UK fintech is surging. How can businesses stand out?

by maria
Editorial & Advertiser disclosure

Kat Jackson, Associate Director, The Media Foundry

The UK fintech scene is in especially rude health.

In the last month alone, we’ve seen the largest ever fintech float. Investment in the sector has broken records, hitting a massive $24.5bn in the first half of the year. This upsurge shows no sign of stopping – London is the second most active city in the world for the sector, after San Francisco. However, other hotspots are opening up around the country for fintechs looking to set up outside the capital. It not only a hot fintech summer. It’s been several years now of simmering growth.

This effervescent sector carries with it some expectations. Entrepreneurs starting up in the field will be setting out with big dreams, not only to change the world and fill their specific tech niche, but to also make big deals at a set time and bow out with a sizable golden goodbye. Of course, not every start up makes it. But with such heat in the sector, it seems a more realistic outcome. Beauhurst is tracking over 1,300 fintech start up or scaling businesses as per its last report into the sector, over 70% of which are based in London. This is a crowded market, and with such sizable pot of gold potentially at the end of the rainbow, it is only going to get more so.

A thriving sector creates opportunity, but that opportunity heightens competition. It also makes it much harder to differentiate between businesses. Fintech is a deep sector, it spans a range of both b2b and b2c services. And yet as companies proliferate in the deal rush, it becomes much harder to pick between them. Tech can also be complicated for non-specialists – investors in the market will know their stuff if fintech is their thing, but if the masterplan is focused on a bigger fish to dangle that deal in several years’ time, companies should consider their roadmap about how they want to get there – and what they will do to make their service stand out.

What these businesses often do not recognise, at least not quickly enough, is how valuable their own stories can be and the power in taking charge of their own narratives. The brains behind the tech tend not to consider their own marketing as a key concern. Development of the tech is absolutely critical to build the business, but it is also important that companies look outside to the market to build their profile while they also shape their offering. To do that, they should develop an idea of the kind of investor they are looking to attract. There will be a roadmap for the company and its development, and this kind of thinking is a useful destination to keep in focus as the company grows, for business decision making but also as it will influence where the business should be seen.

Keeping that end ideal in mind keeps that plan on track. After all, if you never attempt to get your business in front of these people, how will they learn about you? How will they hear about your work and your unique place in the market? If you’re going to change the world, it’s important to tell people about it. It’s even more important if the people to your left and right are also looking to change the world, in different ways.

This is also the point where a lot of businesses start to panic. Isn’t it a huge commitment to focus on discussing the growth of the business? Won’t we risk sharing our ‘secret sauce’ with potential competitors? What makes us special? The truth is, if you don’t take charge of your own story, one of two things will happen. Either no one else will – and the oxygen and buzz around the business is minimal. Or, someone else takes charge – competitors spying a threat, or more damaging industry wide interpretations the company, the tech, and who it’s for take over.

We’ve advised a number of businesses looking to work towards a sale – it’s often a third or fourth objective, and typically highly confidential. But it’s an imperative to know as it means that, as consultants, we can help the business to take the right steps towards gaining the right kind of attention. A well-structured communications campaign can make the business magnetic to the right kind of audiences – while also delivering knock on benefits to the business in the form of educating new business leads, keeping staff informed and excited, celebrating business milestones and taking advantage of the specialist knowledge housed within the business to help that business to grow along the way. It’s a marathon, not a sprint to attract the right kinds of investor attention, and it can take some time. I’ve also seen it accomplished through a single article publication.

Analysts are already predicting that this hot period for UK fintech could slow – there are so many factors which can influence the investment volumes into the space, especially for early stage businesses. There are also factors like the diversity of these businesses, the UK’s perceived digital skills gap, and increasing trends like ESG considerations which will soon begin to shape these deals. Companies need to stay agile to these factors and consider how their business’ awareness will have to evolve to keep pace with developing investor desires. The best way to approach these issues is to make sure they are part of your company story and planning in the long term, rather than rushed considerations when the investment rounds are underway.

Fintechs who plant the seeds of their story now may find themselves reaping the best harvests in years to come.

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