Emerging Infrastructure for Next Gen AI-based Financial Tech

0:02Brett King: Hi, welcome to Breaking Banks. I'm your host, Brett King, and this week we have a great show looking at the problem of emerging infrastructure for highly autonomous financial services systems, basically the next generation of AI-based financial technology. To do that, we're inviting on the show Rob Rooney. He's the co-founder and CEO of Hyperlayer. Some of you might know Rob from his time at Morgan Stanley, where he spent over 30 years there. He ran Morgan Stanley International through the Brexit period and later became Global Head of Technology Operations and Firm Resilience. So obviously, we're going to get into infrastructure resilience today in the conversation, talking particularly about the response to some of the cybersecurity risks we see and so forth.

0:56Brett King: Hyperlayer is going after a problem that's very common amongst the banks that I visit around the world. And that is that every bank wants to be like a fintech. They want to create their sort of digital competency. They want to have the cool apps. They want to be able to do the onboarding of customers rapidly. But they want to be able to launch products as fast as the neobanks. The problem is people within banks know they have a core problem. They have a banking core problem, a core banking problem, in that those core systems are very hard to adapt when it comes to products, services, processes, and so forth.

1:41Brett King: So rather than doing a full-blown multi-year core system replacement, Hyperlayer allows to us to add a programmable layer on top of whatever core a bank already has so they can build and launch new products in an agile fashion in weeks. And of course, has the requisite governance built in and orchestration layer built in from day one. Now, Rob built this with Paul Rolls and the two of them have worked together for more than 30 years. This type of longevity and business partnership, I don't have to tell you, is rare these days. But if you look at what's happening in OpenAI and Anthropik, you know, and people leaving and making the news, keeping a partnership going that long and turning that into a company, I think says a lot about the drivers of a company like Hyperlayer.

2:36Brett King: So Rob Rooney, welcome to Breaking Banks. Brett, thanks for having me. It's a pleasure to be here. Now, I want to start off with working for a big bank, one of the largest financial services organizations in the world, and getting to the sort of group head of technology. Tell me about the journey that took you there, first of all, before we get into the sort of founder story. so brett i had a really privileged career um and so many things are in life are about luck and i certainly have plenty of that myself but you you're you're talking to me here in new york city i happen to go to college in new york i went to columbia uptown uh and i had a maths background and i had an ambition to stay in new york i wasn't particularly um foresightful on what i wanted to do with my life, except that New York was an expensive place in 1990.

3:38And I needed a job that paid well. And there were these things called investment banks and a place called Wall Street downtown. And my background was part of New York. And so I, you know, I interviewed and really the first job I got was at Morgan Stanley. And I was there for 30 years. But I also even at Morgan Stanley Brett had an unusual career in that I did a bunch of different things. I started out as a structurer or a quant, as we would call them today. And that's where Paul and I met in 1992. Paul was a far, far, far more talented quant than I was ever going to be. But we met back then, and my career evolved.

4:20And I became a trader and ultimately ran capital markets and then ran global fixed income, which is the bond business basically for Morgan Stanley. And then I was CEO of Morgan Stanley International. And that occurred over the Brexit period. So that became a big restructuring job. And that really was the journey that started me in the infrastructure world of banking because I had to lead the restructuring of Morgan Stanley for Brexit. And because of that, I was asked to take over the technology and infrastructure for the whole company. and I saw a lot of the problems that existed for banks of the size and scale and the complexity of Morgan Stanley to innovate and go fast.

5:05And Hyperlayer is the response to that. So that's kind of my journey in a nutshell.

5:10Brett King: All right. But you didn't start as a coder. You didn't start as a systems architect and you ended up running global technology. So at what point did you have the Jamie Dimon come to Jesus moment where you realized that technology was the future? And how did you educate yourself sufficiently to be able to run what must have been a massive technology department? That's a terrific question. And again, I'll be humble that it wasn't some grand plan of mine. My familiarity and love of technology was a slow burn. You know, back in 1990, I was in structured finance, which was a really cutting edge business way back when.

5:59And, you know, we were building our own models back in the early versions of Excel to run complex cash flows and get them into securitizations and bonds and all of this stuff. But then if you are in the markets, businesses in a large global investment bank, you're essentially in a technology business. And while I wasn't a technologist, I was a big user and owner of technology for 25 years. And then in the suddenness of Brexit, having to re-engineer large parts of Morgan Stanley as CEO, that was on me. And while I absolutely wasn't in their hands on keyboard, I was having to engage with my partners in tech and ops and finance and legal to understand how all of these flows work.

