27th June 2016
The electorate has voted for Brexit, therefore we must focus on embracing the circumstances and what the future might bring. Doom and gloom is a dangerous outlook, and a potentially self fulfilling prophecy, so we must move forward quickly, despite many people’s disappointment with the Brexit outcome.
In the past five years, the UK FinTech sector has worked tirelessly and developed an armory of regulated, pioneering financial technology companies that are envied the world over. Crowd2Fund and its peers now have an even more important role in firstly stabilising and then continue growing the overall local UK economy in the short and long terms.
This article outlines a few immediate things to be considered for businesses and investors alike.
Short term capital requirements for British Businesses
Our initial role will be to provide a much needed source of capital for Britain’s growing businesses. Capital is available for these businesses via Crowd2Fund in the high likelihood that banks reduce their lending. Crowd2Fund is the only regulated Innovative Finance ISA manager authorized to access the UK IFISA reserves of £480bn for small businesses.
World class, state of the art financial infrastructure
Crowd2Fund is architected to facilitate inbound UK investment from 163 different markets (both inside and outside the EU), in a legal and compliant manner. This means that even more funds are potentially available to grow the real economy and support the underlying fundamentals, such as job creation and GDP growth, by financially supporting UK businesses. Our brand new platform includes the ability for people to do this from a fantastically easy to use mobile phone app (iOS), almost anywhere on the planet.
Exporting British business like never before
In a global, borderless, digital society, the concept of exporting moves beyond services and goods. With Crowd2Fund, we can export our businesses credit needs and even sell equity stakes in businesses to international investors with remarkable ease and speed. A drop in the value of sterling could easily lead to cheaper credit for businesses, and also an increased opportunity to find international investors, due to the lower exchange rate.
Lower sterling means more attractive UK based opportunities as they are cheaper to investors outside the UK. As such, British businesses need to consider the benefits of the Brexit scenario we are now in.
Access to 3.4bn consumers via the internet on fresh terms
British Businesses now have access to the world’s investors and savers on fresh and new terms. Old and new friends will be called on, including India and China. It will be important to establish revised terms with the EU as quickly as possible and, in the meantime, adjust our focus to include non EU markets in neutral capacity. There is huge opportunity for international markets to access British goods, services and businesses directly.
No expected negative short term disruption to Crowd2Fund
Investors should be reassured that we expect no disruption to the services provided by Crowd2Fund. Investors should also be reassured that we will continue to work closely with our French partner company Mangopay, who manages client funds which are held at Barclays in Canary Wharf. The only minor impact to Crowd2Fund in the medium term may be that it will be more challenging to acquire a license to establish ourselves in EU markets to allow us to fund EU investment opportunities.
The risk of this is low as we expect establishing financial licensing to pass with relative urgency as part of any agreement between the EU and UK, based on the market opportunity for EU banks in the UK market. If passporting our license is not possible anytime soon, application will be required to be made directly to local regulators – or alternatively partnering with a local EU entity.
The Fintech sector is critical in stabilising the UK ship over the coming, days, months and years. If you’re an investor, you can support the British economy by investing directly into growing British Businesses.
Past performance and forecasts are not reliable indicators of future results. Your capital invested is not covered for compensation in the event of a loss by the FSCS. Tax treatment will depend on the individual circumstances and may be subject to change. Please see our Risk section before making an investment decision.