EY FinTech Australia Census 2016

The inaugural EY FinTech Australia Census – a collaborative project between FinTech Australia and EY and EY Sweeney – is the most ‘detailed and comprehensive analysis of the Australia fintech ecosystem to date’, with crucial insights gathered from over 163 respondents. The final report is centred around the theme ‘Drivers of success’, with an analysis about the factors that influence commercial success split into 5 (internal and external) categories: strength of human resources, ability to raise capital, identifying consumer demand, regulation constraints and working environments.

Having a qualified, quality team with a passionate, committed leader is first driver of success for fintech corporations. Characteristics shared amongst successful fintech CEOs and founders included determination and drive; pragmatism and agility; and resilience and assurance. Interestingly, 87 percent of fintech leaders are male; they are highly educated (27 percent undergraduate, 65 percent postgraduate) and are engaged in the industry (attending an average of 0.43 fintech events each month). However, the report also highlighted a major issue in the Australian FinTech industry – that attracting and retaining talent was difficult, due to the ‘limited pool’ of ‘experienced start-up and fintech talent’.

Another fundamental key to success is having both the capacity to both raise capital and ‘manage the burn rate’ (i.e. managing the rate at which capital is spent). Large inflows of VC (venture capital) have being coming from both within and outside Australia, and 46 percent of fintechs reported meeting their capital raising expense needs. However, with around 1 in 5 fintechs burning more than $100k a month, there is a sizeable (37 percent) amount of companies who may not sufficient cash reserves in a year’s time.

Further insights about the need to identify consumer demand, establish government support and create strong support networks are also discussed in depth in the report; the paper concludes with an overall positive outlook for the future of fintech in Australia.  The summary report – which can be viewed here – provides a brief but informative snapshot of the accumulated research, while the full report – offering a more comprehensive analysis –  can be viewed here.