London Technology Week – the FinTech race

By all accounts, London Technology Week was a resounding success. What started off as a small event geared for 10-20 events in and around London, eventually grew to 200+ well attended events spanning 5 days in some rare English summer sunshine.

Such popularity was evident at the London FinTech event, which took a panel style approach in trying to answer the question of “Is London leading the Global FinTech Race?” To which the answer was a resounding “probably”.
Bathed in sunshine (and success)

Since the Olympic Games, it seems tourists, businesses and entrepreneurs have been flocking to London. And London wants to keep it this way, on the lookout for the next Bill, Steve or Mark. The only dampener was thinking, as I looked out across the Thames on the 6th floor of 2 More London, bathed in glorious sunshine at 8.30am, “can’t summer always be like this in London?”. Sadly not, but at least the glorious image was preserved for the New Yorker standing next to me.

Although FinTech was the subject of the talk, many of the discussion points could be attributed to start up businesses in technology generally. Entrepreneurship has certainly seen a boom in recent years. Whereas 20 years ago, university leavers were looking towards more traditional job roles such as lawyers, bankers and doctors, the combination of a tough job market and highly publicised success stories in the tech field seems to have given the title of “Entrepreneur” a lot more credibility then it may have had before. Certainly the success of accelerator programs such as Level39 and Startupbootcamp suggests this is very much the case.

Part of London’s success is also likely to be attributed to the ease a company can be started in the UK. You can be up and running with a UK company within 20 minutes. Being at the centre of a global banking sector must help too. And it seems that not only is entrepreneurship attracting young university leavers, but also disillusioned bankers, lawyers and other “City” workers, often taking significant pay cuts in order to pursue dream jobs.

Challenges ahead…

That is not to say that starting up a business in London is easy. High business rates and developments costs mean that if you have an idea, bringing that to fruition can be an expensive process. Moving part of your operations abroad can save a lot on development and office space expenditure.

Inevitably, given the subject matter, talk turned to banks and the difficulties in dealing with them. There certainly seems to be a lot of frustration, with three year adoption cycles for technology not being uncommon. Contract lawyers would also attest to the frustration of dealing with banks, with start-ups having to contend with extremely unfavourable terms that simply won’t be negotiated on. There was the feeling that banks need to be more collaborative with start-ups in order to really drive the FinTech scene forward.

Seemingly sensing that the talk was turning very “anti-bank”, others came to rally, arguing that regulation was the source of the blame and that ultimately, there is very little the banks can do until the regulators loosen the shackles.

Overall, the London FinTech scene seems to be in good shape. Although other cities will inevitably start to catch up, Hong Kong and Singapore being seen as the main candidates for competition in the next five years, there’s nothing wrong with having a good head start!