Peak Platform: it's not a ceiling; it's the pivot to innovate

I recently came across an interesting piece in FT Adviser suggesting we may be approaching 'peak platform’ due to the rise in mergers, consolidation, and players exiting.

My problem is that history shows us that people often mistake "peak" for the end of growth. Declaring 'peak' often signals an upcoming acceleration in innovation. These moments aren’t ceilings—they're pivots.

In 1894, during what could be called the 'peak of calling peak,' an American physicist and Nobel laureate famously declared, 'The more important fundamental laws and facts of physical science have all been discovered.' Since then, we’ve made thousands of discoveries, including quantum mechanics, DNA structure, and recently, the God particle.

Peak moments typically mark the transition from old thinking to the birth of new, innovative thinking and solutions.

The Tech Industry: From Phones to Pocket Computers

Take the smartphone. By the mid-2010s, many declared we had reached “peak smartphone”—the market was saturated, and innovation seemed to have plateaued. But rather than peaking, smartphones evolved from communication devices into essential hubs by which we run our lives.

It’s true; there are only so many ways to innovate in communicating with someone. However, true innovation occurred when we reimagined what smartphones could do. Everyone now has in their pocket, or bag, the equivalent computing power of the world’s supercomputers of the 90’s, much more than just a communication tool.

Instead of just making calls, smartphones are now central to our digital lives, connecting wearables, fitness trackers, gaming machines and even smart home systems. P1 is part of this transformation, too, offering innovative services like Lombard loans via our app. Instead of phones merely making calls, they became a hub of our digital lives.

So, while the old notion of the phone seemed to reach its limit, the smartphone's potential only expanded.

This shift underscores an important lesson: the so-called “peak” often reflects outdated or limited thinking. What comes next is usually not the end but a reimagining.

Online Retail: The Fall of the Old Guard

The rise of online retail in the early 2000s created giants like eBay and early Amazon. Again, by the mid-2010s, some argued we had reached "peak e-commerce," predicting limited further disruption. But then, newer models emerged, surpassing these early incumbents by innovating how people shop and having a laser focus on a target market.

For example, once the dominant force in online marketplaces, eBay is being overtaken by platforms like Etsy, Vinted and Depop, which cater to younger markets and focus on more curated, community-based shopping experiences. We’ve seen AI-driven clothing giant Shein take clothes shopping, manufacturing and marketing to another level. Similarly, Amazon evolved into more than just an online retailer—it became a tech company, launching services like Amazon Web Services (AWS), and Prime.

The Investment Platform Shift

In the investment platform space, we see similar forces at play. The M&G sale, the Scottish Widows merger, and talks of consolidation, may feel like we’re approaching “peak platform.” However, Seccl ’s insightful Gradually, Then Suddenly report, with a brilliant forward by David Ferguson , outlines that we’re on the verge of a transformation. Platforms like ours are automating processes and focusing on open, API-driven integrations, which offer more agility than legacy systems - facilitating our recent win for Leading Innovation Platform. But it’s not just automation and integration; like with the smartphone, we’re trying to reimagine what platforms can be for advisers and their clients, helping you meet the challenges of your business - like making Lombard Loans available via our app for clients - and not just be an admin tool.

The platforms that adapt will thrive, just as Vinted has by targeting a type of buyer and seller, or smartphones did when they pivoted from mere phones to computing hubs. Likewise, those who cling to older models will become the next Blackberry or Blockbuster—giants of the past, eclipsed by those embracing the future. And it’s not just me saying it; clients increasingly expect technological innovation.

Peak as a Pivot Point

Ultimately, “peak” moments are often for the incumbents. These perceived limits are usually reflections of technological restrictions or an outdated way of thinking about a service or product.

While we may not see a full 'Blockbuster' moment for all incumbents, those who fail to innovate will inevitably face declining market share.

This email is my peak of marketing in financial services this week, so it's time I pivot to marketing green veg and the benefits of sleep to my two small children...have a good weekend.

Harry Webster

P1 Investment Services 

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Here's what else we've been up to...

• Our CEO was on a great podcast chatting about the origins of P1 from an advice firm, building a business, how not to get got in #paralysisbyanalysis. List here
• We recently supported a new initiative by ClientEarth and CarbonTracker on the FCA consultation on climate disclosures for oil, gas and coal companies.