Take that, banks: The UK’s online financial marketplaces attracted $253m in VC money last year as LendInvest, Transferwise and Funding Circle made their mark
Financial marketplaces – crowdfunding platforms and other fintech sites – have proven irresistible to the City, it turns out, after figures released today showed venture capital funding for the sector has shot up five-fold in the last two years.
Data released today by payment startup Stripe showed investors are backing developers in their bid to reshape how people buy and sell online – with UK financial marketplaces attracting $253m (£176.9m) in VC cash last year, up from $43m in 2013.
The figures suggested companies such as LendInvest, Transferwise, Funding Circle and Crowdcube, have cemented their positions as serious competition for traditional banks.
Overall venture capital funding in the UK's marketplaces, which includes service companies such as Deliveroo and Secret Escapes, jumped from $334m in 2014 to $850m in 2015 – more than eight times the $103m invested in 2013.
"More and more fintech startups are using code to seamlessly move money between buyers and sellers, lenders and borrowers, and entrepreneurs and investors," said James Allgrove, head of UK growth at Stripe.
The figures came just over a month since London emerged as the dominant force in the European fintech sector.
A panel of judges from VC and technology firms, including Google, Microsoft and American Express, put 24 of the capital's fintech companies in the Fintech 50 – a list of the top fintech startups based on growth, distribution and market impact.