Rise FinTech Insights May 2020

#HomeofFinTech Dear friends Contents

These are strange and challenging times, but we hope that 03 15 you, your families and communities are staying safe and well. Open Banking - building Why Open Banking is a At Rise, we remain focused on building and maintaining a better customer-centric catalyst for global M&A global community of the best minds in FinTech to disrupt, propositions challenge and confront the way things are done in our 16 industry. This edition of the Rise FinTech report, which we’ve 04 Q&A: A VC's perspective on renamed Rise FinTech Insights, is part of that effort. We hope The industry’s perspective the current FinTech landscape you enjoy it and we welcome your feedback. Please take our on Open Banking short survey (link below) to help shape the content and format 20 of future editions. We’d love to hear from you. 06 Rise and Eagle Labs Open Banking’s origins ecosystem insights Right now, maintaining the ability to innovate is especially and global reach important to startups and scaleups, which is why we've 23 focused this edition on Open Banking. This is a technology 08 From our Rise sites that presents rich opportunities for FinTechs to uncover the What’s needed to make potential in banking data and develop new financial products Open Banking a reality? 26 like funding platforms, supplier payment services, credit Rise global ecosystem checks or insurance. 10 Now more than ever, people are at the heart of what we do, Open Banking in an 28 so you’ll also find another important highlight in this edition: unregulated world Rise in numbers news from our Rise site leads around the world, and how they're helping our communities in these times. 12 Data sharing in the world of Open Banking Take the survey: Or visit: Scan this QR code: https://tinyurl.com/rise-report

#HomeofFinTech #powerofcommunity 01 / rise. Open Banking - building better customer-centric propositions

As The Economist pointed out1, the collaborating on ways to enhance world's most valuable resource is no customer service and value longer oil, but data. One of the most propositions through new offerings. effective ways that FinTechs can access With regulators providing the the rich seam of consumer banking framework in which to operate, we’re data is with Open Banking, the API- sure to see innovators continue to join driven revolution that started in 2018 forces on Open Banking in ground- and continues to take shape around the breaking ways that will expand the world. For some sectors, possibilities of . It’s a it’s been more evolution than global movement with genuine scope revolution, with progress slower than to disrupt the industry. expected. However, FinTechs have Through its Open Banking APIs, certainly played their part and continue Barclays is playing an active part in to make great strides, developing a that movement and is creating services host of new, customer-centric financial that are making customers’ lives easier products and shaping the way that data and helping them make the most of is used innovatively and, of course, their finances. If you’re interested in securely – whether that’s building new collaborating on APIs with Barclays, funding platforms, supplier payment visit the Barclays API Exchange2. services, credit checks or insurance products. The number of calls to Open Banking Ben Davey APIs is growing, allowing previously CEO, inaccessible customer data to be Barclays Ventures released, with consent, for useful and ben-davey-7186b7161 fascinating purposes. As FinTechs and financial service incumbents alike provide ever-improving solutions to customers’ problems, those customers The world's most valuable are becoming more willing to share their data and aggregate resource is no longer oil, their accounts. 1 Even with the challenges that 2020 but data presents, technology organisations including FinTechs, banks and data aggregators will need to keep

1. https://www.economist.com/leaders/2017/05/06/the-worlds- most-valuable-resource-is-no-longer-oil-but-data 02 / Rise FinTech Insights 2. https://developer.barclays.com/ 03 / rise.barclays The industry’s perspective Open Banking has enabled us, for the first time, to go to where on Open Banking the customer is

