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The future of fintech: Zooming in on the North East

Thursday July 27, 2023

In our latest article, we focus on findings from our latest report relating to the North East

The North East’s fintech sector faces an uncertain future, with more than half flagging the potential risk of failure by the end of 2023, according to our research report.

In a poll of businesses in the fintech hubs of Newcastle and Durham, our data highlighted that 56% of firms in the sector weren’t confident in their ability to trade through the next six months, as challenges relating to inflation and interest rates persist.

Indeed, just over a third (34%) expect their valuation to decline over the next year.

With a high proportion of firms concerned about their futures, the research highlights a polarisation in the market in terms of funding – suggesting a fight for quality among venture capitalists and lenders. Against a backdrop of rising interest rates, more than half (52%) have found funding harder to come by over the past 12 months – the highest proportion of any UK nation or region surveyed. Just under two-in-five (38%) accessing finance with greater ease.

This polarisation is also apparent in firms’ plans for the future. Three in five (60%) of the business leaders we polled said that they had reviewed and amended their exit strategy in the past year. The most popular option was seeking new funding or investment (50%), followed by seeking new consolidation options (47%).

A fork in the road: The future of UK fintech

While other regions appear more bullish, the North East has a healthy fintech community, led by people with real drive and creativity, and we can remain confident in the sector’s potential.

For those eyeing both investment and consolidatory support, the coming months will be crucial in optimising their commercial operations and future profitability to develop the best proposition for would-be suitors.

Click below to read the report

Against the odds: The future of UK manufacturingfintech

 

Related team

Shaun Hudson

Shaun Hudson

Shaun Hudson

  • Director
  • Restructuring Advisory
  • Newcastle, Sunderland