New York has a unique opportunity to profit from a technology revolution that plays directly to its strength as a world financial center. Since 2008, global investment in financial services technology (“fintech”) ventures has tripled to nearly $3 billion. The dramatic changes underway in financial services, driven by new digital technology, regulations, consumer behavior and the need to reduce costs, mean this trend is set to continue.
The opportunity for New York, with its huge financial center, lies in the fact that banks, capital markets firms and insurers have increasingly opened their eyes to the benefits of having a fintech cluster close to home. It allows entrepreneurs and financial institutions to work closely together to ensure that innovations are tailored to the specific needs of the financial industry and its customers.
Global investment in financial services technology ventures tripled between 2008 and 2013 to nearly $3 billion.
The United States received 83% of global fintech investment in 2013.
New York has made much progress in establishing itself as a leading fintech center, but it faces down a number of obstacles that affect its ability to attract influential capital. For example, the city needs to raise awareness of the fintech successes that it has fostered in recent years, as the city’s relatively low fintech profile affects its investment levels.
New York City has unique advantages in fintech and has every chance of being the prime beneficiary of a boom in fintech investment. New York is already the fastest growing fintech cluster in the US, with a rapidly growing ecosystem comprised of startups, capital, talent, educational resources and fintech accelerators, like the FinTech Innovation Lab.
To realize its full potential, New York’s fintech supporters must raise awareness of its advantages and successes. New York must build upon its existing momentum to create new champions by capturing the attention not only of leading financial institutions but of entrepreneurs and venture capitalists from all regions.