Eric van der Kleij leads the Level39 FinTech Accelerator programme for Canary Wharf Group and is the former head of the Tech City Investment Organisation.
He outlines his vision for financial technology (FinTech) and explains how Canary Wharf aims to play a leading role in the sector.
Technology and financial services are, in their own right, two of London’s powerhouse industries; however, the big opportunity for the UK economy lies in bringing these worlds together.
This fusion has already led to a rapidly growing sub-sector called FinTech, a popular term for technological innovation in financial services, but we are still only scratching the surface.
The right kind of FinTech has the potential to facilitate tremendous growth for London and the UK, helping the economy to move forward after several very challenging years.
My background is in financial services technology, setting up Adeptra, then working with the UK Government in 2006 to establish its Global Entrepreneur Programme and subsequently the Tech City Investment Organisation (TCIO). This experience has helped me understand the huge transformative potential of FinTech. It is an awareness shared by the team at Canary Wharf Group, who brought me on board in September last year to shape their technology strategy.
ICT & Financial services are a key part of the UK’s GDP
In figures, the potential opportunity becomes more apparent. According to TheCityUK’s latest research, the combined Financial Services and ICT sectors’ contribution to UK’s GDP is a whopping 12.1%.
Financial Services is one of the UK’s only world-class export industries, serving markets around the world from headquarters here in London.
If small FinTech firms can successfully break into one or more large firms based in Canary Wharf or the City, their potential for global, exponential growth is enormous.
It presents the UK’s best chance of creating world-class, scalable, international technology firms in a short space of time.
In the process, such companies can potentially solve some of the major issues facing the world of finance, while creating valuable export receipts and jobs.
The benefit of the symbiotic relationship is more than pure economics
Sharing of talent, investment and infrastructure are also crucial to success. Financial services employ over 2 million people in the UK, presenting a vast talent pool. Technology companies want to be located as close as possible to their potential employees and sources of investment, not to mention places to socialise and have fun.
Nine of the top 20 global FinTech companies already have a UK HQ within London
This is an impressive statistic which shows we are already doing some things right. However at present, London is lacking a place where financiers and technology engineers can effortlessly converge, collaborate and innovate, which has both the talent and infrastructure to support the next generation of FinTech innovation to fuel the growth of the industry.
And it needs to be the right kind of innovation, helping the major financial service providers to better meet the needs of clients and customers in an efficient, transparent and compliant way, adding value while alleviating risk to the wider economy.
It was with this vision in mind that the Canary Wharf Group created Level39, Europe’s largest accelerator space for technology businesses innovating in the Financial Services sector.
Level39 will open in March 2013, on the 39th floor of the iconic One Canada Square, and will be an office and social space for technology companies to create, test, market and deliver world-class financial technology products and services.
To complement, not compete with
To be clear from the outset, part of the wider Tech City cluster, we intend for Canary Wharf to complement, not compete with, what is happening around the Silicon Roundabout and London’s other tech clusters. It makes sense for London’s clusters to specialise. Canary Wharf has been successful to date by offering property and services that cannot be found elsewhere in London, and the intention is to do the same in the technology space. We see Canary Wharf very much as part of Tech City and we will work closely with the Tech City Investment Organisation to help grow our part of the cluster.
Level39 will feature ‘sandboxes’ which will enable software engineers and builders of platforms to experiment with products and services in a safe, ring-fenced trading environment.
There will be a new 200-seat event space to host regular industry events and demonstration days. A unique ‘Technology Tunnel’ will display live data and interactive technology, allowing visitors to engage with thought provoking ideas and content from Level39 companies. Semi-open and open-plan office areas will service the needs of early-stage and growth phase businesses, while a kitchen/cafe area will make it easier to meet potential clients and partners, investors, mentors and other entrepreneurs over a coffee.
We will also have the Level39 Business Club Lounge, a membership-style club attracting leading industry figures and investors, with subsidised membership offered in many cases to experienced people prepared to make themselves available to mentor Level39 startups.
Access to potential customers is very important; I know from my experience with technology entrepreneurs that financial services companies are not always easy to connect with. Even the most talented and entrepreneurial companies can lack the visibility and access needed to engage with their potential customers. To help make this easier, all the startups, potential customers, ‘entrepreneurs in residence’ and experienced business owners and investors using Level39 will have ready-made space for advantageous ‘collisions’ to take place and ideas to percolate, even if it is just around the coffee machines.
Fintech is our birth right
We aim to give companies using Level39 the optimum environment for success, and we hope that they will consider Canary Wharf as a business location beyond their time at Level39.
It is a model that should assist angel investors and venture capitalists, because it allows the problems that beset FinTech companies working in isolation to be resolved during development, through interaction with mentors and entrepreneurs in residence. It should help to de-risk the process of investing in startups as they enter their growth phase.
FinTech is London’s birth right, with huge potential for growth in the future. At Canary Wharf, we look forward to helping establish the UK as a driving force in the FinTech revolution, significantly transforming the world of finance for the better.