In London, It’s Enterprise FinTech’s Time To Shine


Analysts are beginning to notice a trend in London: last year, venture capital funneled into FinTech startups based in the city. This year, the space is likely to see a slew of merger deals, reports by Finance Magnates said Thursday (Jan. 14).

Among the most poignant trends of this emergence is the rise in B2B FinTech players, analysts said. The site spoke with London-based venture capital company Illuminate Financial and one of its partners, Mark Whitcroft.

Whitcroft noted that while the media tends to focus on investments in the B2C financial technology and services space, enterprise FinTech is a rising star in the city, with a FinTech space that employs 44,000 people — four times that seen in Silicon Valley and a figure more on par with New York, according to reports.

“The areas of real opportunity are around the market drivers: cost, control, capital and compliance,” Whitcroft said in an interview. He added that B2B financial tech startups are centering around providing banks with new technologies and said, this year, funding is expected to shift from angel investments to later-stage backing for these companies.

[bctt tweet=”‘The areas of real opportunity: cost, control, capital and compliance.'”]

According to Magister Advisors’ analysis, blockchain and payments will be popular destinations for venture capitalists looking to place their bets on enterprise FinTech players.

“Payments has gone from ‘boring’ to ‘disruptive’ in a very few years, and we see a range of larger players, from PSPs [payment service providers] to alternative payments giants continuing to broaden their offerings as they seek to capture margin and customers,” said Magister Advisors Managing Partner Victor Basta in the report.

This year, reports said, B2B payments will likely capture new attention, while mergers and acquisitions are also slated to hit London’s enterprise FinTech sector.

London saw $1.6 billion worth of investment in the first nine months of 2015, reports said, while U.K. M&A value rose 90 percent year on year, according to Ernst & Young figures.