledge of the industry.
Prior to joining Capital.com, I worked at IG for 15 years. I was a member of the Senior Leadership Team and led the IT development department in building market-leading trading platforms. During this time, I helped to transform IG from a predominantly phone-based business into a global market leader in CFDs and spread betting, and the company’s market cap rose from £255m to £3bn.
What are the plans for the company in 2018 and how did the firm finish 2017?
Our goal is to make the most personalized, user-friendly, easy to use and AI backed trading platform. We believe that we already have a great platform and are continually working on adding new features. We currently have 17,000 daily active users across the world, and we are now working on entering new markets and gaining the respective authorizations within these markets.
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We have launched the Investmate educational app and are aiming to educate one million people on the basics of finance through this platform, providing people with the knowledge and tools they need to become successful retail investors.
What is the latest news around the Smart Feed AI-powered software? Is the tool performing as expected and does it help with on-boarding more clients?
Our Smart Feed function, powered by fast-learning artificial intelligence technology, delivers tailored news feeds, analysis, and research materials based on users’ in-app behavior. By analyzing users’ activity in real-time, the Smart Feed function is also able to identify common trading biases and behavioral patterns, and we’ve found the function to be not only incredibly useful for customers but also accurate in its analysis and recommendations of targeted educational content in the event biases are detected.
We are continually improving the AI algorithms and are certain that the future of trading will be reliant upon combining both human and artificial intelligence.
What do you think about the new upcoming regulatory changes and do you feel like capital.com’s business model is in tune with the new regulatory environment?
ESMA has put forward a raft of sensible measures, and we are ready for these changes to our industry. CFD providers have a responsibility to help retail investors manage their appetite for risk against their ability to handle any losses, and ESMA’s temporary measures provide an improved yardstick for providers to make sure that the industry gets this balance right. We believe ESMA regulatory changes will be the foundation to improve the reputation of CFD market.
ESMA’s negative balance protection and margin closeout rule are central to protecting retail clients from the risks of sudden gaps developing in the positions that they take and the potential for significant loses and debt, and we are very much behind these measures. Furthermore, the restrictions on incentives offered in advertising promotions are good for client outcomes – this is a financial product, and people need to be clear-sighted about what CFD trading entails. Marketing should not make untrue statements and contain appropriate risk warnings. All of these measures – negative balance protection, margin closeout, and marketing without bonus incentives are very much part of Capital.com’s DNA, and we already comply with these measures.
In responding to these measures set out by ESMA, Capital.com views the needs of the customer as paramount, and we are fully prepared to be compliant with ESMA measured as they become mandated.