Banc De Binary CEO Oren Laurent Opens Up on Binary Options
Interview by Susan Wright
Binary options are relatively new to the financial market, but the surge of their popularity cannot go unnoticed. The all-or-nothing nature of the options simplifies trading and gives traders greater control over their risk exposure. Banc De Binary is a company operating in this area and emphasizes customer service and employee expertise to assist clients in their trading.
I sat down with CEO of Banc De Binary, Oren Laurent, to discuss the emergence of binary options and the success his company has seen since entering the market.
Tell us about yourself first. What is your management style? Where did you go to school and work in the past?
I have always been fascinated by financial markets. Even as a child I’d rather watch the financial news than Nickelodeon. My family wanted me to study medicine, but when I told them I had been accepted to study economics, they grudgingly accepted that their dream of having a doctor in the family was over.
I networked while I was at college and was offered a position at NAF Hedge Funds as soon as I graduated. It was there that I learned how the markets really work. You can definitely learn a lot at college, but there is no substitute for hands-on experience. Once I felt I had absorbed as much as I could at NAF, I went to work for Infinity Private Investment Funds–just before the financial crisis hit in 2008.
My management style? It’s simple, really. Banc De Binary is a very big operation. We employ just over 250 people worldwide and that number is growing every day. To micromanage the activities of so many people would be a waste of time and counter-productive. I take a broad view of the business and concentrate on strategy, new markets, and strategic partnerships. I trust my management team to hire the best people and get the best out of them. That said, I do like to build relationships with all of our employees–my door is always open if anyone has a suggestion about how to improve any aspect of the business.
Tell us how your company started and when.
Banc De Binary started as a direct result of the 2008 financial crisis. I worked on Wall Street in the years leading up to the meltdown and was appalled at the recklessness of the “respectable” financial institutions. A lot of innocent people lost everything because of the criminal negligence and greed of the so-called financial “elite”. The financial markets have always been a closed shop and inaccessible to outsiders, which is why people needed the brokers who ultimately ended up costing them everything.
I wanted to change all that and, fortunately, I was young and naïve enough to think I could succeed.
My vision was to open the financial markets to everyone, not just experienced traders. It was around this time that the SEC green-lit binary options – financial instruments where investors just have to predict the direction the price of an asset like gold or a company stock will take, as opposed to the old ways of investing where traders try to profit from price direction and magnitude. It was a real Eureka moment. I knew immediately that the simplicity of binary options, if properly presented, would change the nature of investing forever. A group of us then set up SpotOption – a company that now provides the #1 platform for trading binary options online. Once that was up and running and the platform was in place, I started Banc De Binary. That was on the 15th of January 2009. In the beginning it was just me and three others, all fresh-faced and idealistic young brokers who wanted to make a difference.
Tell us an interesting story about your business. Were there any “wow” moments? Anything funny or unusual?
That was the summer of 2011. Our projections were for 10,000 client accounts by the end of 2011. We’d doubled that number by June.
What does your company sell?
Banc De Binary provides the platform and support for investors to trade binary options. Binary options are relatively new investment vehicles that simplify the trading of currencies, commodities, company shares and the major world indices. We’ve stripped the act of trading down to its very essence; and the only thing we’ve added is certainty. Let me explain: with traditional trading, be it buying the shares of a company or regular forex, there are two variables in play. One, will the price of the asset go up or down? Two, by how much will the asset’s price move? To generate satisfactory returns, an investor has to be right on both counts. With binary options we have completely removed one of the variables – magnitude. All an investor has to do is correctly predict the direction the price of an asset will move over a given time period. We’ve boiled the financial markets down to a simple choice between two possibilities: The price of an asset will either go “up” or it will go “down”.
The certainty I referred to earlier is the return on investment. With binary options traders know – before they enter a trade – precisely how much they stand to gain from a successful investment. Average returns are between 60 and 80 percent – most commonly around the 72 – 75 percent mark – and some offer returns of up to 500 percent. It’s the simplicity, transparency and game-changing profits of binary options that will see this industry overtake online forex in the next few years – indeed we are already seeing signs of that happening.
Which companies do you consider to be competitors?
Our position as number one in the binary options industry is now secure. We were the first to market and have really capitalized on that. Banc De Binary enjoys such excellent brand recognition that we don’t really see meaningful competition existing within our own industry. Instead we are focused on making our mark on the broader online investment landscape – I want to see the popularity of binary options overtake forex and CFDs, for instance.
What makes your products and services better than competitors’ offerings?
I have to credit Banc De Binary’s people. Our brokers are far and away the best in the business. When clients sign up for a Personal Broker account they are in incredibly safe hands. We have structured the business so it is completely customer-centric, particularly in the client-facing roles. The customer service and brokerage team are incentivized to make our clients’ experience with Banc De Binary as user-friendly, transparent and profitable as possible. It’s this ethos that sets us apart and has enabled us to win awards for Best Broker, Best Customer Service, Best Platform, Best Security and back-to-back World Finance 100 awards.
Are you planning an IPO?
Not at this stage, but we don’t rule it out for some point in the future.
Where do you see the company in five years in terms of revenue and profitability?
It’s difficult to put a dollar amount on the business five or ten years from now. Our growth to date has exceeded our wildest expectations and it is set to continue. One thing is for sure though; the binary options industry is still in its infancy. If the early signs are anything to go by, binary options will be a multi-billion dollar industry by 2020.
What forms of marketing do you use to attract clients?
Our target demographic is very internet savvy, so at the moment 90% of our marketing is online with a lot of PPC. We are also starting to develop our offline presence and brand awareness through traditional media, charitable works and sports sponsorships as the company grows.
How big is the company in terms of its workforce?
Banc De Binary employs over 250 people now and I anticipate that number doubling by the first quarter of 2014. The core people are in place and now it’s just a matter of scaling things up in a controlled way. It is very tempting to “panic hire” when you are enjoying the growth we’ve seen, but you have to take a longer-term view. I’d rather turn down new client accounts than fail to service them properly. This is what I mean about changing the way we do business. A Wall Street brokerage turning down clients? It’s unheard of, really.
What are the biggest growth catalysts (new technology, new offerings, etc.) for you right now? Tell us about any patents or other IP.
We are constantly refining our trading platforms and developing new features to enrich the trader experience. Customer service and innovation are at the heart of what we do at Banc De Binary. I can tell you that we are set to release something very special later this year, but I am afraid you are going to have to wait and see.
Have you faced any regulatory hurdles, or anticipate any in the future? Explain.
Not really. Even though this is a relatively new financial instrument, the regulatory bodies seem to appreciate the transparency as much as our clients.
Is there an announcement you’d like to make?
Well as a thank you for this lovely interview I’d like to offer your readers a gift. If they open a client account with Banc De Binary and quote “Investment Underground” I’ll match their first deposit one-for-one. Tell your broker Oren sent you.
This interview was originally posted on Investment Underground – http://investmentunderground.com/6882/featured/banc-de-binary-ceo-oren-laurent-opens-up-on-binary-options/