The FinTech50 2015 The fifty hottest FinTechs in Game changer.

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Game (9) Insly (17) Algomi (27) InvoiceSharing (17) BehavioSec (15) Ixaris Systems (11) changer. (9) Klarna (11) BUX (27) Kreditech (17) Byhiras (15) LendInvest (30) Agiliti™ from Fiserv is a comprehensive, pay-as-you-grow, banking software-as-a-service solution that helps Calastone (28) Mambu (24) you deliver differentiating experiences for your CommuterClub (28) mBank with efigence( 25) customers -- quickly and cost effectively. Let us ( ) ( ) take the worry out of your IT infrastructure, Benchmark 16 Merit Software 25 while you do the banking. CrowdCube (28) Nutmeg (31) (10) (18) agiliti-fiserv.com Currency Cloud OpenGamma Cybertill (10) Osper (25) Darwinex (29) Parmenion Capital Partners (31) DueDil (16) Squirrel (31) Earthport (10) Stockomendation (32) Ebury (29) Sybenetix (18) eToro (29) Symetrics (18) The Hot Ten ETRONIKA (23) SynerScope (19) Aire (23) (32) Fidor Group Tink cfinancials Five Degrees (24) TransferWise (12) ClauseMatch Agiliti from FundApps (16) Traxpay (12) Derivitec Essentia Analytics Funding (30) Trunomi (19) Finexkap GoCardless (11) Trustly (12) Finlytics investUP (30) (13) Guidants WoraPay SavingGlobal © 2015 Fiserv Inc. or its affiliates. (24) (13) © 2015 Time Inc., used under license. Holvi ZooZ Sonovate 4 The FinTech50 2015 panel

Pierre Suhrcke Director, Acorus Capital

Santiago Tenorio Director Innovation & Roy Vella Payments, American Express Managing Director, V2 Ltd

Nasir Zubairi Venture Partner, FinLeap

Debu Purkayastha Entrepreneur in Residence, Octopus

Gareth Lodge Dave Birch Senior Analyst, Celent Consult Hyperion Travers Clarke-Walker Managing Director EMEA, Alex MacPherson Fiserv Head of Ventures, Octopus

Ian Morgan Richard Peers Christian Erlandson Chris Skinner Industry Director Financial Banking Industry Lead EMEA, European Leader, Chairman, The , Google Microsoft Dun & Bradstreet Services Club 5

Alex McCracken Managing Director, Venture Services, Silicon Valley

James Cameron Associate, Accel Partners Nicky Cotter John Chaplin Co-Founder, ICON, Chairman, Ixaris The FinTech50 & FinTechCity

Alex Batlin Group CTO Applied Innovation (R&D) & Market Research Director, UBS

Conny Dorrestijn Shiraz Partners Jon Barrett Product Adviser, Fearghus Barkley Silicon Valley Bank James Le Brocq FinTech50 Research Adviser, Ensygnia

Andrew Vorster Eddie Harding Menno Van Leeuwen Julie Lake Technology Foresight Head of FinTech, Team Lead Innovation Centre, Co-Founder, The FinTech50 Consultant ICON Corporate ABN AMRO & FinTechCity Anyone can have an idea, it takes vision to make it happen

Now, more than ever, the world needs entrepreneurs with skill, drive and imagination – people who are ready to turn their innovative ideas into successful businesses. Every year Barclays helps entrepreneurs of all kinds realise their ambitions and create a future that’s better for everyone.

We are proud of the Barclays Accelerator, powered by Techstars, helping FinTech startups fast track their businesses.

Visit barclaysaccelerator.com to find out more

Barclays Bank PLC is registered in England and authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered No. 1026167. Registered Office: 1 Churchill Place, E14 5HP.

7 The FinTech50 2015 Julie Lake and Nicky Cotter Founders, The FinTech50

Here’s a big financial forecast to begin with. According to Silicon Valley Bank research, FinTech will be one of three sectors predicted by the CBI to deliver, between them, a whopping £300bn to the UK economy by 2020.

In anyone’s money, that’s a phenomenal trajectory by the sector since we launched the first FinTech50 in 2012.

Back then we had just 150 FinTechs on our long-list. This year we considered just shy of 800. 2012 was the year of the ‘start-up’. In 2015, we not only saw even more potential game-changers than ever before, we are also witnessing the birth of the billion-dollar FinTechs.

It is these characteristics that distinguish this year’s 50 from previous ones. In a nutshell, it’s a tale of new and ingenious technologies (of course), but also of maturity and scale – in a truly global sense.

It is also very much about Europe – if, admittedly, our geographic scope owes more to Eurovision than to Google Earth. The UK dominates the list with 27 , but it’s now impossible to ignore the rise of FinTech cities across Europe who are emerging as powerhouses of innovation – and collaboration. FinTechs from The , and make up 30% of this year’s list. , Finland, Ireland, , Lithuania and Poland are also represented.

We have grouped this year’s list into four mini sector parcels: Banking, Platforms, Payments and Big Data/ Risk. Platforms and payments predominate this year, but the 2015 50 also highlights hotspots such as analytics, , microfinance, aggregation and virtual currencies.

A lot of people helped us to deliver this year’s list: our partners and sponsors, our ever-collaborative global community of innovators, financial services, VC and global techs. And, of course, our always-insightful panel (see p4-5) who had the very tall order of reducing a long list of 800 inspirational FinTechs to the 50 who appear in this book.

If you would like to get involved in our 2015 programme, we would love to hear from you.

fintechcity.com “Payments are moving from the domain of the to next generation platforms that can combine acquiring, processing and payment gateway services under one roof, across all channels, globally. This need is driven by the global nature of the internet and eCommerce, the need of merchants for a smooth service with maximum conversion and the desire of consumers for simplicity of transacting.”

Jan Hammer, Partner, Index Ventures Payments 9

Adyen

KEY PEOPLE CEO & Founder: Pieter van der Does Co-Founder: Arnout Schuijff FOUNDED Blockchain 2006 KEY PEOPLE SECTORS CEO & Founder: Nicolas Cary Payments Co-Founders: Ben Reeves, HEADQUARTERS Peter Smith , The Netherlands FOUNDED ON 2011 @Adyen SECTORS ON THE WEB Payments adyen.com HEADQUARTERS London, UK Adyen provides a single platform to accept payments anywhere in the ON TWITTER world through any sales channel. @blockchain The enables businesses ON THE WEB to process payments across online, blockchain.com mobile, and POS (Point-of-Sale) with over 250 payment methods Blockchain is a platform in 187 transaction currencies. New and currently the provider of the payment methods this year include world’s most popular Bitcoin wallet, SEPA direct debit, POLi, Interac, the most widely used Bitcoin APIs DragonPay, and . Clients and the most popular block explorer include Airbnb, Spotify, Groupon, and search engine. It also has Vodafone, Mango, SoundCloud, what is widely recognized as the Indiegogo and KLM. strongest, most trusted brand in Bitcoin, with 2.5m users. 10