6:46um and and brett really you know what you learn in uh a place like morgan stanley is it's in many ways like so many other businesses it's really a technology company but of course it isn't right it's a bank it's an investment bank it's a wealth manager um and you don't do tech for tech's sake you do tech to solve business problems so i would say that i became extremely familiar with the tech and I knew more about the tech than the rest of my colleagues in the businesses, but I also knew more about the business than anybody in tech. So I was that bilingual agent that was bringing the business and technology together.

7:24Brett King: It's like a superpower, frankly, you know, because, you know, particularly in banking, you know, but this is the thing is, is banking and, you know, financial services in general have become dominantly technical. so you know it's it's it's just the the nature so um you know tell me about the process of coming up with the idea um of uh of creating your own startup hyper layer and um you know what was was there a um a clear moment where you knew you had to do this were you still in Morgan Stanley Did you leave first and then sort of have to decide what you were doing? You know, what was – give me the founder story.

8:15So, Brett, the founder story starts with Paul. It doesn't start with me. Paul left Morgan Stanley in 2006 to set up his own boutique structured finance merchant bank in the UK called AGFE. And it's a very successful platform serving a lot of the big banks and a lot of the big investors. and they structure transactions and are deep experts on merchant finance, supply chain finance, structured finance, et cetera. And they saw a hole in the market in the late teens where rates were still at zero. Merchants were paying a lot of money for short-term capital from banks, and customers had their money on deposit at zero.

8:59And so they had a thesis that customers could, in fact, start to deposit some money where they know they're going to spend it, um and the merchants would pay them a healthy return much higher than zero in a bank um and the um the merchants themselves would though be still paying a lot less than they were paying the banks for short-term working capital and a company was born called hyper jar um and hyper jar was built on fintech infrastructure it had bank rails and payments platform and card and issuer processor and KYC and AML and the Lego blocks that you would need to build a banking platform.

9:39But it didn't do really much of what Paul needed it to do. In order to solve this problem, he needed accounts that could be made social, meaning accounts that a mom could share with her kids and her husband, that social groups could share together. He needed accounts that were smart, such that when you were at Tesco, you spent from a Tesco account. But when you were at Marks & Spencer's in the UK, you spent from a Marks & Spencer's account. And that all had to be automated, right? He wanted to take all of the friction away from it. So Paul invented what is now the founding technology behind Hyperlayer.

10:15And it is a decoupled innovation layer that sits on top of existing infrastructure. and it allows for accounts and ledgers and stores of value to be programmable by the bank or the operator, in this case, Hyperjar, by the customer, by the merchants in that case. So that was the Paul story. And I was an early investor in Hyperjar when he spun it out of his merchant bank in 2019. At the same time, Morgan Stanley is growing like gangbusters. I'm responsible for the global infrastructure and the tech stack. We were well on our way to suffering through an integration of a Smith Barney acquisition that you might remember occurred shortly after the crisis.

10:57But then in 2020, we acquired E-Trade. And so I'm living with the problem that is sometimes misspoken. People say that a bank has a legacy tech stack. And the only thing that's wrong with that statement is banks have legacy tech stacks, plural. So I'm there the morning after we closed the E-Trade deal. And my boss at the time, a guy named James Gorman, walks in my office and says, we really need to spruce this thing up and look like Robinhood as soon as we can. And I said, OK, great, let's go. But I'm looking at four different bank platforms in the Morgan Stanley E-Trade ecosystem. I'm looking at three or four different broker-dealer platforms.

11:42So while the teams went away and came back and started to talk about core infrastructure modernization and rip and replace, it was ultimately a very long journey, a decade like for this size and scale of Morgan Stanley. It was going to be enormously expensive. It was going to be enormously risky. And you add those three things up, and it equals impossible. So that was not the answer. and we were looking for another idea and i was very familiar with what paul had done at hyperjar but it was done at small scale at this point hyperjar is 400 000 people so the morgan stanley engineers and i came over and we conspired with paul as to how could you scale this innovative approach to decoupling product and customer configurability from the underlying core infrastructure?

