|
 London's "Silicon Roundabout" has become one of the top hubs for
financial technology - or fintech - where start-up firms are
launching products to bypass traditional banks with phone apps and
websites, or help financial firms adapt to a digital era.
Investment in fintech firms in Britain and Ireland swelled to $623
million last year, more than double the $264 million seen in 2013
and representing 42 percent of fintech investment in Europe,
according to research by consultancy Accenture released on Thursday.
Although the United States continues to attract the lion's share of
fintech investment, London has established itself as Europe's
fintech hub and the pace of growth had accelerated this year,
start-up firms and bankers told Reuters.
The Silicon Roundabout area around Whitechapel and Shoreditch claims
to be the third-largest technology cluster in the world, after San
Francisco and New York. And with most top banks and much of the
world's trading on its doorstep, London's tech hub has put more of
its focus on financial products.
"Right now, London clearly has an edge" over other fintech hubs,
said Sean McCormack, co-founder of New York start-up Stockfuse,
which creates gaming platforms that simulate a trading desk and help
banks evaluate and recruit trading talent by using behavioral
analysis.
"It's noticeable that the financial institutions here are very eager
to hear what entrepreneurs and start-ups are doing, because they've
seen a little bit earlier that it's something they need to catch on
to," McCormack said.
Stockfuse is among 10 firms picked for an "accelerator" program run
by Barclays in east London, which provides advice, access to bank
executives, facilities and seed funding. Four of the 10 firms in the
15-week program are from overseas, and start-ups from 64 countries
applied for a place.
'TAKE NEXT RISK'
It is one of several such programs in London, including Accenture's
FinTech Innovation Lab which is backed by more than a dozen banks.
In return, banks supporting these kind of schemes potentially get
access to new technology and expertise.
[to top of second column] |
Banks have also sets aside tens of millions of dollars to invest in
fintech firms and to spend on in-house technology development.
While Berlin, Stockholm and Amsterdam are also trying to lure
fintech entrepreneurs, investment in Europe is dwarfed by the United
States, which attracted about three-quarters of the $12.2 billion of
global fintech investment last year, which was more than triple the
funding seen in 2013, Accenture estimated.
Europe, by comparison, attracted 12 percent.
Silicon Valley, home to some of the world's biggest tech firms and
thousands of start-ups, attracts a deep pool of investors and
benefits from close links between academia, investment and business,
as well as a history of successful entrepreneurs.
London start-ups are successfully finding investors, and so are
established firms like Transferwise - a four-year-old online money
transfer group that raised $58 million in a January funding round
that valued it at about $1 billion.
It is funding for mid-sized tech firms where the U.S. market has an
advantage, industry experts said.
"You need more medium-sized exits (in London), where the engineers
and the middle-level people and the entrepreneurs receive enough
money so that they take the next risk," said Mike Laven, CEO of
Currency Cloud, a money transfer firm.
"Once you have enough activity those things start to happen ... it
comes from time."
(Editing by Pravin Char)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
