David Anderson: Fintech sector set to be a Scottish success story

What a time to be at the start of your career looking at the possibilities ahead. The recent news that 20 graduates from Edinburgh's Code Clan '“ the UK's only accredited digital training skills academy '“ had been accepted into jobs in some of Scotland's brightest fintech firms was for me an illustration of the potential of the sector.

David Anderson is a partner with Addleshaw Goddard

Fintech, in case it has somehow escaped your notice, is financial technology – software developed to tackle financial services issues like payment, security, fraud and so on.

It’s best-known for producing start-ups, but is also being adopted by established financial services institutions keen to harness the disruptive potential of digital tech in a world where change is constant and rapid.

Initiatives like Code Clan, combined with the way in which organisations like Scottish Financial Enterprise and others, have created a reputation for Edinburgh and Scotland as a whole as a fintech centre for the UK. The Scottish Government has also made it an economic priority – a good move when tech is such an essential part of our lives and when we live in an economy based around strong financial services.

It’s this sort of momentum which encourages confidence and investment. Scotland’s fintech ecosystem is attracting substantial support from across the public and private sectors, taking a nascent industry into a serious economic force.

We recently launched our own initiative to support the sector, a UK-wide search for the brightest fintech stars of the future. AG Elevate provides legal mentoring and support to fintechs we think have what it takes to grow a scalable, sustainable business. It’s our second year of the initiative, but our first year in Scotland, since Addleshaw Goddard itself is still only six months old here.

There are two programmes – one targeting ‘early-stage’ start-ups with no more than £1 million of investment, and one directed at start-ups with at least ‘Series A’ funding of more than £1 million. Both packages offer mentoring services and free legal advice, together with access to AG’s training sessions and networking events.

One of last year’s cohort, Cardiff-based Delio, helps a wide range of organisations connect ultra- and high net worth and family office capital with private investment opportunities to enhance their offering. Delio does this through a series of interlinked white labelled digital platforms and launched its initial version of the solution in May 2016.

We know Scotland has more than its fair share of talented fintechs, and at a time where economic data doesn’t always make for particularly encouraging reading, there’s comfort in the exceptions. We’re lucky as a country in that we have a number of exceptions – look at the ongoing success of the food and drink sector, for example.

Economic success, like commercial success, is all about backing winners. It’s clear that fintech has more than a fighting chance of being a real success story for Scotland; even more impressive in the context of several UK cities finding their swagger in emerging tech. Birmingham’s tech community, for example, has created its own promotional body, Silicon Canal, to show the city’s selling points to investors and multinationals.

But, for my money, Scotland is already at the leading edge of the fintech sector – we’re a few steps ahead. And I think we’re only just beginning to see the future possibilities emerge. If I was one of those Code Clan graduates, I think I’d be feeling pretty good about the journey ahead.

David Anderson is a partner with Addleshaw Goddard