12:28Could it work across multiple cores? And ultimately, we agreed yes and yes. And we mapped out a strategy as to how you do it. And, you know, I saw this, Brett, as a universal problem for banks. And I'm a big believer in banks. You'll hear about that over and over again on this podcast. But I saw it as a universal problem. And I gave Paul a call and I said, okay, we want to pivot this hyper jar thing of yours to global enterprise. And I loved it so much. I bought the company, you might say, and that was it. I retired from Morgan Stanley to do this.

13:05Brett King: Okay. It's a good story. It certainly shows you a level of confidence in the platform. And it's a great way to come in. The one thing that I've talked about frequently, both here on the show, but also, you know, in the work that I've done in terms of writing about changes to the sector, is that there's two elements that are going to get you there at the end of the day in the face of what's already happening in fintech and, you know, in banking in general. Now, we had this conversation in preparing for this. So, So, you know, I'm aware of how you think about or how you classify the different operators in the space.

13:57Brett King: But we just had an event, you know, it's going to be by the time this airs, it's probably going to be, you know, a week or so in the past or maybe a couple of weeks in the past. But just yesterday, I watched Nubank do their big launch in Miami of a pretty good product, a high-yield account for the US market, a multi-currency card, which you could link to stable coins, and a very cool brand and a very, very cool app stack and so forth. Their technical agility and their cultural agility to be able to come into a market like the United States to innovate on their technology is sort of second to none.

14:41Brett King: You can look at Revolut and what they're doing in terms of artificial intelligence and so forth right now. They just got their provisional US license. They got the UK license not that long ago either. So, you know, we have these entrants coming in and really transforming the way we think about the day-to-day banking experience. But at the heart of it is this technical agility and cultural agility. And one of the challenges that you would have faced, no doubt in Morgan Stanley, is as you've already rightly sort of pointed out, is you've got all of these technical legacy debt. You know, you've got all of these different cores and different systems that you have to stack together.

15:26Brett King: Now, you know, companies like Nubank and Revolut are going to have their own technical debt soon enough because, you know, some of their systems are 10 years old now. But at the same time, you know, they're built on top of the cloud. They can swap in and out components much faster. They have API layers rather. They have their data lakes and things like that. They don't really have to re-engineer their entire architecture to be able to do this because they've started on top of the cloud in a fairly agile manner. But for a bank like Morgan Stanley and for the banks that Hyperlayer serves, this is the key problem.

16:07Brett King: And your you're coming in with this layer over the top to give these incredible capabilities. But is that going to be enough, you know, in a world where agents will be able to code new core banking systems in days, you know, theoretically? Is it, you know, are we going to see, you know, is this the approach or do you think eventually we're just going to see, you know, like complete re-engineering of the technology layer, you know, just replacing all of these old legacy systems? Or is that just too hard? Brett, I think you put it exceptionally well. You know, in simple terms, I would say, you know, the race is on.

16:56And the two you mentioned, Nubank and Revolut, they've effectively fired the pistol. Those are terrific platforms, incredibly impressive stories. The growth has been remarkable. I think quite different platforms. I think NewBank has really embraced the idea from its earliest days of being a full-service banking proposition. Revolut obviously comes from a different place. I think Revolut will also go in a different direction. It's my personal opinion. I don't work at Revolut or have any insight there. But whatever the answer, those are really powerful challenges to the incumbent banking system.

17:40And I think that you and I would be in violent agreement that the banks are going to have to respond to this pretty urgently. And that's a little bit where we come in. You know, I think that what we're really talking about when we talk about decoupling is I'm also talking about decoupling your mindset a little bit. When we talk about core infrastructure, we don't say that modern core infrastructure is bad. We don't say it's unnecessary. But our view is that you should be looking at your core infrastructure for the purposes that it should serve. And our thesis is that everybody would do much better with an incredibly modern, cloud-native, thin core infrastructure, and that everybody, Monzo and Revolut and Nubank included, are going to need innovation layers that sit between their ledgers and their customer-facing platforms.

18:42And that's where we come in. Our thesis to the banks is you don't have to wait to get that functionality that Monzo and Revolut and NewBank have until your core infrastructure is replaced. Don't build all those capabilities into core infrastructure, no matter how modern and sexy you think it is. That's the wrong answer. You can do that now. And while you're at it, by the way, underneath, you better be upgrading that core infrastructure. But we give you the opportunity to do it in the right way at the right pace because it is difficult, it is expensive, and it is risky.

