Boston’s major finance companies are teaming up with startups to develop innovative technology for the industry through a new program created by the tech accelerator MassChallenge.
The startups will focus on industry issues ranging from automating the lending process for mid-sized businesses to software that can help families understand the true cost of college. They’ll work one-on-one with established companies like MassMutual, Fidelity Investments and John Hancock over six months starting in mid-January.
Devon Sherman, the program manager of MassChallenge FinTech, said the goal is to solve major challenges in the finance industry.
“It’s rapidly changing every day and there’s always a need for innovation, but in particular, there’s a real need to make it easier for the bigger financial institutions and the smaller startups to work together,” Sherman said in a phone interview.
The partnerships between the firms and startups are a first for MassChallenge, and part of its effort to help develop the burgeoning FinTech ecosystem in Boston. Like MassChallenge’s specialized program for digital health startups, the startups in the FinTech program are later-stage startups that have already raised money and gained some traction with their products. (Other MassChallenge programs focus on early-stage startups that are still developing.)
“On the corporate enterprise side, these guys have the subject matter expertise, the capital, as well as the distribution. And on the FinTech startup side, these are companies that are really good at designing the product around the user experience,” Sherman said.
The FinTech program also has a few non-traditional partners, including the MBTA, which is looking at ways to utilize data, improve fare payment and streamline the procurement process, according to Sherman.
The 21 startups in the FinTech program will compete for $250,000 in cash prizes.