Open Banking is transformational. customer experience. By embracing It’s more than just regulation. Across Open Banking, we were the first the world, banks are publishing high-street bank in the UK to offer standardised APIs that offer customers in-app aggregation. We figured that if the choice to share with, and extract customers already loved the app, why information from, third party apps. not empower them by consolidating all Those apps can then offer additional of their financial accounts in it? More value-add financial services to recently, we enabled payments from consumers as a result of the access to aggregated accounts to be facilitated banking data. through our app. While conventional wisdom would This is only the beginning of the Open suggest that regulation such as Banking journey for Barclays as we Open Banking could be a threat to continue to drive innovation throughout an incumbent bank like Barclays, the industry. Ultimately, it’s about the we took a different approach and customer and offering them greater really embraced the initiative. Before simplicity, more innovation, more data Open Banking, we’d always required to more places and, most importantly, customers to come to us – in our the highest level of trust and value. branches, through our phone lines, to Read about the Open Banking options our website, with our mobile banking available to Barclays customers1. app. Open Banking has enabled us, for the first time, to go to where the customer is. It’s been an opportunity to Ashok Vaswani accelerate the digital transformation of Global Head of our bank and ensure we provide greater Consumer Banking and value to our customers. Payments, Barclays It was, and is, our belief that the customer will go to whomever they trust most and provides the best customer experience. We have our 328-year-old legacy and award- winning mobile banking app, a testament to both pillars of trust and

1. https://www.barclays.co.uk/ways-to-bank/ 04 / Rise FinTech Insights open-banking 05 / rise.barclays Open Banking in the United States Benefits of Open Banking At the time of writing, there's no Open The expected benefits are substantial, Banking regulation in the United States. and extend beyond payments. We see the implementation being The consumption of retail banking largely driven by industry or customer products through a marketplace will demand. In particular, the younger open access to more transparent generation of consumers, comprising and customer-centric experiences. millennials and Gen Z, appreciates A great example is how Barclays is Open Banking for its flexibility and using APIs to roll out itemised, digital transparency. receipts for customers and merchants in the UK, following a recent minority Sharing data through Open APIs can investment in the Barclays Accelerator, bear significant risks that challenge powered by Techstars, company supporting processes, governance Flux. Traditional and non-traditional and infrastructure. But experiences providers are competing to close gaps from regulated markets in which in existing offerings and in anticipating Open Banking operates support a future customer needs, for example Open Banking’s origins standardised approach to developing by enabling underserved customers and operating the APIs. For example, to access credit. and global reach California’s privacy law has recently been informed by GDPR legislation1. User adoption in the United States Matthias Hauser Historically, owning customer data customers have transparency and is likely to grow in 2020 with more Strategic Advisory, gave banks a competitive advantage in control over what data a company uses. banks beginning to publish APIs that pricing and risk scoring. The concept Barclays International Since the first Open Banking products allow consumers’ financial data to be of Open Banking was introduced by EU and services pioneered in 2018 in transferred in a secure and safe way hauserma regulators so that new market entrants the UK, new forms of collaboration to third party applications. could access consumer data and between traditional banks, FinTechs, payments more easily. consumer representatives and The European Payment Services regulators have rapidly emerged. Directive (PSD, later revised as PSD2) Despite its early successes in the EU and Global Data Protection Regulation and UK, the adoption of Open Banking (GDPR) have enabled third parties to on a global scale is still limited1. The develop new services that educate level of local regulatory involvement, Customers have transparency customers about their finances and consumer sentiment and adoption, and help them make better financial climate of innovation will determine and control over what data decisions. the speed of adoption in individual countries. Large banks, traditionally a company uses Open APIs are at the heart of Open providers of uniform services globally, Banking. They provide safe, secure will face challenges in adapting to plug-and-play connectivity between different regional requirements. companies and networks, and