Earthport

KEY PEOPLE CEO: Hank Uberoi

Currency Cloud FOUNDED 1997 KEY PEOPLE CEO: Mike Laven SECTORS Payments Founder: Nigel Verdon HEADQUARTERS FOUNDED London, UK 2012 Cybertill ON TWITTER SECTORS KEY PEOPLE @Earthport Payments & FX CEO & Founder: Ian Tomlinson ON THE WEB HEADQUARTERS FOUNDED earthport.com London, UK 2001 ON TWITTER Earthport provide white-label cross- @currency_cloud SECTORS Payments Software border payment services delivering ON THE WEB high volumes of low value payments currencycloud.com HEADQUARTERS efficiently, cost-effectively and Knowsley, UK transparently. In December 2014 Currency Cloud is a B2B platform ON TWITTER it announced a global partnership providing administration and @cybertillretail with Ripple to offer real-time control features to automate ON THE WEB international payments capability, the entire payments lifecycle of cybertill.co.uk (Ripple is the open-source payments businesses. The company delivers protocol for free and instant Cross-Border Payments-as-a- Cybertill has developed an exchange of any form of money or Service, providing access across award-winning fully hosted value). Earthport’s clients include a multitude of payment networks multi-channel cloud-based retail two of the top five banks globally and exchange rate providers. software product, offering retailers and four of the top 20 US banks It also provides comprehensive a fully integrated end-to-end including Merrill administration and control eCommerce, EPOS and Enterprise Lynch, Western Union and HSBC. features and fully automates Supply Chain Management solution. the entire payments lifecycle In 2014 Cybertill teamed up with from compliance, pricing and MercuryPay to bring their cloud- beneficiary management, through based POS system to the US. The execution and receipt to settlement company’s software is currently and reporting. installed at over 4,000 locations with over 4,500 Points of Sale and 250 websites across the UK, Europe and the USA. 11

Ixaris Systems

KEY PEOPLE CEO & Founder: Alex Mifsud Klarna Co-Founders: William Lorenz, Damon Hart KEY PEOPLE

FOUNDED CEO & Founder: 2002 Sebastian Siemiatkowski Co-Founders: Niklas Adalberth, SECTORS Victor Jacobsson Payments GoCardless FOUNDED HEADQUARTERS 2005 KEY PEOPLE London, UK SECTORS CEO & Founder: Hiroki Takeuchi ON TWITTER Payments Co-Founder: Matt Robinson @ixaris HEADQUARTERS FOUNDED ON THE WEB Stockholm, Sweden 2011 ixaris.com ON TWITTER SECTORS @Klarna Payments Ixaris offer a range of co-branded payment applications that ON THE WEB HEADQUARTERS enable enterprises and financial klarna.com London, UK institutions to capitalise on the ON TWITTER growing market for prepaid Klarna is one of Europe’s leading @GoCardless payment solutions. Its payment providers of payment solutions ON THE WEB applications provide access to for eCommerce. The company gocardless.com electronic payments for consumers separates buying from paying, unwilling or unable to access credit allowing buyers to pay for ordered GoCardless is a UK-based service card services. goods after receiving them. At the that allows smaller merchants to same time, Klarna assumes all credit easily set up interbank transfers for and fraud risk for e-stores so that customers. The company makes sellers can rest assured that they collecting by Direct Debit easy for will always receive their money. The everyone, from one-man bands to company is in 16 countries and used multi-nationals throughout Europe. by over 45,000 merchants. Clients Clients include, Crowdcube, include ASOS and Marks & Spencer. Funding Circle and The Guardian. 12

Traxpay

KEY PEOPLE CEO: John Bruggeman TransferWise FOUNDED 2012 KEY PEOPLE CEO & Founder: Kristo Käärmann SECTORS Payments Co-Founder: Taavet Hinrikus HEADQUARTERS FOUNDED Frankfurt, Germany 2010 ON TWITTER SECTORS @Traxpay FX ON THE WEB HEADQUARTERS traxpay.com London, UK Trustly ON TWITTER Traxpay’s platform allows KEY PEOPLE @TransferWise businesses in a supply chain, to CEO & Founder: Carl Wilsson ON THE WEB make payments to each other. The Co-Founders: Joel Jacobsson, transferwise.com platform combines secure, flexible, Lukas Gratte real-time 24/7/365 electronic FOUNDED TransferWise lets expats, foreign payments with any and all 2008

students and businesses move structured and unstructured data SECTORS money globally. During the last 12 related to the transaction. Strategic Payments months the company has introduced relationships and investments new mobile platforms, including iOS include Commerzbank, MasterCard, HEADQUARTERS Stockholm, Sweden 8 (iPhone +iPad) and Android. The and Software AG. In the last 12 business also rebranded, redesigned months, Traxpay has expanded into ON TWITTER their payment flow and launched the US market. @trustlyEN their first national TV campaign. ON THE WEB The company has been valued at trustly.com close to $1bn. Trustly is an online PSP (payments- services-provider) offering both B2C and C2C payments. Its payment methods were created for mobile devices and offer cross- border payment functionality, which makes the platform well suited for international eCommerce on mobile and tablet devices. The company covers 57 banks, serving over 67m customers. 13

WoraPay

KEY PEOPLE CEO & Founder: Aurimas Bakas Co-Founders: Vaidas Adomauskas, Nerijus Celkonas

FOUNDED 2012

SECTORS Payments ZooZ

HEADQUARTERS KEY PEOPLE Vilnius, Lithuania CEO & Founder: Oren Levy ON TWITTER Co-Founders: Eyal Kotler, @WoraPay Ronen Morecki

ON THE WEB FOUNDED worapay.com 2010

SECTORS WoraPay is a mobile payments Payments platform for mWallets that enables payment for goods and services. HEADQUARTERS Kfar Saba, Israel The company is used by a number of financial institutions and ON TWITTER mobile wallets to provide seamless @ZooZpayments payment solutions in restaurants, ON THE WEB petrol stations, taxis, entertainment zooz.com arenas, tickets and coupons, donations and account top-ups. ZooZ offers a secure, and easy- The company is integrated with the to-use payment solution for largest Horeca POS cashier system eCommerce websites and mobile in the Eastern Europe, which is apps. The company provides operational at over 35,000 locations. retailers with a set of tools that enables them to increase shopping conversion rates, reduce shopping cart abandonment and grow their businesses based on smart consumer insights generated by the platform. 2014 saw the company partner with , ’s popular online-payment service. Clients include IKEA and Groupon. “We expect to see more and more collaboration between start-ups and financial institutions, as the ‘disruptive’ ideas coming from outside the financial world hit diminishing returns. Start-ups and Banks will need to work together to share talent, expertise, distribution and traction to create viable innovation.”