19:22Brett King: Okay, but let's take the second piece of that. That's the technological approach. But the cultural approach, this is also a big difference that you see between the Revoluts and the new banks of the world. They can spin up products and services a lot faster. They have, you know, they're very agile. You know, we're talking days to sort of create prototypes and things like that. You know, those systems, those decision-making processes in, you know, larger organizations take a lot longer, particularly because of legacy process and legacy policy and legacy tech to some extent. So having been in the trenches with that, how do you marry Hyperlayer from a cultural perspective in terms to educate banks on how that can be most effective?

20:13That's a great question. I'd say there are two things that are really going on with why banks move too slowly. And one of them is the history of trying to go fast has failed so often, which is really technical issues that in many respects, you've got wildly talented people in these banks, but they've just their expectations are lower. And so I think part of the solution is we have to go in and demonstrate that innovation and product launches can be extremely fast. But then you'll run into the second problem, which I think you're also talking about, which is cultural, is how do you get through the decision layers for a new problem that maybe is totally ready, but needs to then go through a whole bunch of different processes and protocols and procedures?

21:02And, Brett, having lived it, there's a lot of history there that is significantly regulatory, right? And if I can respectfully say about these disruptors, particularly in the major markets like the U.S. and the U.K. and Europe, is they're not big enough yet, Brett, to really matter to the regulators. They haven't been challenged yet. They're not regulated as heavily as the big incumbents are. So they don't yet face the burdens. And maybe they won't if they make no mistakes. But listen, the world is full of mistakes. All of these new entrants at some point will hit a speed bump with a regulator.

21:44And it'll be very interesting to see how they retain their culture of speed and innovation if they ever hit a regulatory bump. On the other hand, the challenge to the big banks is just going to be at, the challenge to the big banks is going to be how do they break away from this historical burden of being fearful of the next regulatory hiccup? Sorry, Brett.

22:10Brett King: Yeah, no, no, no, that's fine. I think Nick and David might take exception at your categorization of that with, you know, particularly dealing with US regulators and so forth. But I think there's another problem, which I think we can get to after the break, which is in a hyperscaling environment, this technology will support. You can no longer supervise agentic hyperscaled financial services with human supervisors. So regulation in itself is going to have to change to the regulatory inversion, where now the machines are monitoring and supervising the system. And there's a very real question as to how in a regulatory environment, such as in the United States, that could be executed.

23:06Brett King: But just before we go to break, if you're meeting with a CEO and he says, what should I do? You know, you've been in the trenches. You've been where I am running this. What's your best advice to me in terms of how quickly I can bridge this gap? What's your advice to them? so my um my advice to you uh as the ceo of a large incumbent is understand fundamentally what your massive advantages are versus these disruptors and you have many um lean into those understand aggressively what your weaknesses are and that's really the speed and agility breadth that you've been talking about and lean into that and don't wait you don't have time i I think you underline this point in so many different ways.

24:02But what I'm saying to the incumbents mostly is the standard thing is I'm going to upgrade my core infrastructure and then I can compete with Revolut and NewBank. You don't have time to do that. It's not the right answer, by the way, but you don't have time to do it anyway. So you've got to get going now. These guys are – they've scaled the walls, Brett. They're coming over the walls now. They're onshore in the US if you're an American bank. So you've got to get going.

24:28Brett King: Well, yeah, I mean, that's the US perspective and you're sitting in New York, so I get that. European banks might have a completely different, and Latin American banks would have a completely different perspective. You know, if you're on an earnings call for Itai, so Itau, you know, every earnings call, what are you going to do about NewBank? You know, for HSBC, what are you going to do about Revolut, right? So they're over the wall, right? Anyway, let's take a quick break, Rob. And when we come back, let's get into a little bit more detail about Hyperlayer and the technology you're building and the future agentic banking world that's coming.

25:10Brett King: You're listening to Breaking Banks. We're going to take a quick break and we'll be right back. Welcome back to Breaking Banks. I'm with Rob Rooney from Hyperlayer and he is the CEO of Hyperlayer. Previously with Morgan Stanley, ran their head. It was global head of technology operations and firm resilience. But today it has gone to the dark side. Well, not really because he's infrastructure layer for traditional players, but he's working for a fintech. So, Rob, let me just ask you about, before we sort of dive into some of the developments happening in artificial intelligence and AI and so forth right now, How have you had to change your cultural approach as a CEO of a fintech, of essentially a startup?

