I’m a bit of a nerd for architecture and engineering (ask my family about bridge designs). The great Chicago architect, Louis Sullivan, coined the phrase “form follows function.” The design of a building should be based on its intended function and the environment in which it is built. J.P Morgan’s new headquarters at 270 Park Avenue will open soon and is an imposing building. A powerful exoskeleton rises from the Manhattan bedrock, weaves through the underground Grand Central railway lines, and cradles the building above street level, with the occupied floors wrapped in bronze glass and steel. There is some striking imagery from the architects, Foster Partners.

Meanwhile, the pillars of J.P Morgan’s payments strategy were being discussed across the street. Last week I had the pleasure of attending the J.P Morgan Payments Innovation Day (and the associated Analyst and Partner day). Two days, where the Global Payments leadership team from all the payments lines of business spent time with clients, solution partners, and a select group of industry analysts/advisors. Capped by a fireside chat with Jamie Dimon, these interactive sessions shared strategic viewpoints on macro-economics, new payments initiatives, solution partners, and the enabling technology building blocks. And yes – even the new building. Questions, feedback, and 1:1 conversations/debates were welcomed.

Some initial, personal, perspectives.

Rails are plumbing. On the immediate practical side, ISO 20022, Fed ISO migration, nor new real-time payment rails were specifically discussed – and that’s fine. In my view, none of these are products are solutions – but they are (important) bits of payments architecture. Being connected to RTP or FedNow is a a building block, not a product offering. It is clear to me that the bank doesn’t regard payments as merely a collection of money movement rails, it is a strategic capability that connects to all clients and across all elements of the business. The value is not in the rails, but how they are leveraged along with other building blocks of payments capability and adjacent solutions (my words).

Partners are partners, not vendors. From my time at Microsoft, I appreciate the role and value of a partner ecosystem to scale solution reach and expansion. This is what Big Tech does well. Banking, for the most part, not so much. The goal of participating in an ecosystem of banks and FinTechs is to provide additional scale and broader reach, and to remove the friction of banking (and other financial) services for clients. Simply put, to make the “opportunity pie” and its slices bigger for those who participate. J.P Morgan’s approach is similar – the partners are not necessarily vendors to the bank, but firms that are embedded in the bank’s ecosystem to deliver enhanced client value.

Virtual accounts play an important role in driving scale. Several executives have experience at ecommerce giants. Coincidentally (or perhaps not), some of the biggest drivers of new payment rail volume are ecommerce transactions and marketplace payouts. Related to that, one other statistic that stood out was the number of active virtual accounts compared to physical accounts. The statistic was shared under NDA, but it is a very, very big number. A couple of years ago I wrote about challenges with traditional virtual account adoption and that the open ecosystem and embedded finance opportunities to grow VA (Virtual Reality to Actuality: the Way Ahead for Virtual Accounts). In addition to traditional complex treasury use cases much of the virtual account adoption is by the aforementioned ecommerce and marketplace giants managing virtual accounts for their customers.

A looming data storage crisis. On the more esoteric side, there was a fascinating (and slightly mind-bending if I’m honest) discussion about the challenging future of traditional digital data storage (cost and data center capacity), and how biotechnology can be used to convert digital bytes to DNA in drastically smaller form factors. Perhaps a post for another day.