• Opening the banking framework to reduce integration costs • Improving strategic principal-investment capabilities to overcome the lack of VC funding Banks also need to manage their technology stacks as investors do and quantify the value of their portfolios. For example, investment banks can identify potential ven- tures by leveraging their current IT assets, much the way Goldman Sachs has done by forming a joint venture with Synchronoss to begin monetizing its IP in mobile communication technologies. Overall, the shifting competitive landscape has heightened the urgency for CM play- ers to proactively explore fintech adoption. Nonbank players have already broken into traditional fortresses of investment banking, such as market provisioning. Ca- pability gaps between nonbanks and banks have been decreasing, while investors have been growing impatient in the face of chronic underperformance. A wait-and- see approach is no longer viable. Banks that defer their options will lose significant value by not participating in the innovation process. They face the risk of disinter- mediation by competitors. Ultimately, fintechs are introducing new paradigms that CM players can exploit to their advantage. (See the Appendix.) Proliferation in innovation means that the landscape is complex and difficult to navigate. By establishing labs to focus on early- stage, novel technologies that are core to their principal activities, and by systemati- cally pursuing adjacencies that have synergies with their existing portfolios, invest- ment banks can position their businesses for a bright digital future. 16 Fintech in Capital Markets