1. https://www2.deloitte.com/global/en/pages/financial-services/ 06 / Rise FinTech Insights articles/open-banking-around-the-world.html 07 / rise.barclays What’s needed to make Open Banking a reality? Globally, consumers are using FinTech Open Banking has the potential to Building this infrastructure requires transform financial services by allowing that all participating parties - banks, more than ever. Its use has skyrocketed customers to share their financial data technology companies and data 1 with third parties, who can use it to aggregators - work collaboratively from 16% in 2014 to 64% in 2019 build innovative solutions that meet to protect against fraud and provide those customers’ unmet demands. the connectivity that consumers That includes demands in underserved demand. Financial data is sensitive markets. Open Banking has been on the information, and digital financial horizon for a decade. Only today are services ecosystems are complex. we beginning to realise its potential. Its Customers want to share data from success depends on two key building many different institutions with many blocks: consumer data rights and different applications created by many secure technological infrastructure. different developers. This is where data aggregators play an essential role. Data rights build consumer trust in the By providing network connectivity, ecosystem, and ensure a level playing aggregators work with both banks field for participants. Governments can and developers to ensure data sharing set the landscape for Open Banking is simple and secure, and that data by enshrining data rights that promote security practices are enforced. transparency, control, choice and protection, while also prohibiting resale Globally, consumers are using FinTech of data beyond consumers’ explicit more than ever. Its use has skyrocketed permission. Some jurisdictions, like from 16% in 2014 to 64% in 20191. They Australia, have strong data rights in now stand to benefit tremendously place. Data rights controlled by other from the benefits provided by Open authorities leave much to be desired, Banking, as do providers who can as in the European Union where capture entirely new markets. However, rights only extend to certain data consumers and providers will only types, limiting choice and innovation. benefit if governments enforce data A strong foundation of data rights rights and new forms of collaboration enforces uniformity of data access by flourish across our ecosystem. With any financial institution or third party. these building blocks in place, Open Consumers are then empowered Banking’s future is bright. to choose how to connect financial accounts and financial tools. This type of control and the innovation that underpins it are exactly why Open John Pitts Banking was developed. Policy lead, Plaid

Secure technological infrastructure john-pitts-70549b3 ensures that the ecosystem keeps bad actors out but legitimate, consumer- permissioned data flowing seamlessly. 1. https://fintechauscensus.ey.com/2019/Documents/ 08 / Rise FinTech Insights ey-global-fintech-adoption-index-2019.pdf 09 / rise.barclays Open Banking in an unregulated world

In the new reality of COVID-19, we’ve Fast forward to today, and Open As early as 2018, large banks began More now than ever, I expect to see seen even greater demand for digital Banking in the US is thriving. Increasing entering into agreements with data FinTech companies narrowing the banking products, with adoption borne consumer adoption, positive consumer aggregators to provide secure access regulatory gap through banking-as-a- out of necessity. This has expedited sentiment and the fast pace of to customers’ financial data. More service partnerships, newly licensed demand for Open Banking approaches innovation seem to have outweighed recently, in February 2020, the parent banks (like Varo), and acquisitions to deliver financial services. the lack of a national regulatory agenda company of Fidelity Investments, (like LendingClub). Through these on Open Banking. FMR LLC, spun out its own secure partnerships, future FinTech leaders In October 2018, EY published the EY data access network, Akoya, into an may transform from single product Open Banking Opportunity Index1, The potential of Open Banking is independent company jointly owned by companies to financial services which analysed four factors critical becoming more evident through a Fidelity, The Clearing House, and 11 of platforms. for the promotion of an Open Banking growing number of new embedded its member banks - large and regional. ecosystem: financial services offerings. Banks may also seek to increase their For example: Unlike the UK, there are no federal addressable market by embedding • Regulatory environment: How consumer data privacy laws in the US. their financial products into a growing conducive is the regulatory • Uber Money: Uber’s partnership with However, several states (California, number of technology and consumer environment to Open Banking? Green Dot to offer checking account Hawaii, Maryland, Massachusetts, New platforms that are emerging across (current account) services to their •  What is the York, and North Dakota) have begun the e-commerce, mobility and lifestyle Consumer adoption: drivers potential for consumers to adopt the process of introducing their own ecosystems. Open Banking services based on • Brex Cash: A partnership between laws based on the EU’s GDPR and PSD2 Although uncertainties remain, within existing behaviours? Brex and Radius Bank to provide legislation. In July 2020, California a few short years, Open Banking has reward-earning corporate cash will begin enforcing the California • How do emerged as a disruptive force that’s Consumer sentiment: management accounts Consumer Privacy Act. Banks that reshaping the banking industry and consumers feel about Open Banking embrace Open Banking will be a step creating a new range of innovative and the data sharing involved? • Alphabet Inc’s Google: Plans to ahead of their competitors in complying offer personal checking accounts customer products and services. • How strong with future state-level privacy laws as Innovation environment: through its Google Pay app in 2020 Impediments and barriers are being is the environment at fostering they’ll already have greater insight into in partnership with Citibank and addressed or removed and the future innovation, especially among financial their data and how to manage it. Stanford Federal Credit Union of this new ecosystem remains bright. services firms? What does the future hold for both Behind the scenes, the growth of Open These factors still hold true today, FinTech companies and banks in the Banking is a direct result of private- Sara Elinson although various geographies have Open Banking world? sector agreements on data sharing and Principal, FinTech taken different approaches. The UK, for the evolution of state privacy laws. Strategy & example, adopted a prescriptive model Transactions Leader, where banks are mandated to specified Ernst & Young LLP and standardised APIs. In contrast, Open Banking in the US is being shaped sara-elinson-01643910 without a strong regulatory mandate, @SaraElinson leaving banks and innovative FinTech companies to work out standards among themselves.

