London the fintech capital, says US growth investor

US growth investor Motive Partners, which focuses on fintech projects, has chosen Canary Wharf for its new European hub. “You can’t claim to be an important investment management or private equity player in financial technology if you’re not at the epicentre, which is London,” said Motive’s Rob Heyvaert.

2017 was a record year for UK tech investment, with London-based firms attracting the lion’s share of funding, according to data from London & Partners.

Real Business* has, this week, unveiled ten technology companies that raised £80m and over in 2017. According to the report, the most active regions were London and Ireland, which were responsible for 58 per cent and 12 per cent of deals respectively. Fintech was a large area of focus, with the industry featuring most prominently in top ten list of “massive investment deals,” including:

(4) Acorn Oaknorth – Amount raised: £251 million
In short: This “bank for entrepreneurs, by entrepreneurs” has reached unicorn status. The investment was said to be used to boost lending capability by £1.5bn, with the hope that it would add additional jobs in the UK. The company also planned to use it to roll out an in-house lending platform.

(6) Neyber – Amount raised: £98 million
The platform, ensuring financial wellbeing for UK employees, used its cash injection to grow its salary-deduction loan product. Much like Acorn Oaknorth, it plans to increase the amount it can lend.

(8) Funding Circle – Amount raised: £83 million
Funding Circle has been hoping to expand its presence in the mobile app space by launching two separate apps (one for Android and the other iPhone) for its investors. New hires were its second port of call, with the company having recently hired its first ever commercial head of retail investments.

(9) Atom Bank – Amount raised: £83 million
The app-only Atom Bank will also be able to lend more money to SMEs after this specific cash injection. The capital will be used to roll out a new range of products, as well as boost corporate growth.

(10) Tandem – Amount raised: £80 million
Challenger bank Tandem hoped to gain growth off the back of this finance. More importantly, however, it signed an agreement in 2017 to acquire Harrods Bank. This, the bank said, would accelerate its launch of savings accounts.

Commenting recently on London’s fintech sector, the Mayor of London, Sadiq Khan, said: “Technology entrepreneurs and businesses are attracted to our great city for its diverse talent pool and unique business ecosystem and I am determined that London remains open to investment and the best tech talent from all over the world.”

Last year saw a number of the world’s leading tech companies pledge their long-term commitment to the capital, with significant investments from Amazon, Apple and Google. In the second half of last year, Spotify announced it will expand its R&D operation in London and double its headcount, while US tech giant Facebook confirmed it will create an additional 800 jobs for its new London headquarters.

Beavis Morgan – Specialist business advisers to London’s tech sector

At Beavis Morgan, we work with a number of entrepreneurs and startups, helping them set up and run their businesses, whilst navigating the challenges and advising them on making the right decisions both now and for the future.

We also understand that whether you’re a startup or a well-established business, cash is king and managing its flow is crucial to your immediate and long-term success. That’s why our independent finance brokerage, BM Structured Finance, is readily available to assist startups source the right funding for their individual needs.

For more information about how we can help you and your entrepreneurial business, contact Steve Govey, Partner within our Beavis Morgan Entrepreneur Support Team, or Simon Belton at BM Structured Finance.

* Source: Real Business: 21 March 2018 – Technology companies that received the most investment in 2017