- We asked several major venture-capital investors to tell us which London fintechs excited them.
- The companies cover a wide variety of products and services across the financial industry as digital disruption re-shapes everything from banking to insurance.
Business Insider spoke with some of the most prominent voices in venture capital to pick out the most exciting companies in London’s fintech industry this year.
Major fintech names to date have mostly been challenger or neo-banks which provide payment services, particularly related to foreign exchange and low-fee transfers. However, there have been some major new trends in the market, such as open banking, the rise of compliance, and a big move towards insurance technology.
London is the second largest city in the world for fintech unicorns and saw $5 billion in investment into the sector in the first half of 2019.
Read more: A fintech ‘brain drain’ is crippling once-mighty London: 10 UK start-up leaders contemplate life after Brexit
Here are the fintechs that VCs think are dominating in 2019.
Cited by these VCs:Rob Moffat (Balderton), Remus Brett (LocalGlobe),
Total raised:$13.3 million
What it does:Cleo is an AI assistant that connects customers’ bank accounts helping them to manage their finances through digital responses on Facebook Messenger.
Why it’s hot in 2019:Cleo’s really taken advantage of Open Banking and has grabbed the attention of over a million users in two years. They’ve moved quickly where banks have been slow in this space, according to Rob Moffat at Balderton Capital.
“Our plan for 2019 is continued international expansion and the development of additional products and services,” said Thish Nadesan, Cleo’s COO, in an interview with Business Insider.
Cited by these VCs:Rob Moffat (Balderton)
Total raised:$51 million
What it does:Zego is an insurance company that provides flexible cover for the gig economy including motorbike drivers and couriers with provisions dependent on usage and ownership.
Why it’s hot in 2019:Fractional insurance is disrupting the traditional space, with Zego providing a tech-driven approach to the sector. The London-based company has just launched its offering in Spain and is one to watch this year because “the demand economy needs insurance,” according to Balderton’s Rob Moffat.
You can read more about Zego here.
Startup:Mimiro (formerly ComplyAdvantage)
Cited by these VCs:Rob Moffat (Balderton), Index Ventures
Total raised:$38.2 million
What it does:Mimiro is a machine-learning platform designed to analyze the risk of financial crime between institutions in a globalized, interconnected economy where “know your customer” compliance is tricky and arduous.
Why it’s hot in 2019:Bank regulation is a hot area, and compliance takes up increasing amounts of time. Mimiro is set to simplify the process with a major focus on anti-money laundering and the company’s rapid growth to-date has been testament that its set to continue this year, having just raised Series B funding.
You can read more about ComplyAdvantage here.
Cited by these VCs:Reshma Sohoni (Seedcamp)
Relationship:Initial seed investment
Total raised:$772.7 million
What it does:TransferWise is a money transfer and payments platform with more than 4 million customers moving $4 billion a month through the service. Customers can also exchange between a variety of currencies through the platform.
Why it’s hot in 2019:Already one of Europe’s best known fintechs, TransferWise is tipped to boom once again this year given its innovative payments processing, according to Reshma Sohoni at Seedcamp.
You can read more about TransferWise here.
Cited by these VCs:Accel
Total raised:$324.7 million
What it does:Challenger bank unicorn Monzo is a digital only offering which has over two million customers. The neo bank offers savings and payments tools for its users and was valued at over $2 billion during its latest fundraise.
Why it’s hot in 2019:Monzo began its expansion plans into the US this year. “Monzo is reshaping consumer banking with a delightful user experience and a product that encourages financial wellbeing and trust,” said Andrei Brasoveanu, a partner at Accel, told Business Insider in an interview. “We’re big believers in the founders Tom and Jonas, who’ve built a company culture with an unparalleled level of motivation and transparency.”
You can read more about Monzo here.
Cited by these VCs:Index Ventures
Total raised:$336.4 million
What it does:Revolut is another of the UK’s leading neo banks replete with currency services at realtime exchange rates and access to cryptocurrency markets.
Why it’s hot in 2019:Revolut has been expanding worldwide so far this year with a recent beta launch in Australia ahead of continued rollout across the US this year underling the challenger bank’s global ambitions.
“Revolut is one of the most product-focused, innovative, and customer-obsessed companies I’ve worked with,” said Martin Mignot, partner at Index Ventures. “It’s why even with very little marketing, they have attracted more than 6 million customers around the world.”
You can read more about Revolut here.
Cited by these VCs:Remus Brett (LocalGlobe), Carolina Brochado (Softbank)
Total raised:$40.8 million
What it does:Tide provides loans to businesses and other SMEs via an app-focused platform which is helping to plug the gap left by banks. The company also recently won a £60 million ($80 million) grant from the Royal Bank of Scotland’s competition remedies fund.
Why it’s hot in 2019:While Europe has seen a meteoric surge in challenger banks in the consumer banking space, the business sector is far less populated. Tide has been touted as a company capable of expanding its offering into a sector which is “very attractive to disrupt,” according to Remus Brett of LocalGlobe.
Cited by these VCs:Matus Maar (Talis Capital)
Total raised:$352.7 million
What it does:Iwoca is another SME loan provider and supplies finance options to companies in the UK, Germany, and Poland. The company has been steadily growing its loan book and has a large machine learning infrastructure in place.
Why it’s hot in 2019:The market for disruption to the business lending sector in Europe is vast and poorly serviced. Iwoca’s continued growth and impressive tech have led to investors to be “super bullish about this company right now,” according to Matus Maar at Talis Capital.
Cited by these VCs:Munish Varma (SoftBank)
Total raised:$1 billion
What it does:OakNorth is an SME lending platform which focuses both on origination and credit portfolio analysis.
Why it’s hot in 2019:OakNorth got $440 million in funding from SoftBank in February making it one of the best funded fintechs worldwide. The company expanded into the US market and signed a partnership with Dutch bank NIBC recently, underlining OakNorth’s growing reach.
“OakNorth is delivering a highly differentiated service to a key segment of the market that has historically been underserved by commercial banks”, said Munish Varma, Managing Partner at SoftBank Investment Advisers, said to Business Insider. “The company has a clear and ambitious vision to scale globally and we are excited to work with them to achieve this goal.”
Cited by these VCs:Matus Maar (Talis Capital)
Total raised:$110.3 million
What it does:Founded in 2012 by three Oxford University graduates, Onfido is a software company that helps businesses verify people’s identities using a photo-based identity document, a selfie and artificial intelligence algorithms. Security is a major concern in financial services with the company’s authentication services in high demand.
Why it’s hot in 2019:Onfido’s ID verification technology is propriety and a lot of its service powers other fast growing fintechs such as Monzo and Revolut.