This article contains information in summary form and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional 1. https://www.ey.com/en_gl/open-banking- judgment. Member firms of the global EY organization cannot 10 / Rise FinTech Insights opportunity-index accept responsibility for loss to any person relying on this article. 11 / rise.barclays Data sharing in the world of Open Banking

Lock down your data - it’ll set you free. The reasons are pretty clear. But there are ways of releasing data When, as a sector, we can reliably say Ownership and sensitivity are obviously from the vault safely and appropriately. we’re hitting that bar, we’ll be in a great For over a decade now, data scientists factors. I’m unlikely to be able to Modern enterprise architecture is position to really start delivering on from all walks of life have had access to commit fraud or other crimes using more than capable of sharing it with the potential of AI to impact people’s some amazing Artificial Intelligence (AI) weather data and (probably most data scientists while retaining privacy financial lives for the better. Until resources. Personal finance, however, importantly) sharing weather data isn’t and security. It’s mostly organisational then, we’ll be looking enviously over has been overlooked for several creepy. That’s not true of personal culture, practice and architectural our shoulders at the linguists and the reasons. finances and the decades of cultural decisions that prevent this. Institutions meteorologists. Linguists got Google N-Grams in 2011. norms built into our relationships with need to be able to trust AI in order This was 2.2 terabytes of text taken money and privacy. to roll it out at scale, and that means from more than 30 million books and it trusting that the data behind it is being It’s this lack of available data that Ed Maslaveckas revolutionised the way people studied handled securely and ethically. explains why AI hasn’t yet impacted CEO, Bud predictive text. If you’re studying image our personal finances. It’s not that Trust is the key. As an industry, if recognition, you’ve had 14 million we don’t trust computers: we do. we can build that, then the data will edmas images on ImageNet since 2009. Want We’re comforted by the presence come and with it we’ll deliver true @Hyper_Ed to guess how old someone is by looking of the state-of-the-art-autopilot that value to people in their everyday lives. at their hands? There’s even a labelled flies our plane. In contrast, AI’s value Building trust isn’t easy. At Bud, we dataset for that1. (Labelling data adds proposition in relation to our finances make it deliberately hard for ourselves extra, meaningful information to data.) isn’t yet clear because institutions - as we all must. We need to lock In almost every niche, from solar flares have understandably shied away from down the data and look to cutting- to soybeans, there’s an abundance making our sensitive transactional edge technology to return quality of clean, functional, sometimes even data available to the outside world and results within those self-imposed pre-labelled data. But that’s not true the potential fraudsters in it. They’ve constraints. There needs to be an when it comes to your finances. It effectively locked the data away in a industry standard for anonymisation always astonishes me that, to model vault. (the UK Anonymisation Network, the likelihood of an El Nino weather UKAN, is a good start) that’s trusted system coalescing, we can access data by FinTechs and institutions alike. The from more than 178,000 buoys, but if practice of encrypting individual users’ we want to use AI to help someone get transactions with individual keys also on in life by spotting a change in their needs to be commonplace. electricity bill, we have to build our own dataset from scratch. There are precisely zero free or low cost options available.