Mariano Belinky, Managing Director, Santander Innoventures Big data, business intelligence & analytics 15

BehavioSec

KEY PEOPLE CEO: Neil Costigan Co-Founders: Olov Renberg, Kristofer Nygren, Hans Peterson

FOUNDED 2007

SECTORS Biometrics,

HEADQUARTERS Lulea, Sweden

ON TWITTER @behaviosec Byhiras ON THE WEB

behaviosec.com KEY PEOPLE CEO & Founder: SAM Lusty

BehavioSec uses behavioural FOUNDED biometrics to verify identity, 2011 measuring typing speed, pressure, mouse movements and voice SECTORS Buy-side patterns for authentication purposes. BehavioSec will flag up HEADQUARTERS any unauthorised access to any London, UK mobile devices or computer. Clients ON THE WEB include the sci-fi military research byhiras.com organisation DARPA and a number of high-profile financial institutions. Byhiras is an innovative solution to enable institutional investors better to manage the entire life-cycle of their allocations and investments and to comply with increasingly stringent governance and regulatory reporting requirements. Byhiras has developed highly scalable technology which also provides a range of risk and performance analytics. Through Byhiras, buy- side institutions, their employees, suppliers and clients are able to collaborate on investments in a secure environment. 16

Credit Benchmark

KEY PEOPLE CEO: Elly Hardwick Founders: Donal Smith, Mark Faulkner FundApps FOUNDED 2012 DueDil KEY PEOPLE CEO & Founder: Andrew White SECTORS KEY PEOPLE Finance, Banking, Credit Risk, FOUNDED CEO & Founder: Capital Markets, Risk Management 2010 Damian Kimmelman HEADQUARTERS SECTORS London, UK FOUNDED Compliance, Asset Management, 2011 Hedge Funds ON TWITTER SECTORS @CreditBenchMark HEADQUARTERS Big Data London, UK ON THE WEB HEADQUARTERS creditbenchmark.org ON TWITTER London, UK @FundApps ON TWITTER Credit Benchmark is increasing ON THE WEB transparency in the financial @duedil fundapps.co markets by creating a totally new ON THE WEB information resource. The company duedil.com FundApps and its flagship product, pool forward-looking estimates of Rapptr, provide pre-trade and the creditworthiness of sovereigns, DueDil aggregates public data post-trade compliance to the banks, corporates and funds on companies from a variety of investment fund industry. Rapptr produced by the world’s largest databases, then uses it to create is a cloud-based compliance engine financial institutions, unlocking an new metrics to indicate how solvent with a web front end for monitoring untapped but immensely valuable or successful the business is. It is UCITS, contractual restrictions, data source in a highly scalable way. the largest source of free private internal guidelines as well as major company information in the UK and shareholdings, short selling and Ireland. DueDil data powered the takeover rules in 82 jurisdictions new Investec Mid-market Index of globally. Clients include some 24,000 mid-sized UK companies. of the world’s largest investment banks, asset managers, hedge funds and institutional investors. 17

Kreditech

KEY PEOPLE CEO & Founder: Sebastian Diemer Co-Founder: Alexander Graubner-Müller

FOUNDED 2012

SECTORS InvoiceSharing Big Data, Information, Banking, Analytics KEY PEOPLE CEO & Founder: Jeroen Volk HEADQUARTERS Co-Founder: Vincent Prooij Hamburg, Germany ON TWITTER Insly FOUNDED 2013 @Kreditech KEY PEOPLE ON THE WEB CEO & Founder: Risto Rossar SECTORS Office Operations kreditech.com Co-Founder: Ando Kivilaid HEADQUARTERS FOUNDED Kreditech is a Big Data finance Rotterdam, The Netherlands 2014 company based on automated ON TWITTER SECTORS Big Data and machine learning @InvoiceSharing Insurance Software credit scoring. The company ON THE WEB extends to individuals in HEADQUARTERS invoicesharing.com real-time, using a fully automated London, UK credit scoring system and banking ON TWITTER InvoiceSharing is a financial backend infrastructure. It operates @insly_com services marketplace which enables independently from credit ON THE WEB 100% free electronic invoicing. After bureaus and traditional banking insly.com the company raised funding in 2013 infrastructure. In just 20 months, they went freemium – offering free Kreditech has scored more than Insly is a spin-off from IIZI Group digital invoicing to all suppliers. 1.5m individual loans. The company – the most successful insurance InvoiceSharing earn money when is at the forefront of the rapidly group in the CEE region. they provide additional services to changing consumer finance market. The company creates standardised purchasing departments. Premium Using 15,000 dynamic data points, insurance industry tools and ‘add-ons’ include, invoice financing, its technology is capable of scoring models that make buying and online payments and advanced everyone worldwide, including the selling insurance simpler and more reporting, as well as the ability to 4bn individuals without a credit profitable. Its cloud-based software connect with all and score. Funds can be paid out within enables clients to manage sales ERP systems. seconds to a credit card, bank from start to finish and administer account or NFC wallet, 24/7. all insurance policies. Clients include Volvo, AON, Dansk Bank and LHV Bank. The company hail from Tallinn, Estonia. 18

Sybenetix (formerly Investment Intelligence)

KEY PEOPLE Symetrics CEO & Founder: Taras Chaban Co-Founder: Wendy Jephson KEY PEOPLE

FOUNDED CEO & Founder: Martijn van Eck 2011 FOUNDED OpenGamma 2012 SECTORS Enterprise Behavioural Analytics SECTORS KEY PEOPLE Risk Management Software CEO & Founder: Mas Nakachi HEADQUARTERS Co-Founder: Kirk Wylie London, UK HEADQUARTERS ON TWITTER Breukelen, The Netherlands FOUNDED 2009 @sybenetix ON TWITTER ON THE WEB @SyTwits SECTORS Risk Management, Analytics sybenetix.com ON THE WEB symetrics.eu HEADQUARTERS Sybenetix’s Enterprise Behavioural London, UK Analytics platform is used by Symetrics’ flagship product, ON TWITTER leading hedge funds, banks and SyMath, provides institutional @OpenGamma asset managers to systematically investors with SaaS based risk ON THE WEB improve investment performance management software. SyMath can opengamma.com and “conduct management”. stress-test investment portfolios Behaviour profiling algorithms and using real-world economic OpenGamma develops financial real-time decision support tools, scenarios, protect portfolios for analytics and risk management enable investment professionals future risks, measure the effects software for the financial services to improve success rates, capital of adverse shocks on ROI and industry. Due to global regulatory allocation, selection and simulate human investment overhaul (Dodd-Frank, EMIR), timing. The platform is also used behaviour. Symetrics also aims to the need for standardised risk by compliance professionals to provide its technology to individual analytics and margin calculations automatically analyse all trades investors to enable them to manage will continue to grow, as firms look and flag up any suspicious activities their own portfolio and assess their to reduce internal IT costs and based on unusual behaviour – and risk profile independently. optimise their use of capital. Clients enable immediate investigation. include banks and four of the five Financial institutions use largest clearing houses in the world. Sybenetix to measure and manage skills, counter behavioural biases and poor conduct, to transform standards of performance and reputation management. 19

SynerScope

KEY PEOPLE CEO & Founder: Jan-Kees Buenen Co-Founder: Danny Holten

FOUNDED 2011

SECTORS Big Data, Analytics Trunomi

HEADQUARTERS KEY PEOPLE Eindhoven, The Netherlands CEO & Founder: Stuart Lacey

ON TWITTER FOUNDED @synerscope 2013

ON THE WEB SECTORS synerscope.com Data, Online Identity Management, Security SynerScope is a leading provider HEADQUARTERS of enterprise business analytics Dublin, Ireland products focusing on Big Data and Business Intelligence for the ON TWITTER banking and insurance industries. @trunomi Its technology is currently being ON THE WEB used in Claim Analytics by a number trunomi.com of large insurance companies, providing them with improved Trunomi’s platform helps banks’ insight into pricing, risk calculations on-board customers five times faster and operational processing. and at 20 per cent of the cost of SynerScope has partnerships with today’s manual process. It simplifies major companies, including SAP, KYC (Know Your Customer) capture Accenture, CGI Logica, IBM, Dell, and review, allowing organisations NVidia, and VCE (an EMC/Cisco/ to quickly conduct due diligence VMware JV). and create shareable digitised KYC datasets for each customer, with a full trail. On the map The 2015 50 by location

