London has gained status as a global financial services hub and Startupbootcamp, one of Europe’s most prominent accelerators, have launched their latest programme aimed specifically at FinTech start-ups right here in the capital. In partnership with financial firms, including Lloyds Banking Group, MasterCard and Rabobank, Startupbootcamp have received applications from all over the world and panellists now have the tough decision of choosing just ten applicants to begin acceleration on 11th August 2014. Nektarios Liolios, Managing Director of Startupbootcamp FinTech, talks to bobsguide about the programme and what start-ups can do to standout in this competitive sector.
Tell me about Startupbootcamp?
Startupbootcamp is a group of accelerator programmes that started in Copenhagen 2009. So far we have run nine programmes and have around 135 teams. The programme starts with the rigorous process of testing the start-up applicants on their financial plan, their product and their team.
This year ten FinTech teams are chosen to come to London for three months, given €15000 and extensive exposure to mentors that help them to improve their product, their sales strategy and whatever else they need. The accelerator programme provides a way for start-ups to get the guidance and help that they need within three months, something which could usually take up to 12-18 months without the help of a programme.
Over 70% of our teams go on to receive funding after the programme and 80% of the teams still exist in the market today. As a programme we have gained experience and are becoming more successful because of the increased funding that we receive. Start-ups come to Startupbootcamp because of the success of the programme and also because of the great people that we work within the industry that help start-ups to develop their product.
Startupbootcamp is driven by a few core principles that stem from its Scandinavian roots. The main drivers are transparency, openness and the ability to provide a connecting platform for entrepreneurs. Fintech is one of the fastest growing sectors in the start-up world and London is the perfect location for Startupbootcamp because it’s booming. We believe that London is the financial services capital of the world, anybody who is anybody is in London and it was a logical choice to hold Startupbootcamp here.
You recently questioned 5,000 FinTech professionals about the state of the FinTech Industry and found that these professionals believe that the next wave of financial technology start-ups should focus on extending financial services to low-income and disadvantaged customers, not on serving consumers already catered to by companies – can you explain why you think this is and whether you agree?
More than 30% of the professionals we questioned listed financial inclusion as the sector that FinTech start-ups should focus on. Financial inclusion has two aspects; one is looking at the development in your own country such as the UK and the other is looking at large communities that have no access to banking such as Africa and South-East Asia. I agree that we should be focusing on less developed countries because there is a need for these services and in the future I predict that we will see a lot of innovation coming from these countries.
What are your panellists/investors looking for when it comes to a successful start-up?
MasterCard and Lloyds Bank are just some of our funding partners and they are looking for innovative start-ups that have lots of potential. Start-ups need to be able to engage with our funding partners, show that they can be a pilot customer as well as an inventor and know their way around data and APIs.
At Startupbootcamp we look for inspiring and eager entrepreneurs that can present a product that may not be perfect but has the potential to grow. We want FinTech start-ups to provide solutions to problems that financial institutions and companies already have and there’s nothing that hasn’t been invented yet which gives start-ups a lot of scope to develop something new. An idea that would really interest me is if a start-up was to develop something from the B2C market and turn it into a solution for the B2B market.
The FinTech sector is ripe for start-ups but other than applying to your programme what other ways can start-ups get recognised in this sector?
In the B2B sector it can take longer for start-ups to gain investment which is why they join programmes like Startupbootcamp. Outside of joining a programme like this, research is key when it comes developing a new product. Many start-ups don’t do enough research and then find out that their idea has already been created. It is important to indentify what you want to achieve with your product; whether you want to replace a competitor or work alongside similar products out there. Collaboration with banks and card providers is also really important because it helps start-ups to find out what problems they are facing and how they can provide solutions.
Mobile payment apps are huge at the moment what do you think a start up developing a mobile payment app could do to differentiate from what’s already out there?
Banks are developing their own mobile apps which means that there is less need for this solution now. However, if a start-up were to create a mobile version of a B2B product which allows Treasurers’ to authorise transactions on-the-go etc this would be a lot more interesting to me.
Do you think that more financial institutions should be considering investing in start-ups as a way of getting ahead of the competition and why?
Financial institutions are struggling to find the best ways to get innovation. There are many ways to find innovation such as; investing or partnering with start-ups and also from investing in programmes like Startupbootcamp. Some of the bigger banks have R&D (Research and Development) laboratories to source innovation and also participate in start-up initiatives, whereas some banks still have no idea what to do and ultimately will get left behind.
If you were in the shoes of your start-ups what idea would you pitch and why?
I would develop an idea that focuses around credit scoring because there are lot of people that do not have access to banking services due to the old system of credit storing. Another idea would be to focus on very specific back office problems because there are so many that are outdated and won’t be focused on by companies because there is risk and cost involved.