Bavest #FintechPortraits

Who wouldn't want the perfect investment plan that tells you which stocks are hot right now and what you should rather keep your hands off? The two founders, Ramtin and Pedram, who studied computer science and business mathematics and have a deep understanding of investments, were faced with such requests. The two combined their core competencies: artificial intelligence and securities investments and founded bavest. Founder Ramtin tells us in an interview how their startup uses artificial intelligence to deliver global securities analysis, how much it can be relied upon, and exactly how they managed to establish themselves in the fintech market.

How did you come up with the idea to found your startup?

My co-founder Pedram had been involved with investments for a long time. Even before he started his studies in business mathematics, he wrote a book on the subject of investing money in the stock market. As a result, many friends and acquaintances approached him and asked for help in choosing stocks or ETFs. At the same time, I started studying computer science at the Karlsruhe Institute of Technology and became intensively involved with the topic of artificial intelligence. After we kept getting asked for tips and analysis on investments, I suggested automating the process. Then, at the end of 2018, we started brainstorming and initially collected approaches for AI-based data analysis of assets. In order to test the idea on a broad scale, we participated in the startup competition "GROW" at KIT and made it to the finals. The feedback was very good, which ultimately led us to found Bavest Technologies.

And how exactly does Bavest work?

Our products allow customers to perform AI-based analysis of stocks and ETFs. For this purpose, we have developed an artificial intelligence that is able to generate forecasts for the future. In doing so, our AI is based on various economic and financial mathematical models. Our service is primarily aimed at investors with a long-term investment horizon, for which fundamental data and macroeconomic models are ideally suited . Our clients receive automated reports within 24 hours. Our next goal is the launch of our platform at the end of the year. This will then enable our customers to perform AI-based analyses of securities around the world, via the web or cell phone.

As an investor, do I have a guarantee? What happens if the AI gives me the wrong tips?

Investing in securities always involves risk, of course. Bavest's analyses are not an investment recommendation, but only an objective analysis of a company's data, which may not be complete or correct at any time, see Wirecard. However, cases like Wirecard give us new input for ideas to build in other models.

What was the most valuable piece of advice someone gave you during your startup phase?

There is absolutely no point in developing something, especially if it is more elaborate, only to realize at the end that no one wants to use the product. Therefore: Talk to potential customers from the beginning! Also, don't be afraid that an idea will be "stolen". An idea is worthless if it lacks implementation and added value for society.

What were the biggest hurdles you had to overcome at the beginning of your startup?

One of the first big hurdles was the legal basis. In Germany or in the EU, there are clear rules on the subject of finance, so we first had to find out what the prevailing legal basis is when it comes to the subject of investment and securities analysis. The next point was: the bureaucracy of the foundation. Since we were both founding for the first time, the enormous bureaucracy and lack of digitalization in Germany was a big hurdle for us to overcome.

What support would you have liked to have had during your startup?

What we lacked was a contact person who could familiarize us with the legal situation regarding finances in Germany. The necessary structures are still missing; if you compare Germany with the USA or China, there is still a lot of catching up to do.

Did you work with an accelerator?

No.

What would you have wanted from a collaboration with an accelerator?

Most likely, that you learn from other experienced founders and that the accelerator helps you especially where the founding team might have deficits.

There are currently around 900 fintech companies in Germany. How do you manage to assert yourself in such a booming market?

Openness, flexibility and communication skills are very essential qualities to become successful in the fintech sector. With new technologies emerging all the time and new demands from customers, you have to be able to adapt quickly or disruption will come knocking at the door. One of the most important aspects is customer intimacy: you have to build what customers want and not develop past what they want.

How do you feel about the current funding opportunities for fintechs in Germany?

We never actively looked for funding opportunities because our mentors said it was a long and bureaucratic process. Even though there are funding programs that might be good in the future, the bureaucratic process needs to become digital and easier.

What direction do you think the fintech market is going in?

The Fintech market is one of the most interesting in our society.... Many processes are not yet digitized and billions of people are just waiting for better, simpler solutions to come and use them. Whether in the B2C or B2B sector, there is a lot of disruption and innovation in the Fintech space. It will be the case that Fintech products will be even more personalized to the wishes of customers and, above all, a lot will be automated. I think that in general artificial intelligence as a topic will advance a lot, such as in the detection of conspicuous transactions or in the analysis of large amounts of data in the financial sector. If you look at China, for example, or the U.S. with Square, which is making the financial system simpler and more accessible, you quickly realize: it's a very big and exciting market.

Thank you very much for the interview. Personal details: Ramtin Babaei founded the fintech Bavest in 2018 together with his brother Pedram Babaei. After specializing particularly in artificial intelligence in his computer science studies, he worked as a software developer at one of Germany's largest robo-advisors. Here he gained experience on the topic of digital financial products and asset management, which he now contributes to the development of Bavest together with Pedram.