Parsing Fintech's Whimsical Name Game

While writing up a piece examining intellectual property earlier this week, I plumbed the depths of my memory for the name of a low-latency provider that was involved in messy litigation in Australia—unsurprisingly, I came up empty.

I knew it was an odd name; I knew it started with a 'z.' But until our Inside Market Data editor Max Bowie—who has an elephant's knack for recollection—finally infomed me it was Zeptonics, I was completely helpless. The lawsuit stuck; the name, despite its unusualness, did not.

All of this toiling reminded me of a presentation I attended recently for New York's Fintech Innovation Lab, as well. Six startups from this year's cohort were featured, and almost all of them had snazzy-sounding, and even peculiar-looking, names.

Be it a randomly-capitalized letter in the middle, or a few vowels missing entirely, or a portmanteau—yesterday's news about Imatchative's new AltX platform is my recent favorite—it would appear not only common but, indeed, obligatory for a new company in our space to feature this kind of creative eponymy from the start.

Risk and Reward?
So, what's really in a name? Besides creating fodder for newsroom conversation, does this strategy actually work?

Well, especially in a saturated market segment—there's a reason market data vendors have the most outlandish names—having an identity that stands out shows a willingness to take a risk. It could even get potential clients to think or to laugh—and therefore, a couple days later, to remember.

As these small shops grow, or even get bought, I've been fascinated by how passionately their founders stick with the name, or lament when it's rubbished in favor of more dry or aligned branding by new ownership. It goes from a gimmick to a point of pride.

Then again, when an institutional investor is performing due diligence on a buy side and the question of their service providers comes up, explaining what "that startup with a funny name" actually does is a more serious matter. If not properly explained, it might even be a dealbreaker. Keeping in mind that many of these buy-side firms—hedge funds, especially—are named after some predicable combination of trees, mountaintops, castles, and Grecian warriors. 

This could all be a question of context. After all, SunGard and Misys are normal-sounding names to those of us in the industry because they've been around seemingly forever—and more importantly, because they're massively successful. Whether Markit or Tradeweb or—gasp—International Business Machines (how snooze-worthy!), the products and client service, and eventually the expansion strategy and acquisitions, ultimately speak for the name, rather than the other way around. And the idea that such branding simplicity can't work in the current era is ridiculous, too. Just ask plain-jane Amazon Web Services (AWS), or baby Prince George ... well, once he can speak, anyway.

Eccentrics Welcome
But of course, not all of us are born into royalty; nor are all great services born only of companies of IBM or Amazon's scale and pedigree. And it's refreshing to constantly run across small providers with a different take on things, that really believe they can make it, and believe they know how to, as well.

Just what to call the next great new company would seem a fundamental, but astonishingly important part of that process.

Compared to other matters, though, perhaps it's actually neither.