26:03Brett King: How has that changed you in terms of the way you manage people and work in that environment? Brett, you know, I do get that question all the time because I came from a pretty big place. And, you know, I was a little bit surprised to see that there were some things that weren't that different, No matter how big an organization you work in, you're dealing with a relatively small number of people every day. And your job is to bring together and motivate and direct high-performing teams. And that's what I do at Hyperlayer with my partners and my colleagues. We go to battle every day. And our objective is to serve our customers and to win.

26:43And, you know, I grew up on a trading floor. That's what you do on a trading floor. I did that in different roles at Morgan Stanley. Of course, the scale is different. But you know, Brett, there is a difference. And the difference is, you know, you didn't worry very much about the survival of Morgan Stanley. You did maybe for a couple of weeks in 2008. But broadly speaking, you never had to worry about that. And a lot of things just happen because you are working at Morgan Stanley. uh and when you're in a in early stage company uh you got to earn it every day people don't return your calls as quickly as they used to and uh uh you know you got to think about funding down the road and you got to think in the next customer is critical uh so you know every everything the highs are higher and the lows are lower at a at a startup than they are at mortgage daily Yeah.

27:32Brett King: So for Mr. Rolls, your partner, you guys say you work very well together. But tell me about the dynamic in terms of the day-to-day operations, how you've divided responsibility. Well, that's quite simple. Paul is still the smartest guy I've ever worked with. And I've had the privilege of working with some pretty smart people in a 30-year career in global financial services. and he is our chief architect he is our visionary he is the one who invented most of the revolutionary features that are hyper layer as a architectural and technology matter and he continues to be our big thinker on how to evolve it and where it's going and really my job is all the commercial elements i run the business i build out the client strategy i fund the company all of that stuff so So he continues to lead the vision and I effectively try to monetize it.

28:29Brett King: So, you know, great answer. Let's talk about what's happening in the space right now, particularly in terms of artificial intelligence. We just had a member of Anthropics senior team leave and go on CNN and say that, you know, these guys, if we don't slow down AI, they're going to, you know, it could be the extinction level event for humanity. But one of the messages that keeps coming up, and it's only really been in the last year or so that we've heard this, it's been an academic consideration previously. But now we're on the clock. Now it's a timeline of when it's going to happen, which is both artificial general insurance, artificial general intelligence, which, you know, if you believe Sam Altman and his team or Jensen Huang, we're already there in terms of broad cognitive performance.

29:24Brett King: And then the second piece that sort of leads from this is the ability for AIs to code themselves, this term that we use, which is recursive self-improvement. So if we take a model like Anthropic today, probably about 60 % of the previous or the current model's code base was built by a previous model of Anthropic. It was very good at coding. and where this has really amazing implications is that these models are going to go on this sort of exponential improvement in terms of quality of code and therefore their abilities over the next few years. The labs, the frontier labs are all saying that what we see in the public domain right now is only a part of what is possible with the next iterations, the research models they have and so forth.

30:20Brett King: And this is why some people are saying we need to slow down, because it's scary that the capabilities of these models are insane. So this is obviously going to drive a lot of changes. And what's your picture in terms of how quickly that this type of AI capability that can solve math proofs and uncover new sciences and potentially end disease in a decade and all of this, how is this going to be implementable or how's it going to affect the fundamental fabric of financial services and say an industry like healthcare, which is extremely heavily regulated, but is still based on a lot of code that if we apply the same technology to could be radically improved in a very short period of time.

31:12Brett King: So I know it's a long question, but where do you see these advancing AI technologies? How do you see them reshaping our industries themselves? That is quite a question. And I certainly have some opinions on on this um but you know i think that we first have to start with some of the challenges just to kind of keep it real and some of the stuff you're talking about one of the things that i think we're running into with the big banks um as far as their ability to devote resources to innovation um is uh you know thanks to mythos um they have an extraordinarily long list of vulnerabilities that they have to patch that they didn't know they had six months ago.

31:59And these are very obscure vulnerabilities. But as you have already said, the power of Mythos a few months ago to exploit them was unveiled. And now, as you've said, these models have gotten stronger and stronger. And so, you know, I think any legacy organization, including banks, is spending an enormous amount of time trying to react to the vulnerability risks. There's a hump we get over and all of a sudden the code will not be vulnerable because it'll be written by these agents to a very, very high standard. I think the question, Brett, for me that we always come back to in our company and we are a heavy user of AI in all of our functions and absolutely in all of the code that we write is, you know, it isn't the case yet that AI understands the business.

