London has become a hub for FinTech innovation

Peter Jones Dec 02, 2014

After a packed day with panels giving in-depth information on regulatory requirements and developments in pricing methods at the Valuation Risk Forum in London on 26th of November, it was refreshing to end the conference on a positive note – London is a true hub for innovation in financial technology.

The FinTech Stars panel, which created a buzz on Twitter as conference-goers were tweeting about the fascinating discussion, welcomed the CEOs of some of the best start-ups in the financial technology risk analytics and capital markets space to the stage: BondCube, Derivitec and FactEntry.
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Panelists commented that London stands out in terms of financial technology activity, as London is not only a good place to set up a new company, but there’s also a lot of talent that’s been thrown out of financial firms in recent years. London is full of talented people with new ideas who are brave enough to start up new ventures, they said.

The challenge for new companies, however, remains getting funding. The advice from the panel was for entrepreneurs not to take the leap unless the plan was to self-fund the business for two years. Despite the panel at the conference representing three companies that can disrupt the fixed income market, it is not easy getting funding without traction, they explained.

To get funding, the panelists said you first need traction and clients. Funding conversations can then possibly progress with existing clients or industry players who understand the business and product offering. When speaking to professional investors, panelists highlighted that one of the challenges for niche businesses in financial technology can be that investors who don’t specialize in this area might not understand the company’s business model and will therefore not invest either.