12 / Rise FinTech Insights 1. https://sites.google.com/view/11khands 13 / rise.barclays Why Open Banking is a catalyst for global M&A

Open Banking has disrupted the The COVID-19 pandemic is leading financial services landscape for key to an increased need for digital players including traditional banks, banking services, which could FinTechs and challenger banks, accelerate disruption from FinTechs creating opportunities and threats and incumbents alike. In April this for all players and leaving them with year, SoFi announced the acquisition two choices: either to invest internally of Galileo, the API and payments in R&D and expansion or to find platform provider, for $1.2 billion. The external opportunities for growth acquisition will allow SoFi to distribute through strategic partnerships and products through APIs to Galileo’s consolidation. partners, including Robinhood, , Chime and Varo. The announcement 2018 saw the first wave of mergers amid market uncertainty could indicate and acquisitions (M&A) in the Open continued appetite from strategic Banking space, driven in part by buyers and investors to engage. the UK’s Competition and Markets Open Banking players might be well Authority’s (CMA’s) mandate that positioned to succeed in the new, the nine largest account providers digitally disruptive environment we now develop APIs. In September that year, find ourselves in. PayPal announced its acquisition of Swedish mobile payments company, iZettle, for $2.2 billion, enhancing PayPal’s products and services for small Susana Lacouture businesses. Other notable acquisitions Analyst, Barclays into 2019 included Fiserv’s $22 billion International acquisition of First Data and FIS’s $33.5 billion acquisition of Worldpay. susanalacouture 2018 saw the first Most recently, in January 2020, Visa announced its acquisition of wave of M&As in the US-based Plaid for $5.3 billion. The acquisition is strategic for both parties Open Banking space and places Visa firmly in the FinTech realm, allowing it to build relationships with FinTech companies while also providing new business opportunities. And Plaid gets a platform to scale its products both in the US and globally. The announcement was met with a positive reaction from the market and could encourage other Open Banking players to look to M&A as a strategic alternative.

14 / Rise FinTech Insights 15 / rise.barclays Q&A: A VC's perspective on the current FinTech landscape

When we started planning this edition of Rise FinTech Insights, the World Health Organization had just announced COVID-19 as the official name of the disease caused by Coronavirus. The FinTech community has not been immune to the effects of this global pandemic. For that reason, our editorial team thought that this report would be incomplete if it did not address the current impact of COVID-19 on FinTech startups and the teams behind them. In this article, Alexandra Gheorghe, editorial lead and Rise FinTech Platform Manager for Barclays Ventures US, spoke with Nari Ansari, General Partner at growth equity firm TCV. Nari spearheads TCV’s Financial Technology and Payments practice in North America. Alexandra Gheorghe: Thank you for participating in this interview, Nari. To begin, I want to discuss the effects of COVID-19 and the instability in the public markets. Tell us about one or two main impacts on the private markets and VC funding due to the recent volatility? Nari Ansari: Investors will likely be slower in deploying capital. We are coming off a 10- to 12-year bull market, so even though it’s hard to know exactly what the percent drop will be, we do expect to see a reduced velocity on the investor side. Those are a couple of categories that should see benefits. However, the On the entrepreneur side, there is a lot of uncertainty about the environment, short- versus long-term effects on the demand curve in the current environment whether it’s the funding environment or the health and wellbeing of their are a little too early to predict. employees, and of their customers and revenue from them. It’s a dynamic AG: TCV focuses on growth stage investments. Do you have insights on how environment right now on a number of different fronts, but I do think that deals for early-stage companies are weathering the volatility? good companies will continue to get done, though these deals may have different set-ups with regards to their terms and value. NA: Every late stage company was an early stage company first – that’s something we like to say at TCV. We have a fairly good view of the longitudinal evolution of AG: The FinTech industry is a combination of different verticals, some of which many of these companies because we spend a lot of time with them in their earlier have been well positioned to deal with the market volatility and effects of incarnations before they get to the scale and maturity that makes them viable COVID-19. Have you seen certain verticals within FinTech weathering the storm candidates for our funding model. better than others, and why? For early stage businesses, liquidity management and thinking through runway in NA: A question we ask ourselves a lot as investors is whether or not we are terms of cash and cash burn are incredibly important. The haves and have-nots are seeing a short-term pull-forward of demand or a fundamental altering of the going to be decided by those with a clearly established product market fit, demand curve. even at an early stage, versus those pivoting or experimenting. The trading businesses have seen a short-term benefit from volumes and volatility,

and I think you can see that across a few different companies. So they are seeing some positive effects for the moment. Digital payments will continue to be an area that should see strength on the back of e-commerce in a shelter-in-place environment. Relatedly, digitising business-to-business (B2B) payments should see a healthy uptick in adoption in a remote work setting where invoicing, writing cheques and anything that is manual or paper-based is a challenge.