32:50It isn't the case yet that AI knows what question to ask. And even when you're solving a maths proof, the problem was put to the AI and then the AI hammered through the solution, right? AI did not conceive of the question. And I think when we look at financial services, we look at our own approach. We take pride in the fact, and I give Paul most of the credit here, that our entire approach, the question we asked to solve the problems we're solving for banks in hyperlayer was a different question that came from many, many years of deep expertise in banking and finance. So I think this question about will anybody be writing much code?

33:35No, no, definitely not. Will agents and AI be transforming the way a lot of the work gets done? For sure. But the question is, I think, and I don't claim to have the answer, when is it that AI is going to be so good that it will be better at knowing what questions to ask than you and I? how are you using ai in your daily routine personally i i kind of i kind of use it for everything um um it it powers any presentation i have to give it it does all of my research um uh it is in fact how we run the company there's not a single person in the company that frankly not that i have to push very hard but is allowed to do their job without um the assistance of our agents.

34:26We're in the business of signing commercial contracts. We need far fewer lawyers than we used to. We write tons of code, and it's not us writing it. It's agents writing it. So we use it for everything, Brett. But by the way, the AI we have access to still needs to be seriously monitored and reviewed. It makes a lot of mistakes.

34:50Brett King: right? Yeah. I mean, the mistakes or the hallucinations, as we call them, they are getting, they're getting obviously smaller. I mean, I've been using AI now. Yeah, I was one of the first users of OpenAI and had been obviously experimenting with primitive models and deep learning before that. But, you know, now, like just even, you talked about generating presentations and slides, this is something that you can do with AI from scratch far faster than you ever could before. Absolutely. It's pretty cool. Absolutely. In terms of operating structure of hyperlayer and how you think of this operationally, building out an orchestration layer capability, for example, this is the other side of it.

35:44Brett King: Yeah, I've got a great technology I can bring to your bank, But you're going to need the organizational flexibility to absorb this. When you guys are doing your sales process and in that process of onboarding a new client to Hyperlayer, how are you educating the team in terms of how best to use this technology? that's a great question and and really we look at hyper layer as in a sense um we look at what it's doing for the bank above in other words what are the business outcomes the bank is trying to to achieve um what is the customer and product functionality we're enabling and and then and and in many respects if you haven't had a programmable account um uh and ledger capability you also probably may not know how to use it.

36:40And so, you know, not only do we deliver these capabilities in this functionality, but we deliver a lot of the intelligence on what to do with it. And so, you know, people like me who've spent our careers in banking, and we have, I have many colleagues in the company who are former bankers and are deep experts on how to apply this capability to business banking and family banking and the coming together of wealth management and everyday day banking. And of course, now, as you talk about a lot, agentic banking. So we have a capability to go in there and really advise on how to leverage and monetize hyperlayers capabilities in your business.

37:19And then there's the bit below, Brett. I mean, we are, you talked about onboarding, you know, you know, fintechs, listen up, right? You better know what you're going to be asked by a large bank, certainly. And, you know, we had to build our platform and this was one of the harder bits. Again, this I think is a little bit of a moat with AI. How do you build a platform that's environment neutral? It can be on-prem. It can be in your private cloud. We can host it. How do you build a platform that is data schema neutral? You don't have to tidy up all your data sets. We'll just plug into the ones you have and we'll sort it out.

37:52How do you create a platform that's ready for whatever API framework a bank is looking for? You cannot tell them to conform to ours. That doesn't work anymore. And then you need to be ready to get through Secarch and you need to be ready to get through procurement and all of these things. And again, I guess because we're older and experienced in these areas, we built the platform to get to yes very quickly with these big banks.

38:21Brett King: Well, that's, I mean, that's a huge achievement. I used to call the procurement departments, you know, we had, when we built MoveIn, one of the things we had to do, because it was so early, it was very difficult to source funding. So we ended up licensing our tech to banks. And, you know, I used to call the procurement departments the business prevention departments because, you know, it was so difficult to get through that process. But that, you know, for fintechs listening, I'm sure it's getting better, but it's also getting worse. Before we sort of get into the last part of the show, let's talk about the agentic side in a little bit more detail.

