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One upon a time, UK’s manufacturing led the industrial revolution. And my adopted city, Manchester played a significant role during the industrial revolution thanks to the booming cotton trade at the time.
As manufacturing moved to low cost labour markets, London became the centre for the financial services industry. Starting with trading stocks and commodities, the market boomed as financial wizards brought innovation through new instruments. With subprime mortgage fiasco in 2008 and the subsequent bailing out of banks, the industry lost a significant trust. Whilst pays are still high, it no longer offers the dream job for graduates.
Over the last five years, the focus shifted to tech for innovation. Despite dodging my question on wealth creation, David Cameron has become a champion of this push (he was campaigning in Greater Manchester before the last election). London has become a Tech City we can all be proud of. Yes, we too in Manchester are trying to take advantage of this boom. I’ve played my part running over 100+ tech events from 2006 to 2012+ bringing tech entrepreneurs, investors and deal makers together. We even had a black tie awards ceremony focusing on celebrating tech entrepreneurship (I sold it to boutique tech investment bank, GP Bullhound).
The next frontier is almost upon us combining financial with tech, the new fintech boom. Could London take a dominant role in this? Level39 based out of Canary Wharf recognised the importance well before most others. Today, Barclays are working with my buddy Jon Bradford’s Techstars (Barclays Accelerator).
Where does ?#?Manchester? fit into all this? Should TiE’s Founders Dock based in Spinningfields take the lead?
With FinTech’s ability to disrupt, this is where Supply Chain Finance (#SCF) become a really interesting market to get into. Once I attempted to disrupt the incumbents by bringing out an innovative electronic document exchange (e-invoicing hub). Those days products were built to be independent with no regard given for the connected world. Today, you build the API before you even write the first line of code for the product (we actually did this for a product called CRMPlus).
I predict that the FinTech market will involve in two fronts. Firstly, incumbents expanding into new services leveraging the existing networks and financed by the balance sheet and/or private equity. Secondly, new techstartups offering niche services, evolving at lightning speed on the back of venture capitalists.
Get ready to see a boom in FinTech over the next 18 months, especially as incumbents start launching new services.