16 / Rise FinTech Insights 17 / rise.barclays One of the areas we’re also monitoring and think is very interesting is the narrative of fraud and risk. If there are technologies to help banks, payment firms, merchants and other participants deal with these challenges, including credit card fraud and money laundering (among other things), that could be something that continues to show strength through this period and beyond. AG: The need for a stronger cybersecurity and risk environment is an increasing AG: VC firms are shifting support towards their existing portfolio companies and trend across the finance industry. Final question. What advice would you give placing a premium on existing relationships. What are the biggest challenges you to a founder as they navigate both positive and negative exposure to the current have seen these companies face during this time and how are you helping them environment? address those challenges? NA: First, I think exhibiting the right kind of leadership right now for their employee NA: I think it depends on each firm’s unique situation but we are certainly open for base – empathy, transparency, decisiveness and over communication – those business and looking for new investments – though even in the pre-COVID-19 era, are critical right now. Second (and it probably sounds like I am beating a dead for new deal opportunities we were often focused on existing relationships with horse right now) is cash. Cash is oxygen. The runway allows for flexibility and the companies operating in segments we had followed for a long time. On working ability to navigate the hour-by-hour, day-by-day changing landscape is incredibly with the portfolio during this dynamic period, there are about four or five main important. Third, a view that is much more nuanced is the need for founders to areas that we have been emphasising with our portfolio companies. take a granular assessment of their business right now, and to understand how their clients will be affected across different verticals, channels, product mixes and First, capital. Capital allocation and liquidity management you’re focused on right delivery modalities, because they won’t all be affected in the same way. now whether you are an early stage, later stage, or even a multi-billion-dollar company. Companies should also focus on workforce planning, particularly where Finally, companies need to think about how they plan to play offence on the other you are seeing different types of dynamics in your end market with regards to side of this. Because there will be ‘the other side’. One of the things we talk about demand. Industrialising go-to-market initiatives, including sales, marketing and with our companies is, don’t just think about your cash as a runway through the customer success, is important in keeping existing customer relationships healthy downturn, think about your cash as a runway through the upswing on the other and being able to add new ones where possible. This is especially important for side. This last point is a little bit more optimistic compared to the other three SaaS companies, subscription software companies, where their lifeblood pieces of advice I mentioned, but again, great businesses get battle-hardened in is renewals. times like these and come out stronger at the other end. Lastly, scenario planning. We spend significant time with our companies walking AG: In an environment like this, it’s essential to retain that optimistic view of the through the scenario plans for 3-, 6-, 12- or 18-month disruptions and getting them other side of this crisis. Everyone, including FinTech, will get through this crisis prepared for those potential elements. Thankfully we have a dedicated portfolio with lessons learned and new opportunities on the other side. Thank you so operations team here at TCV that spans functional centres of excellence across much, Nari, for sharing your thoughts and advice with the Rise community. talent, product, operations, and sales and marketing. They have been instrumental in helping our portfolio navigate some of these challenges. AG: Where do you see the biggest opportunity for FinTechs post-COVID? Nari Ansari General Partner, TCV NA: I think there will be an acceleration in cloud adoption for banks and insurance companies to deal with the cloud-based digital automation of workflows for technology-crossover-ventures different activities. Financial services has been one of the industries more reticent @TCVTech to move to cloud due to security, privacy and existing infrastructure. However, in a remote and distributed workforce environment, you see that the ability to access cloud infrastructure is more critical than ever for business continuity planning.

