Over the past few months the news has been dominated by the B word. We have witnessed a political stalemate that has embarrassed a country previously known for its economic pragmatism. But, all is not lost.
The London economy for centuries has shown itself to be resilient and innovative in times of crisis. The fintech industry in London has continued to show record levels of investment and growth; being driven since the start of the year by positive news coming out of the key players including OakNorth, Monzo and Nutmeg.
A Look at the Stats
There are 7 fintech unicorns in London (companies with a valuation over $1billion). That’s nearly a quarter of all unicorns globally. London has also received 39% of global fintech venture capital funding, almost double the next city on the list (Berlin with 21%).*
Furthermore, London tech firms raised £1.8 billion in venture capital and public listings last year. London based digital banking unicorn Revolut ranks among the top ten largest global venture capital deals of 2018 with a fundraising round of $250 million!
Essentially, we see from this that despite all the uncertainty about Britain’s place in the world, the London fintech industry is successfully striving to be top of the tree. The question one has to ask is WHY and HOW an industry that should be directly affected by this political quagmire, is clearly, at least so far, weathering the storm.
Let’s look at some of the explicit reasons behind this….
The History and Legacy
For a number of reasons, London has been a global financial centre for centuries. A major one being geography; the city’s location allowing it to be one of the few places you can administrate financial transactions globally (from Hong Kong to New York City) in a single working day. English is also still the international language of business, and from the 1980s onwards (thanks Maggie), neo-liberal economic policies have pushed London as a place to base your bank, law or insurance firm.
A Growing Tech Hub
Investment in the Silicon Roundabout is paying off, with London becoming a growing location of choice for coders and techies from across the world. Over 30% of jobs in the UK's fintech industry are for IT-related roles, compared with 24% in 2017. This is particularly clear when you see that hiring for IT roles has increased 74% in London’s unicorn companies.**
The Creative Culture
London, as anyone who lives here will know, is BRILLIANT! It has a mix of culture and commerce that brings a buzz of energy that very few cities can match. It is the centre of government for the 5th largest economy on earth, as well as having a world famous theatre, music and art scene. In short people want to do business here as when they are done with business, there are huge opportunities to have fun.
So… even with the looming dread of the B word, London has a bright fintech future.
*Source Robert Walters
** Source Business Insider
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