Don’t get me started, man.
Founder stories and Hollywood rom-coms: always with the inevitable happy ending. The predictable plotline. The hero standing vindicated and victorious at the end. A montage perhaps of reversal and trepidation. Doubt and worry but then the sun comes up and our hero is yet again certain and focused and undeterred by the naysayers and emerges victorious in the end. In love and business.
Of course, when you ask, “Where is the line between conviction and obstinacy?”, nobody can tell you, other than retrospectively.
My people say, “Never call anyone blessed before the end”, and by the end they mean the end of their lives. Not the end of the episode, not the end of this particular story.
You just don’t know what gives until you know for sure that it’s all been played out.
So, with that in mind, when do you call something a success? When you get an over-subscribed series whatever giving you unicorn status? Mythical creatures and paper money for the masses. When you get business sustainability?
SVB was a success before it was not.
Credit Suisse was a success before it was not.
Hell, when I finished university, the millennium was daunting. We didn’t trust our computers to compute the year dropping to 00 and Credit Suisse was the employer of choice for many of my highflying brethren graduating from the hallowed halls of Cambridge University then. It was not just a success. It was the story.
In his novel, Aunt Julia and the Scriptwriter, Mario Vargas Llosa refutes the belief that relationships come in two shapes: failed and forever. His characters fall in love, face disapproval and resistance and stand tall. They stay together for a time. A long time (eight years – don’t ask me why I remember that as it’s been three times that many years since I read the book, but I am pretty sure it was eight). And then they split. And them splitting up doesn’t make their love less true or their story less good.
A lesson to us all.
Why am I telling you this?
Because things are rough and don’t seem to be settling.
Because reading about banks failing and being taken over overnight is unsettling.
Because we know enough about the inefficiencies inside banks that most of us are not wondering “What happened?” like those outside our industry but rather “Why now?” And the point is, the two answers are intertwined in ways that cannot be simplified enough to satisfy either side: those who know a lot and those who know very little about finance are incapable of putting their finger on the thing that caused the events of recent weeks. There are narratives. There are causes. There is complexity.
But were SVB, Credit Suisse, Signature Bank and First Republic plagued by the same thing? Did they suffer what, from the outside, looks like a similar fate for the same reasons?
The answer is yes only in the highest level possible. So high level as to be useless.
What happened in each situation was specific to them, the moment and the evolution of their business. Trying to make sense of it all as ‘one thing that happened’ is not helpful.
But that is what we are trying to do. Inside the industry and outside.
We are trying to ‘story-tell’ what happened in a way that sheds light. In a way that helps us understand. That helps us feel less afraid that there is more to come.
It’s human nature to want that… and understandable but problematic to the extreme.
My beloved Terry Pratchett always said that stories find a way of getting themselves told. There is power to narrative structure. If you stack your plot in a particular way, it will build up enough force of its own eventually that no amount of reversals will stop it from playing itself out. That’s how literary tropes work. That’s why you choose a rom-com if you are in need of joy and uncomplicated platitudes. That’s why you choose a whodunit if you want to exercise your brain but leave with answers and all things explained by the end. Because you know the narrative structure you expect to get.
But in life?
In life we don’t know when the story ends. By choosing to tell a story we give in to mankind’s earliest urges but also make choices that may affect what we see, what we relate and what we teach. Especially in the context of societies (and an industry) where the memes of ‘dream it and you shall have it’ abound. Where the message of perseverance at all cost for vindication at the end seems to be woven through everything we consume, through work or leisure.
In this context, when we try to ‘story-tell’ what the hell happened, we make choices, wittingly or unwittingly.
We choose an arbitrary moment of when our story starts and ends. You have to, otherwise you can’t tell the story. But in making those choices, we make them real in that we create reality for those consuming our storytelling.
Did SVB’s collapse start with the way their exposures were stacked? Did it start with the company’s risk balancing choices? Did it start with the fact that their customer base is a concentrated, always-online echo chamber? Or did it start with the emergence of a particular type of finance institution, way before they came into existence?
And where does this story end? When HSBC paid a pound for SVB UK? Or when their loan book is assessed by the incumbent giant… and whatever comes next?
The choice of beginning and end is key as it casts the characters in different lights. Depending on when you start and finish your tale, your heroes and villains, your protagonists and irrelevant personalities shift like shadows. What’s important changes size. Just by choosing when the story you are telling starts and when your storytelling will stretch to.
And that is not all.
When we start telling a story, even if it’s dry and static and full of numbers, we choose a genre. In the telling, we choose what type of narrative steam we are building. Is it a tragedy? Is it a Hollywood drama with reversals and edge-of-your-seat anxiety but a happy resolution in the end?
The urge of finding a simple moment when it all goes wrong and a set of people who made bad choices in a small window of time is strong because it makes for good TV. It’s a neat story. You can work with that. But is it accurate?
The urge of presenting what happened as an aberration, awful and tragic and maybe avoidable but over, finished, done… and not affecting the rest of our lives any more… that urge is strong.
But is it right?
I am a big believer in storytelling as a way of thinking through the world.
It is useful. It is valuable. But it comes with responsibility. In telling the story, you make it. You are not just a neutral storyteller. You are a world builder. In explaining, you interpret.
Are you defending the industry’s obsession with optimism?
Are you pointing to the end of an era and need for radical reform?
Are you reassuring or calling folks to arms?
Where do you start and finish your tale? What’s the narrative arc? Who are the heroes and the villains?
Hollywood’s happy endings are so pleasant, aren’t they?
But they are neither guaranteed nor always… the end.
How do you know Snow White’s prince charming wasn’t an abuser after the curtain fell?
How do you know after the guy got the girl and the credits rolled he didn’t become sullen, uncommunicative and cruel?
So, as you try to story-tell your way around this, maybe Hollywood isn’t the construct you should default to.
Maybe fairy tales and fables of old are better suited to the situation we are in. Where things go wrong because life is chaotic. Where the bad guys don’t always get their comeuppance and the good guys don’t always win. Where life doesn’t always make sense. Where the point of the story is not to make you feel better but to teach you vigilance for the future.
Not a soothing explanation of what has been, but a cautionary tale to protect you from what lies ahead.
Leda Glyptis is FinTech Futures’ resident thought provocateur – she leads, writes on, lives and breathes transformation and digital disruption.
She is a recovering banker, lapsed academic and long-term resident of the banking ecosystem. She is chief client officer at 10x Future Technologies.
Leda is also a published author – her first book, Bankers Like Us: Dispatches from an Industry in Transition, is available to order here.
All opinions are her own. You can’t have them – but you are welcome to debate and comment!