18 / Rise FinTech Insights 19 / rise.barclays Rise and Eagle Labs London Eagle Labs (UK) • $1.14bn in VC investments¹ Eagle Labs in the UK support non- ecosystem insights FinTech sectors including HealthTech, • 56 VC deals¹ GamesTech and LawTech. • Top VC deals¹: – $500m • 85,700+ Eagle Labs visitors³ Thought Machine – $83m • 2,460+ Eagle Labs events³ Currency Cloud – $80m • 551 Resident Businesses⁴ New York • 7,100+ Rise visitors • 2,023 Resident Co-workers⁴ • • 52 Rise events $458m in VC investments¹ • £793m funding raised by all Eagle • 40 VC deals¹ Lab Residents and Alumni⁴,⁵ • Top VC deals¹: iCapital Network – $146m Justworks – $50m Kasisto – $22m • 3,600+ Rise visitors • 63 Rise events

Tel Aviv Mumbai • $2.43bn in VC investments² • $38m in VC investments¹ • 84 VC deals² • 10 VC deals¹ • Top VC deals²: • Top VC deals¹: Via – $400m SMECorner – $30m AppsFlyer – $210m CoinDCX – $3m SentinelOne – $200m Fintso – $2.6m • 1,800+ Rise visitors • 3,000+ Rise visitors • 16 Rise events • 30 Rise events

Sources: 1: Innovate Finance via Pitchbook. Q1 data, not reviewed or approved by PitchBook analysts 2: VC-backed deals in Israel (not Tel Aviv alone). Q1 data, provided by IVC Research Center 20 / Rise FinTech Insights 3: 2019 data, all UK sites / 4: As of March 2020 / 5: Data from Crunchbase 21 / rise.barclays From our Rise sites

Rise London By adapting quickly, FinTech companies (not just in London) will be best placed Where to begin. The world’s facing a to support the global population in this health crisis unlike anything we have time of change, potentially giving them ever seen before and, at the time of a distinct ‘edge’ on the competition. writing, the UK has been in lockdown That always was the case, but these for several weeks. Unprecedented days that adaptation may be the key levels of uncertainty and adjusting to success. to new ways of working – possibly involving kids, pets and a lot of virtual In the next three to six months, calls – are the new normal. Navigating we’ll track closely how the UK FinTech all of this quickly and responding to this ecosystem responds and takes huge change is imperative to the future advantage of the UK Government’s of our industry. various funding initiatives. UK FinTech can benefit from cash injections What does the future of financial through a number of grant, loan services and, most importantly, FinTech and equity investment schemes. look like from London? There is no It’s also interesting to see how many doubt that the effects of COVID-19 FinTechs are playing a key role in will be hard felt by entrepreneurs and distributing these funds and helping businesses. Unfortunately, many will the Government do so quickly, as the struggle over the coming months, and current situation requires. we may see a number of them fold under these new, harsh economic pressures. However, with this adversity come some opportunities. The FinTech Clare Whitehead sector defines itself by its ability to and Magdalena Krön adopt creative approaches to problem Rise London solving and to meet new customer @clarewhite200 demands at speed. We’ve seen this in

action already within and around the magdalenakron London ecosystem. And, because most FinTech companies are built in a digital @MyKron environment, switching to remote working doesn’t seem to have surfaced too many challenges.