Knowsley GBR (1)  Llandudno  GBR (1)  Dublin  IRE (2) Amsterdam  NLD (2) 

Bristol GBR (1)  Exeter GBR (1)  Rotterdam  NLD (1) 

Eindhoven NLD (1)   London GBR (22) Breukelen  NLD (2)  

 Frankfurt DEU (1) 

 Payments  Big data, business intelligence & analytics  Banking & Finance  Platforms Lulea SWE (1)   Stockholm SWE (3)  Helsinki FIN (1) 

Tallinn EST (1) 

Hamburg DEU (1)   Vilnius LTU (2) 

Berlin DEU (1)

 Lodz POL (1)   Munich DEU (2) 

Limassol CYP (1)  Kfar Saba ISR (1)  “At the moment, FinTech innovation is a ‘white hot’ space. Established and emerging players are transforming the industry, increasingly designing products and services around the evolving behaviours and needs of customers and clients. One of the key accelerants driving this is the open innovation between large scale commercial entities and start-ups.”

Derek White, Chief Design and Digital Officer, Barclays Banking & financial 23

ETRONIKA

KEY PEOPLE CEO & Founder: K stutis Gardžiulis Co-Founder: Jonas Šulcas FOUNDED Fidor Group 2000 KEY PEOPLE SECTORS CEO & Founder: Matthias Kroner Banking FOUNDED HEADQUARTERS 2009 Vilnius, Lithuania SECTORS ON TWITTER Banking @EtronikaTweets HEADQUARTERS ON THE WEB Munich, Germany etronika.com ON TWITTER ETRONIKA develops solutions @ficoba for finance and online businesses, ON THE WEB helping financial institutions to fidor.de serve both retail and corporate customers better. Their e-banking Fidor is an online bank with a solutions combine banking and full banking licence in Germany, retail, personalisation and loyalty, offering mainstream retail and enabling banks to transform corporate banking products. Their their service offerings from being online platform includes virtual designed to fit the average customer currencies trading, social media profile to serving a personalised banking, Facebook and Twitter one. The service is available on payments. Available in Germany, multiple channels making the bank Fidor has expanded into the US, accessible anytime, anywhere. UK and Russia. 2014 also saw the company integrate with the Ripple payment network (Ripple is the open-source payments protocol for free and instant exchange of any form of money or value). 24

Five Degrees Mambu KEY PEOPLE CEO & Founder: Martijn Hohmann Holvi KEY PEOPLE Co-Founder: Bjorn Holmthorsson CEO & Founder: Eugene Danilkis

FOUNDED KEY PEOPLE Co-Founders: Frederik Pfisterer, 2009 CEO: Johan Lorenzen Sofia Nunes Founders: Tuomas Toivonen, Teemu SECTORS FOUNDED Hukkanen, Kristoffer Lawson Banking 2011 FOUNDED HEADQUARTERS SECTORS 2011 Breukelen, The Netherlands Banking, Microfinance SECTORS ON TWITTER HEADQUARTERS Banking @fivedegrees Berlin, Germany HEADQUARTERS ON THE WEB ON TWITTER Helsinki, Finland fivedegrees.nl @Mambu_com ON TWITTER ON THE WEB Five Degrees has developed a @Holvi mambu.com next generation core banking ON THE WEB software platform designed for holvi.com Mambu helps banks, microfinance existing banks as well as new ones. institutions, financial innovators The company provides a fully Holvi replaces traditional bank and digital banking disrupters to automated banking services hub accounts with a Pan-European reach the world’s 3bn unbanked. supporting any segment, product alternative, unlike traditional The company enables customers or channel through a rich middle- banks that are tied to a single to deliver essential and office environment, connected to country. Holvi completely replaces deposit products to individuals any (legacy) back-office of choice. bank accounts with a service that and emerging enterprises around Matrix, (the company’s proprietary offers a smart checking account. the world. In 2014, the company technology) offers an agile customer Full bank payments can be made, enhanced its core platform to centric architecture that supports both in and out, and all accounts provide end-to-end digital loan banking operations in a future proof have International Bank Account origination and scoring. manner, significantly lowering Numbers (IBAN) that enable cost whilst enhancing agility in seamless banking across Europe. the banking environment. Matrix The company has customers in is a proven fully automated (STP) 8 European countries. core business process management (BPM) banking solution ready for SaaS and (private) cloud setups. 25 mBank with Efigence

KEY PEOPLE CEO: Michał Panowicz

FOUNDED 2000

SECTORS Banking

HEADQUARTERS Lodz, Poland Osper ON TWITTER Merit Software KEY PEOPLE @mBankpl / @Efigence CEO & Founder: Alick Varma

ON THE WEB KEY PEOPLE FOUNDED mbank.pl / efigence.com CEO & Founder: Kerril Burke 2012 Co-Founder: Paul Burke SECTORS mBank is the first established FOUNDED Children’s Banking European bank to undergo a 1998 comprehensive, mass-scale, HEADQUARTERS SECTORS London, UK Bank 3.0 revolution of its direct Banking BPM Software channels including modern UI/ ON TWITTER UX of transactional banking, PFM, HEADQUARTERS @osper Dublin, Ireland video banking, transactional, real- ON THE WEB time marketing, social channels, ON TWITTER osper.com gamification and mobile banking @meritsoftware and is the leader of e-banking in ON THE WEB Osper offers a safe MasterCard Poland. Part of BRE Bank (owned merit-soft.com prepaid debit card with a simple by Commerzbank) it is currently the mobile banking app with separate 3rd largest retail bank in Poland in Merit Software is the industry logins for young people and parents. terms of number of customers. The leader in investment banking and All money on Osper is managed company also operates in the Czech broking operations’ receivables by a European regulated bank Republic and Slovakia. and payables processing and case and its mobile banking app creates management. Merit has recently visibility for parents and children developed a centralised matching on spending in real time. platform (“The Utility”) with a transactional-based business model and the ability to automate these processes on an industry-wide basis. In 2014 the company agreed an exclusive partnership agreement with one the world’s largest clearing houses for the global distribution of The Utility. “The concept of finance platforms will evolve in 2015 from the ‘supermarket’ model to an experience that is much simpler and more personalised to the individual. The key challenge will be building trust from clients that you as a business are ‘on their side’.”

