The latest group of fintechs selected for Tech Nation’s programme for early stage companies contains a diverse group in terms of sub sectors and regions of the UK.
The UK government-backed startup network also released data putting the UK at the top of the European fintech tree.
It has selected 31 fintechs as part of its latest cohort, with companies in the insurance, regtech, open banking and digital ID sectors included. There is also a diverse regional spread this year, which saw a 20% increase in applications from last year, with a total of 60% of new members from outside London.
Fintechs from cities and towns including Sheffield, Belfast, Edinburgh, Colchester, Bracknell, Manchester, Cardiff, Bournemouth, Newport, Glasgow, Guildford and Nottingham are included.
The companies, which on average have raised £3.3m and employ 18 people, will take part in the six-month programme to support their growth.
Data from Tech Nation revealed that the UK fintechs received the most venture capital investment in Europe: $2.5bn has been invested in UK fintech companies so far this year. In comparison, German fintechs raised $1.09bn and Swedish fintechs have raised $1.06bn in the same period.
The UK also has 22 fintech unicorns, companies worth $1bn or more, compared to six in the Netherlands, four in Sweden, three in France and three in Germany, said Tech Nation.
Liam Gray, fintech lead at Tech Nation, said the latest cohort will introduce insurtechs to the programme. “This cohort will also be the most geographically diverse group of fintechs we’ve ever had, with 60% located outside of London, highlighting the growing prevalence of regional fintech hubs.”
Tech Nation received 143 applications in total.
Read more about fintech
- The government has launched an independent review of the financial technology (fintech) sector, aiming to help ensure that the sector continues to grow and succeed.
- Huge increases in UK fintech investment over the past three years has seen the sector explode, but most of the activity is still concentrated in London.
- Fintech apps have seen a surge in take-up in Europe over the past week, as people adapt their lifestyles to cope with limitations on mobility amid the Covid-19 pandemic.
The successful applicants include a diverse range of propositions. For example, London-based lender Portify has developed financial services for people in non-standard employment and financial backgrounds, including flexible workers, to help them access financial products they wouldn’t normally qualify for.
In Edinburgh, Aveni uses natural language processing technology to provide customer support in the wealth sector.
Manchester-based open banking fintech BankiFi Technology offers SMEs and the self-employed tools to automate admin tasks.
Digital ID is based in Credas, Wales, offering identity verification using multiple technologies, including biometric facial recognition.
Women heading up companies
Judge Catherine Wines, co-founder and director of WorldRemit, was surprised by the regional spread and the number of women heading up companies. “What was also striking was the increase of such businesses set up outside of London and by women,” she said. “No doubt the Tech Nation Fintech programme contributes to their development.”
Tim Levene, CEO at venture capitalist firm Augmentum VC, said that despite the challenges posed by Covid-19, the innovation in Fintech continues. “It has been particularly pleasing to see the strength in depth not just by areas of focus, but by geography, too,” he added.
According to recent research from Tech Nation, UK digital tech services exports dipped between 2018 and 2019. In its Unlocking global tech report, the organisation urged UK technology businesses to maintain and build international trading relationships to build back better from Covid-19.
Tech Nation’s latest cohort fits the bill, with plans to expand internationally, and 39% setting their sights on the US, 23% on Germany, 16% on France, 13% aiming to expand into the Netherlands and Australia.