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FinTech & Future Financial Services: Retaining London’s FinTech crown
Facing twin threats from Brexit and the economic impact of the pandemic, the recent Kalifa Review outlined a roadmap to protect the British FinTech industry. Aside from accelerating the growth of FinTech companies through increased investment, better access to talent and favourable regulation — what more needs to be done to retain London’s FinTech crown? This panel explores the answers.
Russ Shaw CBE - Founder - Tech London Advocates & Global Tech Advocates
Anne Boden MBE - Chief Executive Officer - Starling Bank
Emily Nicolle - Fintech Correspondent - Financial News (Moderator)
Fintech Correspondent at Financial News, a Dow Jones publication focused on London and Europe’s financial services sector. If you'd like to get in touch, you can reach me on Twitter (@emilyjnicolle), or via email: email@example.com — I don't check LinkedIn DMs often.View the profile
The hi everyone and welcome to the first session on context and the future, but not just as the stage at 32 of an apology is, if you can hear any binding on my end as construction lives, as always, but I'm delighted to be with you today. But a special session. The next 45 minutes, we're going to be asking the question account. London retain its bench at Crown, the latest figures from innovate, final can't slow down with insert phones in the UK over the last year and a half or so and preach
which is pretty good. Go and given the circumstances and the UK is still with us. However, we've had denied the twin challenges of brexit on the pandemic to contend with so know all is well in the sector and one investment raises a great success, the full story of what's going on, in London, the recent cleaner review outlined a number of recommendations that suggested London and make a mistake most hold on to its impact Supremacy. So, it's really understand what friends come next week in tech in London and how the sex that
can realize, first future opportunities and challenges and joined by two leading figures from London's Tech and fence 1/2 acre system. Success stories, the last 12 months, 16 sonnenbank reach profitability support in funding to be a unicorn. I was at Colfax already yesterday so long as the text Jarrett tosk. She said that she will come on. How are you doing? Very well looking forward to today. And then also joining us a special who is one of the country's most Champions. He founded
the private sector to address the challenges facing tech companies. R Us has been named London Business Hero by the mayor of London is a founding partner of London Tech week, which is another one of his attack. And then we didn't I'm about to go to the founder of global to see you. And we've got a an audience here with us. So great to see some faces here. Like I said, just to get started. On the one hand. We have concerns about brexit and the pandemic Legacy cry right now
than we thought they would be, if we, we just raise the money, but all the sudden we had a pandemic. We didn't know how we would get a code. We didn't know how consumers word reactant In This Very Room. Difficult time. And yes, we had a huge heartache. We've had many people would be inheriting fundamental family Ways. By this this this pandemic businesses have succeeded people. During the last 12 months. We have learned more than two billion, just a little business to
businesses and consumers Embrace digital. And we were talking about you for many, many years and suddenly it happened and I don't think we getting back. I don't think we're going back to an old world. I think they giving to embrace results of new technology and digital experiences. I'm very excited that we're right in the middle of it. Yeah, I know. That's a great point about not going back in the future at least in London has definitely been changed a lot. Like what happened with brexit and I just might be more than just the next 12 months. You have any insight
that send text to Echo and points is a very positive one. I do think if you look back over the past 12 to 18 months, the one part of the ecosystem that I think did struggle with more the earlier stage. This is his, many of them were struggling to it to raise funding, you know, it was great to see the chancellor step in with the future fund, Innovative Finance, getting a lot more Grant application funding to make sure that we were supporting those earlier stage businesses, the latest age businesses to scale up the
tech unicorns like Starling I think have gone from strength to strength and the future is very bright for them. The other thing I would just say is, you know, that the London and UK to fintech, ecosystem is very strong and and I try and challenge people to look on the global Arena to look, you got the US, you got China, the u.s. Win Tech. Ecosystem is growing at a very fast paced. They probably were a bit slow Off the Mark, but the funding going into that is phenomenal. China is in an in a very differently,. It was interesting to see the ant Financial ipob until just a few days before