Rob Moffat, Principal, Balderton Capital Platforms 27

Algomi

KEY PEOPLE CEO & Founder: Stu Taylor Co-Founder: Usman Khan

FOUNDED 2012 BUX

SECTORS Big Data, Trading KEY PEOPLE CEO & Founder: Nick Bortot HEADQUARTERS Co-Founders: Robbert Bos, London, UK Joost van de Wijgerd, Egbert Pronk ON TWITTER FOUNDED @Algomi_Ltd 2013 ON THE WEB SECTORS algomi.com Trading Gamification

Algomi combines Big Data with HEADQUARTERS Amsterdam, The Netherlands social networking to suggest trade opportunities between ON TWITTER investors and banks transacting @BUX_NL multi-million dollar financial ON THE WEB trades. The company’s flagship getbux.com product “Honeycomb” connects clients including professional BUX turns trading on the stock bond investors with the Big Data market into a game. The company’s repositories that Algomi installs mobile trading app bridges the gap inside global banks. With existing between casual gaming apps and offices in London and New York, traditional trading platforms. Users Algomi plans expansion in Asia. can start for free trading with funBUX, then play with real money via seriousBUX. Traders can compete against each other in BUXbattles and track the success of other users. BUXbattles are timed contests to see who can make the best returns. The company launched in the UK and The Netherlands and it plans to expand in Germany, and . 28

Calastone Crowdcube KEY PEOPLE KEY PEOPLE CEO & Founder: Darren Westlake CEO: Julien Hammerson Co-Founder: Luke Lang

Founders: Ian Taylor, Philip Goffin FOUNDED FOUNDED CommuterClub 2010

2007 SECTORS KEY PEOPLE SECTORS Equity Crowdfunding CEO & Founder: Petko Plachkov Trading Co-Founder: Imran HEADQUARTERS HEADQUARTERS Gulamhuseinwala Exeter, UK London, UK FOUNDED ON TWITTER ON TWITTER 2013 @Crowdcube @CalastoneLtd SECTORS ON THE WEB ON THE WEB Lending, Payments crowdcube.com calastone.com HEADQUARTERS Crowdcube is one of the UK’s most London, UK Calastone helps fund managers, successful investment crowdfunding providers and fund administrators ON TWITTER platforms, having raised more by automating funds processing. @CommuterclubUK than £50m for over 180 businesses The company has replaced the ON THE WEB from a 125,000-strong crowd of expensive and cumbersome point- commuterclub.co.uk registered investors. 2014 saw the to point approach to industry successful launch of Crowdcube connectivity, with a single one- CommuterClub offers low-cost loans Mini-Bonds and the Crowdcube to-many alternative connectivity to customers, allowing them access Venture Fund, Crowdcube is the network, that enables the industry to the big discounts offered by only crowdfunding platform and to reduce the cost of electronic season tickets or annual travelcards. the largest partner to be appointed transactions by 60%. In 2014 For example an Oyster Card for to the Government-backed London Calastone introduced a new the London Underground, can be Co-Investment Fund. structured products service in 30 per cent cheaper than weekly collaboration with Novia or monthly travelcards. Customers and Investec. get the savings but pay for them via a monthly instalment plan. The lender operates in partnership with the P2P site, Ratesetter, who provide the low interest rates. 29

eToro

KEY PEOPLE CEO & Founder: Yoni Assia Co-Founder: Ronen Assia

FOUNDED Ebury 2007

SECTORS KEY PEOPLE CEO & Founder: Salvador Garcia Co-Founder: Juan Lobato HEADQUARTERS Limassol, Cyprus FOUNDED 2009 ON TWITTER @eToro SECTORS FX, Lending, Currency Forecasting ON THE WEB .com HEADQUARTERS London, UK Darwinex eToro is the world’s largest social ON TWITTER trading and investment network, @EburyUK KEY PEOPLE offering traders easy access to the CEO & Founder: Juan Colón ON THE WEB currency, commodity and equity Co-Founder: Javier Colón ebury.com markets. In 2014 the company launched their mobile app for FOUNDED 2012 Ebury enables small and medium- traders on-the-go, offering over sized businesses transact and 200 plus including all of the SECTORS trade internationally. Companies FTSE stocks. Plans for 2015 include Trading, Brokerage, can finance their imports, make the launch of a brand new platform Asset Management, and receive payments in foreign which the business believes will be HEADQUARTERS currencies and hedge currency risk a game changer. London, UK in more than 120 currencies. In

ON TWITTER 2014 the company lent more than @Darwinexchange £1m to UK SMEs, growing the client base over 100% month on month. ON THE WEB darwinex.com On the currency side, they reached over £5bn in foreign exchange transaction volume. Darwinex (formerly TradeSlide) is a social trading broker and asset manager. Its trading platform has a tool that dissects a ’s strategy and rates it according to its risk, scalability, performance and experience. This allows other investors to view the risks involved with a particular . Plans for 2015 include a office to cater to the needs of their growing Asian customer base. 30

Guidants

KEY PEOPLE CEOs & Founders: Robert Abend, Funding Circle Thomas Waibel FOUNDED KEY PEOPLE 2012 CEO & Founder: Samir Desai Co-Founders: James Meekings, SECTORS Trading Andrew Mullinger HEADQUARTERS FOUNDED Munich, Germany 2009 ON TWITTER SECTORS @guidants Debt Crowdfunding ON THE WEB HEADQUARTERS guidants.com London, UK LendInvest ON TWITTER Guidants enables investors and KEY PEOPLE @FundingCircle traders to monitor, analyse and CEO & Founder: Christian Faes ON THE WEB discuss the financial markets, free of Co-Founder: Ian Thomas fundingcircle.com charge. The company enables users FOUNDED to select in the form of 2013

Funding Circle was created with over 30 widgets. Each widget has SECTORS a big idea: to revolutionise the one task such as displaying a chart, Crowdfunding outdated banking system and or giving direct access to a broker. HEADQUARTERS secure a better deal for everyone. The user can modify each widget London, UK The investors on the platform have according to their needs (size, since lent more than £300m to over content, appearance) to compile ON TWITTER 5,000 SMEs. 2014 saw expansion their personal market overview. @LendInvest in the US, the appointment of Clients and partners include, ON THE WEB Wall Street heavyweight Robert K Deutsche Bank, Commerzbank, lendinvest.com Steel (former deputy to New York DZ Bank, UBS, RBS, HSBC, ING mayor Michael Bloomberg) and a Markets, Goldman Sachs, BNP LendInvest is a P2P lending landmark tie-up with Santander, Paribas, Yahoo, CMC Markets. platform for residential and the first high-street bank to refer its commercial mortgages. It offers customers to an online P2P lender. a crowdsourcing alternative to The British Business Bank, 11 bank-backed mortgages. In 2014 the councils, a university and financial company was featured on the front institutions are all lending to page of the FT for completing the businesses via the platform. world’s largest peer-to-peer loan of £4.23m. LendInvest has completed over £100m of investment in mortgages through its platform. 31

Nutmeg

KEY PEOPLE CEO: Lee Cowles Founders: Nick Hungerford, Parmenion William Todd FOUNDED Capital 2010 Partners SECTORS PFM, Consumer Finance KEY PEOPLE HEADQUARTERS CEO & Founder: Richard Mein London, UK FOUNDED ON TWITTER 2006 @thenutmegteam SECTORS ON THE WEB Services nutmeg.co.uk Squirrel HEADQUARTERS Bristol, UK Nutmeg offers portfolio KEY PEOPLE management services to anyone ON TWITTER CEOs & Founders: Mutaz Qubbaj, with as little as £1,000 to invest @parmenionuk Emanuel Andjelic and has over 35,000 registered ON THE WEB FOUNDED users. Customer acquisition in parmenion.co.uk 2014

