While the global fintech future looks bright, the next few years are key to Sydney’s FinTech Alley being the force it’s capable of being.
There are no shortage of big numbers when it comes to the fintech sector. Globally, fintech financing activity has grown from about $US100 million in 2008 to $US3 billion in 2013. And that is predicted to blow out to US$6-8 billion by 2018.1
So where is Sydney placed to take its bite? Where Silicon Valley still sits at the top of the tree followed by New York and London, where will the harbour city’s own new-born FinTech Alley be in five years?
According to Toby Heap, Managing Director of AWI Ventures2, it will dominate Australia’s fintech landscape. Speaking at NextBank Sydney recently, Heap had a “bullish” vision of Sydney’s FinTech Alley which centered around Tyro and Stone & Chalk’s two Clarence Street hubs.
“I see record numbers of bank talent will have left their jobs leading to around 200 fintech startups with multiple Australian accelerators contributing to 40 new startups a year with a focus on growth in Asia,” he said. “There will be five fintech-focused VCs based in Sydney with more than half a billion dollars in funds to invest. At that point the large institutions will attempt to buy the startups that are most disrupting their industry.”
Tyro CEO Jost Stollmann, who opened Australia’s first fintech hub in February, warned that Sydney had no time to sit still if it was to be a force.
“It’s catch-up. A lot is happening now. The next one or two years is key or the train will have left,” he said. Stollmann added that part of the fight would be breaking down the barriers of Australia’s “closed shop” banking system and these hubs “would make it uncomfortable for the big end of town”.
That industry disruption is central to the plans of Andrew Corbett-Jones who is heading the Tyro FintechHub. “Our hub doesn’t need to turn a profit, but it does need to drive disruption, and that’s what we will be measured on,” he said.
“There may be competition between individual fintech companies, but the fintech community must be defined by a strong sense of collaboration and a philosophy of giving before you get. The strength of clustering outweighs the risks. One plus one will equal three.”
Startups wanting to become a member of the Tyro FintechHub can apply at www.tyrofintechhub.com or by emailing firstname.lastname@example.org. Startups wanting to co-develop with Tyro Payments can apply using this form.
See Andrew Corbett-Jones’ full talk at NextBank Sydney here.
See panel discussion on Australian Fintech Scene in 2020 at NextBank Sydney here.
1 Accenture and CB Insights report The Boom in Global Fintech Investment, 2014
2 AWI Ventures is the fintech-focused ventures arm of Australasian Wealth Investments