indicating that the Chinese government is looking to put more regulation around the larger fintech in China, but for me the UK's kind of emerging as that third very important ecosystem and I think that is our opportunity and the Gap that I see if there is a gap, is how do we ensure that? We have the funding, the scaling funding available for UK fintex to grow and expand on the on the global stage? Yeah and rushes to build on that point as well. Definitely over the last year, but the ground what was already that the investment seen in? London has really been maturing. Those
more funding is going to Lady stage is like stalling out of relevant to the younger ones. You mentioned at least age cuz it's the kind of thing that's on the box. How do you see that changing? If we reinvent the emerging? I'm hopeful that those later-stage Finn texting and unicorns will continue to secure the funding that they that they need. I'm there's a very big push is probably many of you know that I have more of these fintech IPO typically on the London Stock Exchange. There's the Lord huel review that came
out a few months ago, talking about how the London Stock Exchange. Can I get to liberalize if you will, to make it a bit easier for these fin text 222 float here, rather than going to to the NASDAQ in the u.s. Not think that's a very good opportunity ahead of us. So that's something that we want to watch. I'm still keeping an eye on those earlier, stage seed, funding businesses. That's not going to hit us in the immediate term, but we could see some gaps over the next three to five years. If we don't keep an eye on that earlier stage in the ecosystem. Yeah, and I guess I'm, you have a
unique perspective to learn that as well because you're one of those Ice Age businesses. And while it's not currently on the cause he said that my p.m. Is definitely in your future and then also as well. And you said that something might intend to make more Acquisitions. And so, how do you see the landscape? Installing help with both the base around on the earlier, run the business? How do you spell to say this darling? Is it a bit different? Because we're back and because we are banked, we have the funding challenges from
the very beginning at the bank, cuz I fully regulated institution. You can't take advantage of the tax things, upfront and Reese's find, it very difficult to embrace the whole banking Concepts on, IPO investors that across and the funds are actually well. Hell, did she ask you an idea? What we have is incredibly difficult for all businesses and funding through the difficult phase in the middle. I think I think it's worth saying that all of us wanted to talk up the whole concept of
London, attracting Finance, London, attracting investors, but all entrepreneurs, find it incredibly difficult raising funding and and that's where it whatever you want in the world. And it is, we do need to work really, really hard to make sure that the right businesses and the businesses are going to give Rachel abs and bring the right social. Ecosystems get that from then it is tough and just because I've spent the last couple years, raising the funding and weak. Now I'm off to a nice position. We all need to stop. Keep banging. The drum about the
need for more funding. The need. Most support and the fact that there is a justified in this middle. Between the seed around and they are and I'm guessing the profitability. It's still quite difficult people out there. Yeah, I think I'm not quite with it to today to discuss the complete the review today. I'm stroking it. That was recently published and as recommendations to policymakers and government and on what we can do to help prevent except the Crow and the brexit on the pandemic, what for you
with the most important, takeaways on that. I think the most important takeaway was that an old falletta people, spent an awful lot of time, really doing some thinking about what needed to be done. And there were numerous web James operating for quite a long. Of time and getting this report published. I think they Despite having the report. We now have to be implemented. And there's a danger that we say, we don't take that box and wait and and and, and we move out and there's a lot to be done and taking that report to something that
we can execute and actually deliver. The results is probably going to take yours. I'm what I'm really worried about is that in the period of implementing that report? We don't we don't get distracted on this wonderful opportunity. We have innocent Act of bringing bringing jokes. Not just in London or across the UK. At the thing about our industry is that it is bringing lunch today in Assumption, we have 250 people, look inside, Then we have in our differences. Whales in Texas, real
estate generating those great. But as well as all the cocktail parties with real jobs to the recommendations that made that you think was super important element of it for me, which is very exciting. And the initiatives around creating a center for finance Innovation and Technology, creating International fintech ambassador's. Expanding the fintech bridges. We got fintech Bridges with Singapore, with Australia, with Korea. I think we need fintech, purchase it with, with the us as well. So I think there are a lot of good components to it. And I think the issue will be around. How can we Implement
