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Fintech’s golden age: From competition to collaboration

As fintechs move from competition to collaboration, Wall Street has an opportunity to advance.

Overview

Over the past five years, global financial technology (fintech) financing has grown rapidly, but the share of fintech investment directed at companies looking to compete against the financial services sector has remained relatively stable at 62 percent. In New York City, however, that explosive growth has coincided with a dramatic shift toward collaboration. As a result, the city is quickly becoming the global center of a new kind of fintech innovation.

A recent Accenture report takes a closer look at what makes the fintech landscape in New York City unique, how the financial services ecosystem is evolving in this collaborative environment, and what steps financial institutions can take to stay in the game.

Fintech’s Golden Age

DOWNLOAD THE FULL REPORT [PDF]

Key findings

Between 2010 and 2015, global investment in financial technology (fintech) ventures rose from $1.8 billion to $22.3 billion. During that same period, the number of fintech deals more than tripled, from 269 to 896.

North America leads the way with $11.4 billion—more than half of total fintech investment around the world. In fact, New York City is quickly emerging as the global center for fintech innovation with roughly 10 percent of fintech investment worldwide. In the first quarter of 2016, the city received more fintech financing than Silicon Valley for the first time ever.

Even more interesting is the shift toward collaborative ventures in the city. Between 2010 and 2015, the share of fintech investment directed at collaborative ventures in New York City more than doubled, from 37 percent to 83 percent. Worldwide, that figure remained relatively stable at just 38 percent.

Golden age of Fintech

Robert Gach

Managing Director – Accenture Strategy, Capital Markets Lead

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Competition to collaboration

In 2015, banks participated in less than 10 percent of all reported fintech venture deals, totaling less than $5 billion. During the same period, those same financial institutions spent the better part of $50 billion updating decades-old mainframe and information technology infrastructure.

As financial institutions begin to embrace fintech innovations, and the US regulatory environment makes it increasingly difficult for fintech companies to grow and scale on their own, fintech collaborations have the potential to fundamentally change the financial services ecosystem. Accelerators like the New York FinTech Innovation Lab, co-founded by Accenture and the Partnership Fund for New York City, will have an important role to play in bringing partners together.

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