Innovation Through Collaboration: The Delaware Way
FINTECH Innovation Hub: Seeking Solutions for the Underserved
The term “fintech” — the shorthand word for “financial technology” — conjures visions of expensive new Silicon Valley startups underwritten by venture capitalists. And fintech is that. But fintech development can also be crucial to underserved communities where conventional financial transactions may often be difficult to execute.
That is a primary role Mike Bowman sees for the recently opened FinTech Innovation Hub on the University of Delaware’s STAR Campus — to help execute business transactions for those individuals and small businesses that most need assistance. Bowman is president and CEO of Delaware Technology Park (DTP), which owns the FinTech building and whose headquarters are now located there.
“The FinTech facility is first of all focused on finding solutions for underserved areas — and not just discovering what the problems are,” Bowman says, using what has become the unofficial purpose statement for the facility and its tenants.
The FinTech Hub got off the ground figuratively and literally when Discover Bank approved a $38 million loan to DTP to get construction underway, and the finished six-story facility was officially occupied last summer just in time for Bowman and UD to host a meeting of the Association of University Research Parks, of which STAR Campus is a sterling example.
Today, the FinTech Innovation Hub is occupied by a Noah’s Ark collection of diverse organizations with the central purpose of advancing fintech knowledge and application. In addition to DTP, Discover Bank is a tenant in the building it helped finance. A government agency, the Delaware Small Business Development Center, has its offices there. UD’s Lerner College of Business & Economics and its College of Engineering both have presences there. So does the Philadelphia-based nonprofit Tech Impact, with its Data Innovation Lab subsidiary.
Today, as it is completing its first year of occupancy, the FinTech Innovation Hub is a buzzing hive of activities
Merging Data and Technology
The Data Innovation Lab (DIL) at the FinTech Innovation Hub was founded in October 2020 to help track COVID data in Delaware, financed by a $2 million grant from the New Castle County CARES Act. A year later, DIL merged with Tech Impact, a nonprofit provider of technology training, education and solutions, mainly for nonprofit and government organizations. Combined, the two organizations are aiding communities and nonprofits in using data and technology to solve important issues.
“As a nonprofit, about 40% of our income is from grants and contributions, and 60% from earned revenue for projects and services we provide, generally at break-even costs,” says Patrick Callihan, executive director of Tech Impact.
One such grant was received last April — $3 million from the American Rescue Plan to fund a fellowship program to support Delaware agencies in leveraging data and technology to develop pandemic relief solutions for Delaware communities.
“We hire local students just out of college in a fellowship program to work for a year developing products for the state,” Callihan says. “For example, these interns have been looking at population patterns for infectious diseases to see where financial resource allocation should go. It also helps to better determine where healthcare resources are needed.”
DIL currently has two employees and eight fellows working on campus, which Callihan sees as being a significant advantage. “Being located in the FinTech building is good for us,” he says, “because the fellows working on projects can leverage their existing ties with the university.
Making Cybertechnology More Accessible
“Cybertechnology is a big part of what we do because it’s important to financial literacy, to financial equity and to financial health,” Bowman says. “If you are an individual living where you don’t have a bank account, then you can’t get a bank loan for anything, not even a car. And 60% of small businesses fail when they are the subject of a cyber attack — they just aren’t equipped to handle it.”
Bowman points to an interdisciplinary program recently launched at the FinTech Innovation Hub to help develop mobile ID devices that will safely and securely verify identities, a significant need for the underserved. (The Division of Motor Vehicles is the only entity in the state currently using mobile ID services, in this case allowing drivers to utilize an electronic version of a driver’s license through a phone app instead of having a hard copy on hand.)
DTP also is working on plans to start a Center for Financial Inclusion and Technology Innovation, which will support about 10 fintech startups building products that assist underserved populations.
The center “will be an incubator-accelerator in an atmosphere somewhat like that of The Mill,” Bowman says, referencing a Delaware shared-space facility. The center will serve existing companies wanting to grow to the next level and is patterned after an Arkansas center run by Wayne Miller, who, Bowman says, is coming to Delaware to help build it. “Our goal is to be the center of excellence for the East Coast, a place where people come to grow their business faster.”
In the cybersecurity space, the FinTech Innovation Hub also “has a wall-to-wall range of students, all working on the internet, working and training to improve cybersecurity,” Bowman says, and they are exploring other areas such as AI and virtual reality. “They are looking for flaws and how to fix them,” he says, “to help small businesses and perhaps even be hired by them.”
The atmosphere at the FinTech Innovation Hub, Bowman says, is that it’s the place to go for collaborative work. “Half of it is UD, and half is private businesses,” Bowman says. “Our motto is ‘maximum collision, minimum friction.’ We have a density of people doing a diversity of things, yet who are able to discuss what the other is doing.”
To further the collaborative concept, the Grain Craft Bar + Kitchen gastropub chain recently opened a facility on the first floor. “The first two things you will see when you come into the building will be the Grain pub and a giant conference room, which both will set the mood for conversation,” Bowman says. “We are open to any STAR student, and various organizations are clamoring to schedule events here.”
Fitting to the fintech image, it will give the FinTech Innovation Hub, Bowman says, “a touch of Silicon Valley.” And it’s not by accident that the hub’s address is 591 Collaboration Way.