them and implemented quickly. We really need to drive more inward investment into the UK from fintech businesses and investors around the world and touching a bit more than what we were saying earlier. We really need to drive that International expansion for those UK fintech businesses who are here. And I think the Khalifa review addresses that the other piece of the khalifah review which which I wasn't directly involved with. But was led by Sherry coutu who founded the scalloped Institute, runs Founders for schools is all-around skills, one of the challenges that we face not
just infintech, but in the tech sector. More broadly is a shortage of talent to lack of diversity in talent, and we really need to double-down on the Skills component of that. And we need to drive a greater diversity infintech message, which is something. I think the Khalifa review didn't pick up on but we need to look at all of those things. There's a great Coalition of all kinds of leaders people, like and many others who really want to see these recommendations implemented. And we need to move quickly on that speed is of the essence when they're about to bust a inclusion. That was
something that a few people in and take pics of one is something being missing from the Khalifa review, women, for example, and people of color, really quite hard to try and embrace More, Diapers hiring and make sure I'm. Do you think that Kentucky has done enough to kind of change in recent years? And what could they do in the next 10 years that can make a difference? Things have changed a lot in the majority of people involved in the fintech industry and they said it to you
would be, it's okay. Let's face it. Many more. Divest entrepreneurs in. Also two ways that was the last to the typical Maroon 5 and spread the message that the business. You two can do that scientists have been in the financial services industry, a long time and I was in the technical time today in tech company on. It is possible. But digest digest to the population of entrepreneurs, find it, it's easy as a species to invest in people that look like them and sounds like them and have done a similar, sort of Education to them. A breaking up mode. You have to be a brave e, c, a n v
c, sometimes take the easy option. And in order to actually, make sure that way we never break that, but we need to talk about it. How many successes we need successful businesses? That can say, yeah, and if this group of people, pray to the great company, a great template, and are they not like other companies and it has been successful. I'm picking up when air is that were ignored as well as climate change is a big one than people. Think they can leave her. If you missed out on a plane and you'll both involved in campaigns the circus on. Tyco
challenging for NetZero at Ross. Why do you think that's been Tech? Can have a big role in that slides against climate change. We today with heart, to heal a black, women in Tech and UK, blocktech. We did a black Tech leaders survey and we released the results 3 weeks ago. And, and that Community has echoed. Many of the points that Anne was just making very much saying look, you know, people are, are are listening now, but they're not taking enough action. They want
to see greater diversity of management teams and executive board, part of the survey. We also asked Alice, which of those tech companies that you see out there that are doing a good job. And as you would expect the goo, The Facebook's the Microsoft did pretty well, but interesting Lee for me munzo came out as number six or number 7. So I think we should take a look at what is monzo doing? What are some of these other companies doing that is escorting? Highly with, you know, for example, black Tech leaders in the community saying, these are companies that are doing great, things
onto your point about fintech and and and climate. I think there's a huge opportunity here. You just look at the G7 Summit discussions around climate and climate change. I don't think they spoke enough about climate finance and I think that's an opportunity. A significant opportunity for the fintech sector. You're seeing, you know, Finn text like stripe in the US launch, something called stripe climate where they're going to take proceeds from some of their transactions and and diverted to, you know, Carbon reductions games and things
like that. You've got at most Financial that Starting up savings accounts for customers and that enables them to load money to carpet companies that are reducing their carbon Footprints. So, you've got emerging examples of of the role that fintech can play in terms of climate change, both in terms of the companies that are emerging to try, I'll tackle it directly, but I think fintech can have a very, very significant voice in terms of funding. Many of the climate change initiatives that are out there today. And what do you think of that as well? Given that you were on stage at cookouts?
