By Eric Johansson
Malcolm Leach is the CTO of Funding Options, the fintech startup. The venture launched in 2011. The company has raised US$17. 8m in investments since then, according to Crunchbase. The venture has also expanded from its native UK. It now also operates in the Netherlands.
Leach joined as CTO of Funding Options in April 2022. He has previously held roles at Universal Music Group, Cap Gemini, Swiss Life AG, Virgin Media and iCrossing. He joined Funding Options after three years at cash deposit fintech Flagstone.
While the CTO is reasonably new in the industry, he believes Brexit hasn’t hurt the UK’s fintech industry yet. As an example, he points towards Funding Options’ own recent European expansion.
However, not everyone paints an equally rosy picture of the economy. The think-tank Centre for European Reform recently estimated that Brexit had cost the UK £31bn(US$37.12billion) in GDP losses by the fourth quarter of 2021.
The UK tech sector worth passed the US$1tn mark in March 2022, according to data by Dealroom analysed for the UK’s Digital Economy Council. Digital minister Chris Philp leaped upon the opportunity to celebrate the industry’s achievements. However, market stakeholders we spoke with at the time believed Blighty would’ve passed that milestone much earlier if it hadn’t been for Brexit.
The markets have been merciless for fintechs this year. A barrage of bad news has pummelled the sector. Headlines about investment cooldowns, mass layoffs and plummeting stock valuations have beaten fintech entrepreneurs in the face for months.
Fintechs also have reason to be worried when it comes to funding. Fintech funding dipped slightly at the start of the year. In 2019, VCs injected over US$32.1bn into the fintech industry across 1,821 deals, according to data from research firm GlobalData. That figure surged over the next two years. Fintech ventures raised over US$84.5bn across 2,356 deals in 2021. The industry has raised US$23.9bn across 750 deals in 2022 so far.
In this latest instalment of our series of CTO Talks we also discuss what people get wrong about SME funding and if artificial intelligence (AI) is finally realising its potential.
Eric Johansson: Tell us a bit about yourself – how did you end up in your current role?
Malcolm Leach: It’s fair to say that working within fintech is still a relatively new thing for me. Prior to joining Funding Options, I spent three years at Flagstone, a leading fintech in the cash deposit space. During my time there technology revolutionised from being a blocker to an enabler of growth, due the hard work from across the business to focus on scale. We didn’t only change the tech but also the way the company was structured, from departmental to mission teams. Our first major win for our new platform was a cash deposit partnership with Revolut followed by many other partnerships.
It felt like the right time to move on, and when this role at Funding Options came along it ticked all the boxes. Having both founded a business before and experienced a number of corporate working environments, I know the size of a company I like to work in – not so small that you wear 50 different hats, but not so big that your impact is limited. I loved [the CEO] Simon Cureton’s vision for the company and where he wanted to take the business, so it was pretty much a done deal following that conversation.
Funding Options is one of the earliest players in the UK’s fintech boom. As such, how do you think Brexit has affected the industry?
Having only been in fintech since 2018, I don’t have as much of a comprehensive view of the market prior to that. At Flagstone, I don’t think Brexit affected things at all as it was a mostly UK-based business in the same way as Funding Options is. If we were pan-European then there would have been a much more significant shift.
Funding Options obviously has expanded to the Netherlands but there weren’t huge impacts on us. I feel that’s one of the major advantages with fintech, Brexit hasn’t affected us as a sector or limited our potential for expansion in the same way it has with others.
What is the biggest challenge you will face in your new role?
The biggest challenge for CTOs is always landing big fish on light tackle. We’re generally not short of ideas but we do have a commercial business to run, so we have to make choices. You need to work out where to place your bets to ensure the important aspects of the platform are built to improve the position of the business.
Beyond this, the ongoing challenge for every manager is motivating your team and helping them to work cohesively. This is a challenge.