38:57From a structural perspective, you've got agents running,

39:03Brett King: but pretty soon we're going to be, you know, in financial services, we're going to have non-humans coming inbound into the bank. And this is going to happen from a smart contracting perspective on the SME and corporate side. It's going to be happening with personal AI agents doing more and more. We're seeing even just with the Apple, iPhone, next generation iPhone launch recently, we see a lot more emphasis on personal AI and having that guided lifestyle from an intelligent platform built into the devices around you. So pretty soon, we're going to have all of these agents flooding our bank with requests.

39:44Yeah.

39:45Brett King: But we don't have identity structures, digital identity layers capable of identifying the origin of all these agents coming in. For now, we're making the assumption that every agent comes from a human at some point in the chain. But as more and more agents flood the system, that's going to get harder to ascertain. So from an infrastructural perspective, when you're designing hyperlayer, how are you designing agent verification and agent identification in the architecture? So essentially, let me answer it this way. The number of sub-authorizations that a bank is going to have to process for transactions in an agentic world are going to be dramatically higher in number and volume and far more complex than they need to process today.

40:49And Brett, identity is definitely one of them. But we can make it even simpler, right? I mean, when you come in and your agent that you have identified, maybe that's very a simple case, like a 1.0 agent comes in and Brett, you've sent them out to buy you some Nikes. uh and you know today the bank has to approve brett's my customer yep um he's he's at jd sports in the uk okay that's an approved merchant and he's trying to spend 100 pounds okay great he's got 100 pounds in his account approved but brett's now just telling an agent to go to the internet and buy me some nikes um and you're not showing up necessarily from a specific merchant the bank's got to get used to that.

41:34Maybe you've shown up with a set of merchants. You're showing up with an item at a SKU level. We need to approve that. You've instructed your agent to conform to maybe some delivery protocols. I want my shoes tomorrow, not the next day. I've got to approve that. And yes, Brett, you're going to get to this identity challenge as well. And how are the banks going to, the banks are going to need essentially what we call multi-layered agentic firewalls. And in English, what we ultimately really do is we process, we orchestrate, pre-authorize, and execute conditional rule sets in real time. When you're talking about all the decisions that a bank is going to have to approve in order to prove an agentic transaction, identity, skew, all of these delivery protocols, all of these things, you are effectively asking the bank to process dramatically more conditional rules than they are processing today.

42:34And that's essentially what hyperlayer does in its simplest terms.

42:38Brett King: So how are you training that overarching decision-making, the traffic cop of hyperlayer that then becomes part of the orchestration layer of the bank? How are you training that to ensure that through that decision-making process that everything is authorized and safe. So effectively, what's interesting about the rules is you're writing the rules to say, listen, we've got to approve Brett, we've got to approve the SKU, we've got to approve the delivery protocols. That's relatively straightforward. What's more challenging is the latency and the scale of processing these rules. A limitation will be, and we can get into recursive a little bit, but a limitation is going to be how quickly can we write all the new rules we have to write, right?

43:33And the agents are going to have to start writing these rules. And one of the things I'm a little bit concerned about is how the regulatory environment and therefore the compliance processes in any bank, and I do think in the end, you know, NewBank and Revolut are going to be regulated. How are they all going to conform to this in a manner that is supported by the local regulators. And they're going to be slow. They're going to be slow and they're going to be behind. So while I think the anthropics of the world will deliver us the tools to do this much faster, there's going to be a handbrake from the regulatory community that slows us down a little bit.

44:10Don't forget, Brett, when I file my U.S. taxes, I still need a wet signature. And it's 2026.

44:16Brett King: So it's, but this is, and you know, you are operating in the US. So I guess that's a fair consideration. But at some point, and you know, what we have seen already is that the biggest digital banks in the world haven't come out of the US because the US was quite protectionist to the traditional banks. We still don't have a digital charter, you know, which all of the G20 countries except the US have digital charters. So, you know, there's definitely a regulatory response in the US already in respect to these technological advances that lends into that. But let's, you know, we are, I want to be respectful of your time and I want to sort of get some key understanding of hyperlayer before we wrap up.

45:10Brett King: How currently, you know, are banks learning about your technology. If someone's listening to the show today, where do they go to find out more about the need for this type of infrastructure agility that's required? What would you recommend to them in terms of sort of getting the information they require to assess your capabilities? And where can people go to find out more about Hyperlayer itself as well? Sure. Well, Brad, I always encourage people like, you know, I do think that banking and finance, that's super complicated, but it's not really. You know, at the end of the day, it's about even for new bank and Revolut, it's about the acquisition and retention of customers and deposits in order to do more lending.