Talking about this yesterday? But I think that when you took my friend check and consider what you need to do to solve this big problem to realize bathroom check itself, doesn't deal with the problem day today. What companies have to transform themselves into using different energy sources in a state, trying to educate and retool the organization for a different world. That's sustainable. And is far more considerate to the environment. Syntec Industries self. It is almost there and I wait, wait, we are a digital industry. We are
going to try and figure out how we have the right to influence other Industries, not experiencing ourselves. What are the tools we can use is too and it's a pain and she died on Linton capability. And I think that the, you know, the government on the on the Regulators around the world are showing the way. I'm under could be an interesting path where, you know, organizations with Vonage, such as ourselves could with government Health direct. Funding in the right way to the right companies that make the most change. Yes. We have to set a good example ourselves,
but I think that we as an industry have to be a facilitator. And at the moment we probably not feeling the pain that other larger companies in different Industries out of feeling, because they have to realize they have to go to a human just about to change in order to get where they need to be. Not feeling that pain is the opportunity now for the for the fintech sector and I think him and part of what we trying to do with tech London, have a kids and Global Tech Advocates is to Showcase. And to promote
those organizations that are really embracing this. We've got a new investor Showcase Event coming up on the 30th of June. And the whole focus is on Tech for NetZero, hearing from the investors that are out there in the community. What are they investing in, what excites him in the fintech space? That is helping them to look at tech for NetZero. We've got a start-up commitment or asking startups to think about what is it that you can do in. And some of them, say look what we're trying to do what we can. But when we conducted a couple of round tables, two months ago. Some of them said, the one
thing we not doing a good enough job on his tracking, the measurements putting the KP eyes and placed that really shows how we're moving the needle. So, I take that as a key part of what I think we can look at infintech, which is not only walking. How can they demonstrate how each individual company is moving the needle in the space? Whether its lending is as and describe, or whether it's actually their own office, has their own staff, see, the people at the same. Look, we all have to collectively sign up for this. This is this is a massive, massive thing for all of us as we know.
So, you know, we can have governments do sweeping policy statements and things like that, which is great. But you know, I've learned and running this community over eight years, you've got to work it from the Grassroots perspective individual by the individual Company by company. And if we collectively to that we will start to move the needle. Sorry about that. I know it. Otherwise that can really help with groceries and fax in 1 hour. That was a One pot of the big lumps and Bubbles that there is it's obviously a big hug because of its closest to the regular basis and then they
will be needs to go help on, you've been apart of thought of the sea with stalling. So how do you think? Since I can start actually benefit everybody across the country people that we take leveling up really, really seriously. I'm as I said before, we have the majority of Starlings. I work outside London today. If so, yes. And I didn't exist. We may have a lot of meetings that she think it's very very cool of what's really important is that we gave everybody the tools to conduct conduct a financial Lori has really really valuable and that's what we take very seriously
and that we give people a great jobs that and teach them great skills skills and data science skills, coding skills, empathy skills. And with the lockdown in, instead of lifting on people, getting back into offices and starting to embrace this new. Well, I think the new was going to be back yet. We can hire People in a much wider range of Rose around the whole country because people are not going to go to the office every day. They going to go, where can I buy Bridgeway to be more
places? We can hire people of different sorts of contracts and we can take the matcha. Caffeine check up and down the country to lots of people and that's a great option. And then this is our final kind of questions you guys before we give it to audience questions. I bet everybody's and thank you questions. I'd like to ask. I know I am rust coming to you on this. Last one is most of your focus in London's already been recognized as the global capital for things hack. What do you think he needs to do next to keep that position, leveling up the rest of the country's great. But yes,
I agree and I often talked about, it's not the tyranny of the or it's the greatness of the end. And you know, we have to keep driving the leveling up agenda across. Country and I would actually say that the growth of fintech across the company or country was already happening. Well before this term leveling came up a little became popular. I mean if you look at Manchester today, there's 8,000 fintech workers in Manchester. You know, you got Novo, you got Mojo. You've got a Bank Of Pi, you know, you've got the University of Leeds with their, their, their Center for financial technology and
Innovation, you know, you've got free things happening in Edinburgh and Glasgow. We've got Global Tech, Advocates groups in Belfast and Edinboro and Manchester. So it is happening, but we can't ignore that. London is a fantastic Global asset. For this nation, over the years. I've always said, you know, and maybe I'm an American who lived here for thirty years, but I think London is the world's only truly Global city. That is reflective of what's happened in our technology sector with with fintech being, you know, that. Shining
But we can't be complacent. We can't be arrogant. We have to double down and work that much harder, you know, the pandemic has hit hard, breaks. It is is creating some challenges. You know, we still do not have a UK EU data, adequacy agreement in place. It was punted till the end of June. If, if you remember correctly, that, you know, if we don't get that agreement in place that's going to hit. Cloud business, is fintech businesses digital payment, pretty hard. So we have to keep the focus on that. We have to coming back to the start of the
conversation. Keep the investment pipeline, growing and building. And I really need an echo and comments about how hard it is to raise money. In a previous life. I was the latest a CEO of a, of a start-up. And I did a series D round and it nearly killed me. And, you know, I look at the great work that and is doing and how she keeps driving it. But these things take I told so we have to work with these companies to ensure that the funds are available. So let's keep building on what we're doing that. We haven't talked about is the regulatory
environment. Two years ago. I spoke in Beijing at the NGC for which is a national Forum there. They invited me to talk about UK fintech and I was out of my seven points, all lined up and how wonderful it is and it was all in Mandarin. I was one of just two English speakers and I was all ready to talk about the financial conduct Authority, the sandbox, The Innovation that they're driving, and I didn't have to do that because the two Chinese speakers before me were referencing that as a world-leading example of the regulatory Frameworks that the UK has to the FCA.
