Riding the Wave of Disruptive Tech

Translating Challenge into Opportunity

Digital technology has never been more integral to professional services. FinTech, PropTech, LawTech: AI and cyber solutions are transforming the face of modern business, nowhere more than in the West Midlands, which is home to the UK’s largest regional Business, Professional & