From financial services to blockchain and crypto: How executives are making the switch

Source: Heidrick & Struggles

Today, Heidrick & Struggles, a premier provider of global leadership advisory and on-demand talent solutions, in partnership with the Global Blockchain Business Council, have launched a study titled, From Financial Services to Blockchain and Crypto: How Executives Are Making the Switch.

The blockchain and crypto industry has taken the world by storm, especially in the last few years. It has now become so popular and in demand that financial services are having to put it on their agenda, whether they wish to or not. The sector is also attracting attention from executives in traditional financial services firms who are becoming increasingly comfortable joining this new and often volatile industry.

This study was undertaken to explore how executives are making the transition from traditional financial services firms to blockchain and crypto companies – and what they need to know when they contemplate the move.

Some Key Findings

Nearly half of survey respondents (49%) joined the blockchain and crypto industry from roles in investment banking, having held high-level positions at their previous institutions, such as senior vice presidents (33%) or managing directors (28%).

The study shows that a number of senior executives from traditional financial services companies are more open to joining blockchain and crypto companies as it becomes clearer that both cryptocurrencies and blockchain are driving forces for the future of financial services.

Nearly a third of respondents said they left their previous role to start a company (31%). The fact that so many executives are willing to take a risk on a new venture underscores blockchain’s role in the broader financial industry.

Another interesting finding is that 43% said their companies are in the start-up phase, and a further 23% are growth-stage organisations. Only 9% said they work for large, privately held enterprises, so for these executives to go from being at senior levels in their respective companies shows the future they see for the financial sector and that is in blockchain and crypto.

When comparing total compensation for executives in blockchain overall with those in traditional banking, nearly half of executives said they would expect compensation to be the same or lower for executives in blockchain and crypto and are often willing to accept a lower base rate of compensation. They know they are taking a risk in entering the field, but they also know the potential rewards in terms of equity are significant because the volume of investment keeps growing. With one respondent even saying “Blockchain is constantly evolving and requires skills for adaptability, curiosity, genuine interest, and a strong conviction that we are doing the right thing.”

Considerations When Contemplating Joining a Blockchain / Crypto Company

Blockchain and crypto companies offer exceptional room for individual growth. Because the field is young and growing fast, functions and responsibilities are less clearly defined than in other industries and therefore less rigid. Blockchain and crypto companies are more willing to hire professionals with less experience in a particular role and are ready to promote them and expand their responsibilities on an accelerated timeline.

Flexibility means leaders can shape the way their companies operate. Flexibility is a key incentive for executives making the switch, and as hierarchies, processes, and roles are less defined, traditional factors such as time spent in the office have faded in terms of relevance as the COVID-19 pandemic progressed and working from home became a common occurrence.

The blockchain and crypto industry requires different leadership capabilities than traditional financial services. To keep up with the demands of a fast-moving field, successful candidates need grit, resilience, and the willingness to go all in. Executives looking to join the blockchain and crypto sector need to have a high risk tolerance and the ability to operate at a considerably more accelerated pace than more traditional sectors. Companies are also prioritising culture impact over role-specific experience. Blockchain and crypto companies are looking for professionals with enough industry experience to fill gaps required by their specific context, but needs change with the evolution of the company.

Looking ahead, one thing is clear, the blockchain, crypto, and digital assets space will continue to evolve in unpredictable and dramatic ways. In just the past months, the crypto market cap has hovered around $2 trillion and is expected to continue growing in the long-term and with this growth, you need the right people at the forefront of your organisation to lead and guide it to success.