2014 put Nutmeg in the top 25 of SECTORS wealth managers in the UK, where Parmenion has developed the UK’s PFM, Employee Benefits the market is worth £500bn. The first automated online discretionary business is targeting 100,000 investment management services HEADQUARTERS London, UK customers by Q2 2015. Nutmeg platform. Parmenion’s online puts together portfolios to match CIP (Centralised Investment ON TWITTER customers’ attitude to risk. The Proposition) enables IFAs to @asksquirrel underlying funds are “passive” spend less time on administration ON THE WEB index trackers. The lower-risk fund and more time with clients, squirrel.me baskets have more of their money providing an efficient, cost- in bond funds, while the higher-risk effective service which has been Squirrel is a technology platform options favour share-based funds. recognised nationally through offering digital PFM (personal numerous adviser-voted awards, financial management) tools. including Defaqto’s 5 Star DFM Squirrel’s aim is to help people to (Managed Portfolio Service) 2014. fix their , foster financial Parmenion is the only UK platform freedom and end the need for to hold discretionary management costly credit cards. The company (managing investments) permission partners with employers to provide from the FCA. simple and intuitive tools to help their employees save, budget and manage their bills directly from their payroll, thereby helping staff avoid the payday loan and overdraft markets. 32

Stockomendation

KEY PEOPLE CEO & Founder: Paul Roberts

FOUNDED 2013

SECTORS Financial Markets, Platforms, Trading, BI

HEADQUARTERS Llandudno, UK Tink

ON TWITTER KEY PEOPLE @Stockomendation CEO & Founder: Daniel Kjellén

ON THE WEB Co-Founder: Fredrik Hedberg stockomendation.com FOUNDED 2012

Stockomendation is a stock-tip SECTORS aggregation and comparison site. PFM The company aggregates, compares and performance-monitors stock HEADQUARTERS Stockholm, Sweden tips from newspapers, investment magazines, financial websites, blogs ON TWITTER and newsletters, creating a ranking @tink of success and failure. The platform ON THE WEB creates accountability and facilitates tinkapp.com trust with access to tipster track records, helping retail investors, Tink is a mobile app that invest on the basis of a proven continuously collects, sorts and record of achievement. The platform analyses multiple data points about also allows institutions, financial a user’s personal finances and platforms and online to delivers it in a clean and simple deliver exciting stock tip content timeline. The aim is to show exactly to encourage trading. In 2014 the where a user’s money is going and company appointed Nick Ogden, how better to manage their money. founder and CEO of WorldPay, The company has over 200,000 as Chairman. users in Sweden, making it the largest third party app in Sweden. 2015 plans include European expansion. Derivitec provide cloud-based portfolio risk analytics, for derivatives practitioners. The service is on-demand pay- as-you go, allowing clients to scale their analytics costs with their needs. Clients include small Hedge Funds and mini prime brokerage firms. The company was established by a trio of senior technologists and equity strategists from Goldman Sachs, UBS and . derivitec.com

Essentia Analytics helps Hedge Fund managers continuously improve their performance. The company’s software applies behavioural finance principles and advanced analytics to trade, market and biometric data, and feeds it back to the fund manager in the form of actionable, personal insights. This enables them to improve their investment skills. The company is based in the UK with offices in NYC. essentia-analytics.com

Finlytics has developed a platform to help funds and investment institutions carry out some of their middle office functions more efficiently, including post-trade The Hot Ten reporting functions, control and analytics. The company’s platform not only transforms and controls the post-trade function, but it enables drastically reduced costs. Initially (our additional ones the company was established in 2006 as a joint venture with ABN Amro, but has since become independent. to watch in 2015) finlytics.com Finexkap is a web-based marketplace providing a web This year our panel looked at 800 FinTech companies solution to short-term capital funding. Bringing together across Europe, which made selecting just 50 a very tall SMEs and qualified investors, the company offers a order. To say that this year’s list was hotly contested short-term, flexible and paperless funding solution. In would not do justice to the debate. But if selecting fifty just a few clicks, SMEs can sell their receivables and gain was a tough call, we did all agree that these ten highly access to short-term funding with competitive advantages enterprising innovators deserved a special mention. compared to factoring solutions. finexkap.com Meet our Hot Ten: investUP is a debt and equity aggregator allowing Aire is aiming to change the way people are assessed investors to invest directly into crowdfunding on their credit score. Current credit models depend opportunities. UP integrates the debt and equity markets on past repayment patterns to calculate credit scores. enabling investors to have one free go-to point of access Any missing credit history and your score drops. New to the crowdfunding world. The platform allows users borrowers like students, migrants & expats can be to manage all their crowdfunding investments on the rejected for credit because they have a “thin-file”. UP platform. investup.co Aire’s credit scoring algorithm looks at deeper data- driven analysis to generate a score based on educational SavingGlobal, with its German brand “WeltSparen”, background, professional history and knowledge and provides a retail deposit brokerage platform, connecting understanding of financial risk. aire.io savers with the best deposit products from international banks via an online platform. The team, who all hail TIPERsm, by cfinancials.com, is a unique security from the financial services team at McKinsey, felt that indicator on 16 million financial products, which offers if various banks offer different interest rates on deposits a real-time & objective assessment on the quality of any that all fall under the same EU-wide deposit insurance financial product in the world. TIPERsm also ensures scheme, why not create a platform that would allow that the financial industry will meet 100% of the savers to seamlessly access these rates from the comfort requirements set out by MiFID II and is currently the only of their browsers. weltsparen.de solution of its kind which can help the industry to be fully compliant with the regulation. cfinancials.com Sonovate combines industry leading finance and back-office into an intuitive, simple to use cloud-based ClauseMatch is a cloud-based management application. Designed exclusively for the recruitment system for trading agreements in commodities and industry, the company provides the finance needed to financial markets. The company’s system makes it run contractors, with a bespoke technology platform easier to negotiate and conclude master agreements, offering office admin tools, such as payroll, invoicing thus improving the liquidity for OTC commodities and and a host of real-time reports ranging from financial derivatives trading. clausematch.com forecasting through to timesheets. sonovate.com Kemp Little FinTech: Solving technology law issues whilst they’re still in beta_ www.kemplittle.com/fintech.html [email protected]

At Kingston Smith, we have a dedicated team of FinTech accountants and advisers; our experience in both the technology and financial services sectors means we can advise our clients on all elements of their business operations. Offering a full spectrum of advice; from FCA regulatory compliancePMS 279 andPMS advisory 368 andPMS internal151 audit,PMS 2587 through to core audit, , accounting and Kingston Smith – work; we are trusted advisers who help our clients succeed, by understanding their business aims and objectives. understanding FinTech We have alsoPMS built 637 a strongPMS reputation GREEN inPMS the396 FinTechPMS 191 Tom Moore and Jon Dawson, Kingston Smith market for our tax planning services. We advise clients on how to operate tax efficiently and get the most For the last 90 years Kingston Smith has provided expert value from their business; ways in which business accountancy and business advice to start-ups through to owners might incentivise key staff, such as Enterprise multinationals. Today, we continue to help our clients Management Incentives and alternative share schemes; achieve their objectives. We work with a variety of advise on and implement schemes to ensure companies businesses across the FinTech sector including payment are attractive to external investors, such as EIS/SEIS; facilitators, data consultants, platform developers and and ensure other valuable tax reliefs, such as Research software providers. & Development, are not overlooked.

