In June, we published an article on advantages and pitfalls of Brexit in the fintech business. Now, two months after Brexit, let’s look at what is occurring in the London fintech sector. The UK has been a leading fintech hub, supported by the UK government investment initiatives helping investment in the rapid growing sector through the EIS, SEIS, Startup Loans and more.
Nevertheless, this could readily change, according to many startups investors and executives, a few of whom are challenging their future in the UK.
Recently, the American Damian Kimmelman, the creator DueDil data business, told Forbes that he desires his business to be an international business and not a British one. He stated that he cannot expand his company in the UK because of talent pipeline shortages after Brexit.
TaavetHinrikus, the co-founder of Transferwise Company, told the Guardian he is considering relocating his company’s head office to a different city. Nonetheless, there isn’t any final decision that is made. Transferwise has a valuation of more than $1 billion and over 400 workers.
Based on Fundbase, statistics reveals that 7 out of 10 fintech companies are considering moving their HOs out of London. Relocating their headOffice out of UK has been their principal topic of discussion. According to Eileen Burbidge, a partner at VC firm Passion Capital, there is absolutely no possibility of the British government re-instilling their faith in the fintech industry,
For the very first time in fintech history, China is bringing more VC backing for fintech than the USA. Based on Sameer Gulati, policy advisor of Innovate Finance, China is becoming an powerful competition to UK fintech businesses searching for capital.