So one of the thing that we should put into this mix and conversation is lucky focusing on the regulatory framework. Let's support the London Stock Exchange to open up and And get more IPOs that are coming out of the UK. I think that's what we need to drive more of this. Yeah, I'm sorry. I think there's an MZ in the room with you Russ. I hope you can help us Point towards an audience question. If we've got any lined up already. And here she comes. Hi Joy.
Thanks for a wonderful presentation. Where is McCollough? I wanted to ask when we talked about diversity and climate change with about companies that are like in a thousand people or more. That's where you can change. But I feel like starting out and your company one. How do you position yourself to not have to do the change when your company doesn't think it's a great question? My sense of that is, if you build that into your, your company values right from day one, it will make it far easier for you down the line. And the example, I would use his slack. I'm
at the CTO of slack, a few years ago. And it's like, has a good reputation for 4/4 are really driving it. A DNA agenda. When I spoke to see Terry said, look, you know, when they set up a company, there are four or five of them. They said they put dni at the heart of who they were about and what they were doing. And he said to me said, you know, I couldn't imagine by the time we got to 270. Having to shift and refocus, you know, having built the company in a very different way. And I think the same approach that you're taking with climate change. If you build it in, right from the start,
it might add some additional challenges to, its you're very busy day. But at the same time, you know, if it's inherent in your organization right from the get-go, I think that will make it far easier for you down the line. So I would applaud what you're doing. If you can really do that. A lot of the earliest age start up some talking to do do that or trying to do that and I think that will only help them as they grow and expand. So I don't know and if you want to jump in on that as well. United States of the Starship, people
get together with friends and colleagues. start a business and it tends to be people look and sound alike at that stage. and people like Paul Graham in some of his essays actually been saying that that is going to be The housing diversity. In the early days of company. Is there a risk? We had VC saying that for a long time, we going to break that. We could break that thinking, that is too much team risk when you have people of different but look and sound different in the early stages. Because
BCC difference on an early team in the first 10 people. As being a rest, would much rather deal with teens that look and sound the same species to appreciate. People of different ages. You know, I'm in a different genders and different backgrounds of also is a good sign rather than a bad sign. Okay, it doesn't this work right now? Since 95. Is there, any other questions anyway? Everybody's little bit too short for that Shootin shop. When it's out in the next
few years on the cake review will surely be part of that. I think something that would be nice to provide what they need to do better and tons of one short shots. I pray that they could take from it for the teacher. I think you could go all together to have some really serious conversations. It's not just the outcome of the report it say it does conversation. We had various what extremes to get together and really do some deep thinking of what it takes to make sure that London does not
lose its lead. And now we need to make sure we stick together to implement that particular report. So it actually achieves all these potential. I agree with that. I would also add the thing that excites me because I I not only look at fintech. I look at Tech more. Broadly. This is an amazing blue blueprint that we can use for other Tech verticals. Whether it's around AI, Quantum, Health, Tech, Medtech, biotech, many different Tech verticals can look at this. In the other thing. I would just say it's been very
interesting for me to see the roll out of this. I was hit with a group of ambassadors from around the world, about 2 months ago, and the Brazilian ambassador to the UK said, we are all reading the Khalifa review, very closely, and I think the Khalifa review is coming to become in itself, a global brand. So, it's a great blueprint for how to do this for fintech, and I hope for multiple texts. Verticals going forward. Yeah, that's a great Point. Well, so thank you to both of you, and Russia will joining us today. And thank you to cook eggs for hosting us today. I'm proud of you for
joining both in the cinema, in turn, King's cross, and online. I hope you enjoy the rest of your conference as well.
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