We understand that FinTech companies are different Our international ties also provide a unique offering to the average technology business as they also face in the marketplace, enabling our clients to plan for the scrutiny from the Financial Conduct Authority (FCA), move to multinational and global status; whether it is who authorise and regulate some of their activities. in the US, Europe, India, South America or elsewhere, Finding a trusted adviser who can assist throughout the Kingston Smith are fully equipped to provide expert whole business life-cycle, as well as on regulatory issues, advisory services in over 70 countries. is vital for the success of any FinTech company with plans for the fast growth we see in the sector. kingstonsmith.co.uk @kingstonsmith Kemp Little FinTech: 35

Surely it has never been easier to raise investment Solving technology law issues for FinTech? Well maybe. We are seeing plenty of seed money – £250k to £1m, plenty of Series B – £5m plus, but the big whilst they’re still in beta_ ugly void is in the post-seed investment – the ‘A’ round investors – £1m to £5m. www.kemplittle.com/fintech.html The life of an early-stage company remains a race to get to the next lump of and, without paying customers, a [email protected] seed investment does not last long – 10 to 15 months. For the entrepreneurs it is an absolute race against time. In that very short runway the seed funds need to get the fledging business to real demonstrable progress – fast – otherwise Smashing the Series A will be as elusive as a unicorn in the forest. Investors are happy to punt some small amounts of cash on the seed to try and prove a model and back an inspired through the entrepreneur, but then the ‘A’ round investors want hard evidence as the quantum of funds gets larger and the bets bigger. So what are the key points to smashing through the ‘A’ round and getting on that pathway to the big funds Series A and major investors?

Here’s what ICON sees as the five winning features to Alan Bristow and Eddie Harding, securing that ‘A’ round: ICON Corporate Finance 1. The entrepreneur – leadership, inspiration, vision, clarity – making FinTech, FinTech, FinTech, what used to exist before things happen out of nothing and inspiring people to come along with FinTech? The truth is it has always existed – now, you, from leading influencers in the market to interns – the best CEOs however, it has truly arrived and is having an impact few and founders inspire, excite and create belief in achieving the impossible. would have envisaged a few years ago. Charismatic leadership definitely helps in securing the ‘A’ round.

2. The focus – keep it tight yet agile, demonstrate and secure early wins A heady cocktail of slow moving traditional incumbents, from significant others in the market who have impact with investors. new innovators and disrupters, large markets to go after, Be prepared to react quickly to change the model, given entrepreneurial innovators winning with scale, smart people, smart instincts and initial reactions from the market. technologies, rejection of the status quo, the march of PMS 279 PMS 368 PMS 151 PMS 2587 the entrepreneurs, need for transparency, power to the 3. The traction – try and build momentum in the market, build a customer, failure of the incumbents to innovate, failure of presence, use social and business media to build a following. Metrics credit markets and, and, and… all rocket fuelled by digital do not need to be financial but whatever they are, they need to be connectivity and an easy to plug into global infrastructure, impressive and to demonstrate something is stirring. sending the traditional barriers to entry tumbling. 4. The revenues – perhaps the biggest single factor to securing the ‘A’ PMS 637 PMS GREEN PMS 396 PMS 191 round – the more success on the calibre, quality and scale of revenues The success of Monitise, Funding Circle, TransferWise, the bigger the likely round and the better the valuation. Revenues Currency Cloud, Zopa, Fidor, Klarna, iwoca, Five Degrees, provide investors with significant validation as to the investment case. eToro, DueDil, Crowdcube, Parmenion, SynerScope and many others across the FinTech landscape, has caught 5. The valuation – progressing from the seed round valuation is essential the mood of investors with high rewards for those brave and no money would be raised without demonstrable progress. However, enough to take the early bets. do not kill the round by overpricing – it is still very high risk capital and it’s the value of where the cash can take you that is the most important factor. There’s a lot of talk about all the money available for FinTech, and London’s position at the epicentre of The ‘A’ round is the hardest place to be to raise funds. international financial markets makes it the natural draw Get the fundamentals working and the Series A will be for early stage FinTech entrepreneurs and investors. competitive with investors and you will get the round away with the right amount of funds, with the right We have seen the rebirth of specialist FinTech VC funds, valuation. You then have the platform to crack on to the accelerators, incubators, startup camps, high net worths, next challenges and keep striving to deliver the vision. corporate seed funds, family offices, plus a significant number of new institutional funds emerging across Go on – smash it! Europe dedicated to FinTech. Many of the major US funds are also in London looking for the European gems. iconcorpfin.co.uk @ICONcorpfin 36 36

Unemployment and underemployment are high and this restructuring of the labour market has a Championing challenging impact on the global economy.

But with challenges come opportunities. entrepreneurship Opportunities to create environments that value and practise lifelong learning, encourage direct ownership, and promote responsibility of economic At Barclays we believe that entrepreneurship is a and societal challenges. vital component of any successful economy. If some industries are called the engine room of the economy, At a more granular level we need to create more entrepreneurial businesses are the R&D lab. The fresh environments that not only encourage innovation ideas, products and services that are developed create but also remove the stigma of failure. Failing new markets and economical niches - which in turn is an essential part of the road to success and helps generate jobs and ultimately drives growth. entrepreneurs need to feel confident that they will not be excessively penalised or stigmatised The entrepreneurial ecosystem if they fail along the way. This support must come To promote entrepreneurial growth several from successful entrepreneurs, investors, teachers, environmental factors need to work harmoniously. professors, local councils, the government, local Firstly we must listen to entrepreneurs. Not just at and national businesses. the beginning when they start out, but during all the different stages of their business lifecycle. We should The Barclays Accelerator make it our business to find out what is working for The Barclays Accelerator, powered by Techstars, is a them, what isn’t quite right and most importantly, 13-week intensive programme designed to offer just where they need help. that type of support to start-up businesses.

Secondly, we need a united front. The wider political, The first programme, which ended in September last business and academic communities must work year, saw a range of innovative ideas being pitched to together to explore how we can all meet the needs industry leaders – including a new credit scoring system of the entrepreneurs and start up businesses. and a unique peer-to-peer lending platform that could revolutionise the home-buying process. And thirdly, those same politicians and industry leaders need to make a long-term commitment to improve the But that was just the beginning. As well as continuing entrepreneurial ecosystem. mentorship from top Barclays executives, a number of business engagements between the start-up teams And that is where our mission starts. Barclays, as a and Barclays have started to evolve. Three teams even champion of the entrepreneurial ecosystem, will work joined the Mayor of London on his trade mission to with new partners and discover new ways to improve Asia, as representatives of London’s disruptive and this exciting and fertile business area. innovative technologies.

