I didn’t vote for Brexit. But is all this doom and gloom justified? If we take away the big black cloud under which the banks are supposedly jumping ship to other European capitals, what do we really find?
Not a sinkhole of empty City offices, but a growing wave of global fintech companies poised to leap into the spaces that traditional banks might or might not vacate.
All this talk of fleeing is ignoring the potential and opportunities it could uncover. Traditional banks might be looking elsewhere today, but we only need to pay attention to office lettings to realise that London is already the place to be for tomorrow’s leaders.
Fintech start-ups are demonstrating that they are ready and willing to lay down permanent roots in the UK capital.
In FinTechCity’s latest annual Fintech50 list, which profiles the European businesses that are transforming financial services, 31 of those listed are based in London.
Ten to watch from the 2017 FinTech50 list
- AQMetrics (Kildare, Ireland)
- Behaviosec (Stockholm, Sweden)
- DarkTrace (Cambridge, U.K.)
- Figo (Hamburg, Germany)
- MarketInvoice (London, U.K.)
- Meniga (Rejkyavik, Iceland)
- Onfido (London, U.K.)
- Qumram (Zurich, Switzerland)
- Revolut (London, U.K.)
- Suade (London, U.K.)
Not only that, but fintech companies are taking office space across London that previously went to much more traditional tenants, such as banks or accounting firms.
Although co-working is growing in popularity, more established fintech companies are proving themselves willing to go down the traditional leasing route. Buoyed by the London expansion by tech behemoths Google and Amazon, fintech businesses are starting to give traditional banks a run for their money on their own doorsteps.
For example, Transferwise, Algomi, iwoca and eToro have all set up base in the City and its surrounding area or Canary Wharf.
Kontor recently secured office spaces for Monzo and iZettle, two fintech companies looking for space in traditional banks’ neighbourhoods. We’re working with a whole range of fintech start-ups looking to follow in their wake, signing for permanent offices that really demonstrate their faith that London remains the top place to be.
Office space is often considered a barometer of the wider economy, so a lot should be read into the sheer number of premises they are taking across the capital.
Fintech start-ups are ready to lay down permanent roots
Through these office leases, these start-ups and growing SMEs are demonstrating that they are willing to spend their hard-earned cash on permanent homes in the city they have chosen to live in.
And they certainly have cash to spend. More than half a billion dollars was poured into UK-based fintech companies in the first half of 2017, up 37% on the same period in 2016, according to trade body Innovate Finance.
London is the top spot
London-based companies such as Revolut, Funding Circle, Starling Bank, Atom Bank and Curve have raised a billion dollars between them to date, breaking records with investment levels and speed of growth - proof that investors are undeterred by Brexit.
This level of investment is drawing the crowds to London from overseas. Start-ups that have their origins in other countries are looking to set up London offices and the city’s incubators continue to churn out new and exciting companies daily.
Although European cities such as Berlin, Madrid and Paris are pushing their credentials as start-up hubs, the UK’s concentration of talent, pro-business culture, transparent regulatory system and evident appetite for investment are keeping London in the top spot. People who are touting Frankfurt as the next big fintech hub clearly haven’t toured Frankfurt yet.
So why are we worried? Yes, Brexit is bringing disruption, but from disruption the future emerges. The glorious historical streets of London could soon be filled with buzzing innovations and inventions. If, instead of fearing empty offices, we focus on encouraging new and exciting tenants to move in, London will retain its status as the global fintech headquarters.