45:57That's essentially what banking is all about. I've just described about 90 % of the business. And so, you know, my strong view is, you know, never forget, it's not about tech for tech's sake. It's about solving those business objectives. And where in that mission of the acquisition and retention of customers and deposits and doing more lending, where are you running into trouble? What are the solutions that you wish you could have that your core infrastructure is not giving you? Is it family banking? Is it accessing social networks? Is it business banking? Is it wealth management or the merger of wealth management and everyday banking?

46:34Is it connecting your traditional ledgers with blockchain ledgers? Is it, as you said, Brett, agentic banking? We're about to launch a new version of our HyperJar app, which I think might be the most agentic app in the world as far as a financial services app. Do you want that? That's a big claim. Yeah, it's a big claim. I'll happily talk to Nick and Revolut Air about that. That'll be kind of fun. But if you're looking for that, where are you running? Why are you not getting it? And usually the answer is my core infrastructure won't let me go fast enough. And that's why you need to come and talk to us.

47:09You can find us on hyperlayer.com and all that stuff.

47:13Brett King: Okay, great. Hyperlayer.com. So one final question for you today. I want you to map this out. In five years' time, you've got all these people on Hyperlayer. You're reshaping the financial services system. Where do you think Hyperlayer will be? And what will be the capabilities or tools that you bring to a bank in that environment? I think Hyperlayer is there, Brett. And you and I talked about this in our warm-up last week. I think we're still early in the evolution of blockchain and digital assets, as you and I talked about. It's way more than 99 % of the world operates today on traditional ledgers and traditional stores of value.

48:02But at some point, that's going to move and it's going to move quickly. And hyperlayer is going to be the bridge that connects all stores of value. And I think that this idea of my banking over here and my wealth management over there and my loyalty and rewards over here and I'm doing some crypto over there, that fragmentation that users experience, that will be will be a rapid consolidation. And I think some of these disruptors are going to play a big role in that. The Revoluts and the new banks, they'll probably lead the way. But don't count out the monsters, right? The big incumbents are going to fight back.

48:37And I think we're all going to be doing, we're going to look at money differently, not strictly in a digital asset sense, but the way in which we can monetize things and extract value will be a broader definition. And I think hyperlayer is going to be a critical part of the fabric that orchestrates across all of these disparate platforms.

48:56Brett King: A bit of prognostication from Elon Musk this week at actually Peter Diamandi's summit, where he said that he thinks the global economy will be 10x what it is today, thanks to AI. But that's because of tokenization of real world assets. So pretty interesting to think about that. The emergence of data savings accounts and data stores all fly into that. But, you know, I do a lot of work here in Dubai out of a very blockchain, crypto-oriented hub, and they're talking about RWA all the time, right? Real world assets. So, you know, and tokenizing that. So definitely it's on the cards. Rob Rooney, thanks for joining us on Breaking Banks today.

49:41Brett King: If you're listening to the show, please go check out Hyperlayer. You know, they got some really interesting tech for bridging the gap in terms of technical agility and what comes next with the growth in artificial intelligence and application of agentic AI in the financial services infrastructure layer. Rob, again, thanks for joining us. It was a pleasure, Brett. Thanks very much. Well, that's it for Breaking Banks this week. We'll be back with more. You'll hear from my co-host Jason Henricks and JP Nichols also as well. If you like the show, if you're a fan of the show, please tweet us out or share us on social media.

50:21Brett King: share some of these clips on Instagram and on LinkedIn. But tell us what you'd like to see next. Tell us about some of the areas that you're interested in hearing about the developments of, or if there's people in particular in the fintech space that you'd like us to talk to. That's it for Breaking Banks this week. We'll see you again next week for another episode of the number one fintech podcast in the world. That's it for another week of the world's number one fintech podcast and radio show, Breaking Banks. This episode was produced by our US-based production team, including producer Elizabeth Severins, audio engineer Kevin Hirsham.

51:00Brett King: If you liked this episode, don't forget to tweet it out or post it on your favorite social media, or leave us a five-star review on iTunes, Google Podcasts, Facebook, or wherever it is that you listen to our show. those actions help other people find our podcast and in return that helps us build an audience that can be supported by sponsorship so we can continue to provide you with our award-winning content every week thanks again for joining us we'll see you on breaking banks next week