Entrepreneurs and the global economy Those selected for this year’s programme, which is Start-up businesses are catalysts for employment, both due to start in March 2015, will again have world-class directly and indirectly. The innovations and inventions mentorship from industry experts and the optimum they generate play key roles in the raising of the standard environment to thrive – at the London Escalator in Mile of living. And new ideas and businesses stimulate End. And for the first time they will also have access to the redistribution of wealth to more people and new a catalogue of Barclays APIs and data to help them geographic areas. refine their ideas and business models.

In short, entrepreneurs are very important to the And when you combine new ideas, fresh solutions and global economy. disruptive technologies with the experience of Barclays and Techstars you can have the perfect recipe for And that’s more important now than ever. It’s an prolonged success. unfortunate fact that across the world we have seen relatively slow economic recovery over recent years. barclaysaccelerator.com 37

The digital age The digitisation of everyday processes has significantly influenced the banking sector which is now offering more digital options. From person-to-person payments to remote deposit capture, growing numbers of customers demand service via mobile channels. This means that the financial sector needs to be agile enough to meet this growth and develop their offerings. Our research shows that three quarters (75%) of account holders log on to their online banking at least once a week, while more than half (56%) use a banking app every week. It’s not a choice of a few customers; it’s becoming the way in which people operate their finances.

Overall, the technological developments allowing for the recent surge in mobile and online banking give significant advantages to potential new entrants to the banking market. A trend in attitudes away from branch- based banking means that the barriers to entry are much lower than in the past.

Banking 2020 However, more people embracing the digital era doesn’t necessarily mean that the branch is dead. Our Travers Clarke-Walker research shows that 17% of adults still visit their local high street branch at least once a week and almost Managing Director EMEA, Fiserv half (48%) do this at least once a month. Though the traditional bank branch is going through a period of The UK retail banking sector is continuing to undergo transformation, a strong argument remains for being rapid change and with more new players entering the a multichannel provider. market, and the speed of technological innovation, the landscape is set to look very different by 2020. Child’s play According to the Office of National Statistics, the A new chapter percentage of UK adults aged 16-24 using internet banking Historically there have been three key hurdles for new has almost doubled since 2007 when under a third players looking to enter the UK banking sector: the (30%) were using it, compared to 56% today. However, complexity of the authorisation process, the substantial despite this rapid growth, internet banking usage capital requirements and the high cost of establishing amongst this age group is still lower than most others. an IT solution. However, a reduction in the minimum amount of initial capital required from £5m to £1m This is due to the fact that these services are typically announced by the regulator in 2013, coupled with public only available to those aged 17 or above and as a result, and political desire for more competition, represent by the time they get to the age where they can benefit a shift in the industry. In the past year alone, these from them, they’re not familiar with the technologies so changes have led to the authorisation of five new banks take longer to begin using them. While we are likely to and the submission of 25 new banking applications. see the launch of more products and services targeting this demographic this is a widely underserved market We should see more new players entering the market with significant growth prospects. over the next five years, while current players continue to expand on their existing offerings. Virgin Money’s The future of banking is digital, so whether it is the Essential Current Account, for example, is only available hyped omni-channel experience or a seamless payments at stores in Scotland and Northern Ireland but the experience, technology is dictating how banks interact provider will be rolling it out more widely next year. with customers. The message from customers is clear: Meanwhile, the Post Office announced in June 2014 it provide service anytime, anywhere and any channel. would be extending its pilot current account scheme to But is everyone listening? another 81 branches ahead of a full roll-out in 2015. Agiliti™ from Fiserv is accelerating the UK financial So with the authorisation process and capital services industry transformation by bringing flexibility requirements barriers broadly overcome, IT is perhaps and speed to market for new and existing financial the one remaining hurdle. The introduction of Agiliti™ services providers. removes this remaining barrier meaning that more players can enter the market. fiserv.com agiliti-fiserv.com @Fiserv The FinTech Payment systems – revolution, the next steps becoming reality Tim Leeson and David Willbe, DWF LLP Alex McCracken and Jon Barrett, Silicon Valley Bank This is the time of year when we look at proposed changes to the legal framework, and set that against our dealflow. The UK continued to position itself at the heart of In 300 words, I get to select the most significant. In some FinTech innovation in 2014. years this can be difficult, but not this year.

Venture Capital funding in UK FinTech dramatically Government figures for 2013 (the latest published) increased in 2014, rising to £342m, with the indicate that payment systems enabling funds transfer UK taking half the total investment in FinTech companies between people and institutions processed 21bn in Europe. Some of the most prominent names in transactions, worth more than £75tn. We don’t yet know UK FinTech all took part in large growth rounds to the scale of the increase for 2014. help accelerate development both domestically and internationally, including: Borro, Powa, Funding Circle, The office of the Payment Systems Regulator (PSR), TransferWise, Blockchain, Zopa and Nutmeg. a new economic regulator for the payments industry, is to become fully operational on 1 April 2015. Its latest In 2014, $1 in every $5 invested in the $2.8bn global consultation, entitled “A new regulatory framework FinTech funding market went to UK companies and for payment systems within the UK”, closes on 12 in 2015 we predict this trend to continue as the sector January 2015. continues to evolve. The Government has previously highlighted its principal There are still challenges to overcome; banks remain concerns in relation to the ownership (largely, by the the “enablers” of many FinTech verticals and there is banks), the lack of innovation and the barriers to service- work to be done to remove barriers to entry by evolving provider access to these payment systems. Addressing regulation, compliance and technology. However, banks these concerns is part of a more widespread Government represent the biggest group of potential customers and initiative to create a more competitive banking industry. distribution networks to many FinTech verticals and the relationship remains a complex one as banks work with Often referred to as the plumbing of the UK’s financial all parties to understand their new operational realities. system, the PSR’s remit not only includes electronic payment systems such as Bacs, CHAPS and credit clearing, George Osborne’s 2014 statement of intent to make the but also the underlying infrastructure of hardware, UK the “FinTech capital of the world” has driven action software and secure telecommunications environments across Government, regulators, banks and FinTech to support the clearing and transfer of those payments. companies, fostering an ecosystem of partnership which will strengthen the sector. Individual segments As to access, there are comparatively few service within FinTech are collaborating, from the success providers with direct access rights. There is a proposal in of the crowdfunding industry in getting its activities the consultation to provide open access on an objective, regulated by the FCA, to HM Treasury groups established risk-based and transparent basis. Breaking open an to assist the digital currency community. The breadth oligopoly is familiar territory for die-hard technologists; and depth of the FinTech sector is evolving rapidly those of my vintage will recall very similar issues being and the establishment of Innovate Finance in 2014 is considered by (then) OFTEL over many years regarding a key development. access to fixed and mobile networks, by other operators and service providers. At Silicon Valley Bank, we recognise the importance of FinTech in the UK and are proud to provide banking Other payment systems (e.g. LINK, MasterCard and and lending to innovative FinTech businesses, as well Visa) which are likely to be regulated by the PSR are as adopting some of their solutions to help better serve already subject to access requirements under our clients. European Legislation.

svb.com/uk @svb_uk dwf.co.uk @DWF_Law