22 / Rise FinTech Insights 23 / rise.barclays Rise Mumbai Your Customer (KYC) tool, a digital Rise New York There will be challenges as economic signature tool and a two-way video instability forces companies to In the wake of the COVID-19 outbreak, To look at this past quarter at Rise New conferencing tool for a completely make harsh decisions about their Indian businesses have been forced to York is to find the common thread of digital onboarding experience. workforce and the resiliency of their switch to a remote working model and unity within our community. businesses. But, with challenges, come rely on digital touchpoints to connect FinTechs are also creatively leveraging In the first half of the quarter, our opportunities. FinTechs are digitally with their customers. FinTech startups, communication tools like Skype to community united to celebrate Black native and highly agile when faced with viewing the crisis as an opportunity, are keep their employees engaged. They’re History Month and International problems. As a result, we have seen swiftly adapting their operating models. focusing on employee engagement Women’s Day. Rise New York partnered some FinTechs providing discounted With their backend and development through virtual sessions like yoga, with Barclays’ Diversity and Inclusion services to assist small businesses and stacks typically built on a cloud HIIT, coffee breaks and even jamming network to host an evening with others using new technologies, such environment, they’re well equipped to maintain the mental and physical Lauren Simmons, a former equities as AI and blockchain, to reduce the to operate in this new environment. wellbeing of colleagues. trader who, at 23 years old, became impact of COVID-19 for customers and They’re considering new ways of While the impact and magnitude of both the youngest and only full-time for financial institutions. operating in every way, to engage with the COVID-19 pandemic on FinTechs’ female trader on the New York Stock their employees, customers, investors We can’t be certain when life will financial viability is still uncertain, Exchange. Simmons was also the and other stakeholders. return to normal. But, New Yorkers are fundraising for the 2020 fiscal year second African-American female trader resilient, as is the FinTech community. FinTechs are launching innovative could be challenging as many VCs, in the NYSE’s 226 years. Both will embrace this new normal, and solutions to support the customers fearing a global recession, are delaying Today, we are united for another the next normal, to continue innovating affected by the crisis. For example, investment decisions. In order to reason. Our community, and every and providing the best products to some people fear that the virus can cope with shrinking cash flows, community around the world, is customers, now more than ever. spread through physical currency, so startups looking to raise funds are facing a period of uncertainty and FinTechs are pushing digital payment relying heavily on existing investors, social distancing. But, through this options like mobile payment apps. while bootstrapped companies are uncertainty, Rise has united to support Ilana Fass and To increase customer retention at considering angel investors. Startups its member companies by temporarily Alexandra Gheorghe such difficult times, some FinTechs are looking for a flat round of funding freezing memberships and by creating are offering discounted pricing and that gives them 12 months of visibility Rise New York a digital platform and virtual offerings free services. CreditEnable is offering while they continue to conserve cash for members, supporting the FinTech ilana-fass-66813789 free credit health checks for its SME and optimise burn rate. community as it continues to build the customers. According to Akbar At present, the Indian digital ecosystem future of financial services. gheorghealexandra Khan, the CEO in India: “Disruption continues to grow, and so too does @theAlexGheorghe is an opportunity to accelerate our trust in it. If that situation continues, business, both from an operational and the reliability, efficiency and adoption a business standpoint”. Similarly, to of ‘digital’ also paves the way for a full support their institutional clients such digital economy in the country. as banks and Non-Banking Financial Companies (NBFCs), FinTechs are Lincy Therattil enhancing their solutions to cater to and Arti Agrawal the new online world, with Signzy, Rise Mumbai for instance, recently launching three new products - a video-based Know lincy-therattil-9010157 @LTherattil

24 / Rise FinTech Insights arti-agrawal-87096536 25 / rise.barclays Rise global ecosystem Enterprise Innovation Solutions Services

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This infographic shows companies resident at our Rise sites. The information is accurate at 26 / Rise FinTech Insights the time of publication. 27 / rise.barclays Rise in numbers 1,000+ Individual Rise members 175+ Rise FinTech resident companies 80,000+ Yearly visitors (2019) 37,000+ Social media followers 29 / rise.barclays NOTES Rise is a trade mark of Barclays plc, used under licence. Registered in England. Registered No: 1026167. Registered Office: 1 Churchill Place, London E14 5HP. E14 London Place, 1Churchill Office: 2020 Registered © Barclays 1026167. No: Registered England. in Registered licence. under used plc, Barclays of mark atrade is Rise your on based advise further seek You should before actingcircumstances on any report. of this the information included within in this report. contained information on impact based the made for liability decisions no any from, accepts arising, Barclays however given. is loss, any or of, information the of completeness or accuracy the regarding undertakings or implied, or warranties no express takes whether Barclays kind, any of Barclays. of intent or policy of statements as taken be they of views should the nor reflect (‘Barclays) Group PLC Bank necessarily not do and Barclays the alone, authors the of views the are article this in the at featured accurate is opinions guide and this in views the However, contained publication. information of the time that ensure to try to made been has attempt Every PLC. Bank Barclays to proprietary is report This visit follow or on: us To join our community, or keep in touch with the latest Rise news, FinTech for place with Barclays. together scale and create to connect, companies in the main FinTech based workspaces and the world, exclusive Rise an is of hubs FinTech of network programmes the world’s of one talent, accelerator leading adiverse With services. to the future financial of create together working the world’s of top community innovators aglobal is by Barclays, Rise, created About Rise, created by Barclays

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