Always Do you want to join the fintech industry? It’s no secret that the industry is experiencing what can best be called growing pains, but applying for jobs at the biggest companies is not the only way to enter. It might not be the best either…
At the Sifted Summit 2023 in London this week, a panel including Wise co-founder Taavet Hinrikus, Latham & Watkins partner Mike Turner, OLIO founder and venture partner Tessa Clarke, and Eileen Burbidge, partner at venture capital firm Passion Capital, evaluated the startup space. Everyone seemed unanimously optimistic, especially when it came to small or new fintech companies.
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“In 2021, the world was a little crazy,” Hinrkus said. “Everyone who came from Google got funding.” For many of these companies, he compared their business model to “selling a $100 bill for $95.”
Funding may be less crazy now, but Turner said the situation isn’t completely dry. “There is a veritable wall of capital waiting to be deployed,” he said. “LPs are back in the game.” However, he’s not exactly optimistic about the biggest fintech companies: “There will be some very large, high-profile bankruptcies in the next six months.” »
Instead, the best fintech companies to work for right now might be smaller companies, which are best positioned to secure venture capital funding. Burbidge, who invests in start-ups (he was an early investor in Monzo), said investments in start-ups are “largely insulated from big swings”. On the contrary, current conditions are better for them, because “the market has fallen in terms of entry prices”.
If you’re looking for a job in fintech, working for a startup can also be much more lucrative. THE eFinancialCareers Financial Technology Overview found that, for fintechs with fewer than 100 employees, teams of ten or fewer earned the highest salaries on average.
What makes startups so popular with funders? Hinrikus, who also founded and runs venture capital platform Plural, says “investments are made by people who have scar tissue from starting their own business” and should be able to learn on their own errors when analyzing new businesses.
As for the types of fintechs you should want to join (or find), AI seems the obvious betbut it is not a free path to success. “You can’t not invest in AI startups,” says Hinrikus, “AI will be deployed in every business.” Although it is considered the crypto successor of some venture capital funds, it instead compares its impact to what smartphones have done across industries.
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