London Fintech Scene Booming

- November 22nd, 2016

London’s fintech community is still alive and well despite Brexit fears.

The European Digital City Index (EDCi) lists cities in Europe that are entrepreneurs in the fintech industry. The EDCi 2016 is based on skills, access to assets, business environment, digital infrastructure, market and mentoring. London leads and Stockholm is second.
Lastminute.com NV (SWX:LMN) is one of the more established companies on the index, headquartered in London. This is listed as a ‘unicorn’, a billion-dollar startup, that helps lead the way for others. Year-to-date the booking website has seen 4.58 percent gains.
Investors should look out for food delivery service Deliveroo, expected to be an IPO prospect. As such, their financials are unknown but it has raised a massive €442.8 million in funds. In contrast, this is a scaleup, a rapidly-growing firm with a minimum of 10 employees.

Brexit

The data however does not take into account the results and consequences of Brexit, reflecting statistics that were compiled before the vote. In voting ‘leave’, Britain likely diminished London’s talent pool in a ripple effect akin to the Trump effect on tech workers. Indeed the NYSE Fintech Index PR (INDEXNYSEGIS:NYOMFTX) hit a historic low in the aftermath of Brexit. 


But while the US is traditionally restrictive, the EU and particularly the UK are active when it comes to supporting growing startups and new companies on the block. Banks are opening up to the fintech market. The UK regulator has been championing this direction for many years; since the recession the Financial Conduct Authority (FCA) has shifted support from bankers to innovators.
Financial technology will always find a home in London, thanks in part to sandbox, a meeting place for CEOs and officials to discuss thoughts, free of regulations. Backed by policy-makers, the program gets projects off the ground that might have had cut or suspended funding, due to the referendum.
Tech is showing confidence in the capital so investors should too and not be discouraged by the doom and gloom forecast by analysts post Brexit. Facebook has announced its UK expansion by 500 staff and Google plans to add 3,000 to its London workforce.
Don’t forget to follow us @INN_Technology for real-time news updates! 
Securities Disclosure: I, Emma Harwood, hold no direct investment interest in any company mentioned in this article. 
 

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