Why FinTech Is Taking London By Storm

According to a report by Accenture, Europe’s FinTech scene has grown by 215% to $1.48 billion with the UK accounting for 42% of that and London alone attracting £343 million of investment, three times as much as in 2013. Not only that, but CB Insights, a venture capital database, has found that of the $1.5bn (£950m) in venture capital funding raised for British technology firms in the first half of 2015, almost a third went to London’s fintech sector.

So, Why Are FinTech Startups Attracted To London?

London is an established financial centre with over 40,000 financial services companies as well as home to Global or European headquarters of many market leaders, so with that wealth of expertise on the doorstep it’s easier for startups to tap into it. Many FinTech startups were formed by men and women working in London’s financial industry during the recession, who have now gone on to mentor other young FinTech startups.

Another key reason is London’s location. Sitting at the nexus of the European, US and Asian time zones makes communicating with countries that collectively generate 99% of the world’s GDP very easy.

There are over 44,000 people working in London’s FinTech sector – more than New York City or San Francisco’s Silicon Valley. Add the 155,600 digital tech professionals and you have an almost unlimited supply of talent on your doorstep.

The British government are advocates of startup businesses but they seem particularly eager about helping FinTech startups. They recently announced Fintech 2020, an initiative which aims to accelerate the expansion of the financial technology industry to position the United Kingdom as the principal global hub for FinTech by 2020. When launching the initiative Prime Minister, David Cameron, said:

“This government wants the UK to be the leading FinTech centre in the world, that’s why, at the Summer Budget, we appointed a Special Envoy for this fast growing sector.”

Success Stories

TransferWise

TransferWise is one of the most famous examples of FinTech that’s taken the world by storm. Creators, Taavet Hinrikus and Kristo Käärmann, built TransferWise to stop people transferring money across currencies being overcharged, a problem they themselves had faced. Launched in 2011, the company now supports 300 currencies and has transferred £3Billion since its inception.

Funding Circle

Funding Circle, a peer-to-peer lender that foceses exclusively on small businesses. In just five years they’ve already facilitated over $1Billion being loaned.
You can find a great video of Funding Circle’s CEO Samir Desai s speaking at Wired’s Money 2015 conference earlier this year here.

Accelerating Your FinTech Startup

London has a number of accelerators to help startups and here are just a few that focus on FinTech specifically:

• FinTech Innovation Lab (run by Accenture)
• Startup Bootcamp FinTech
• Barclays Accelerator (with TechStars)
• Level 39

But if an accelerator isn’t for you, there’s still lots of help available, such as Angel Investors like FinTech Circle or venture firms such as Santander InnoVenture and London and Partners, a resource set up by the Mayor of London.

The fact that companies like Barclays and Santander are embracing fintech startups means it’s only a matter of time until the technology ends up in the hands of consumers. So, if you have a FinTech idea that you’ve been sitting on, now is the time to do something about it!

_______________

Sharing is caring so please share this post. Thank you!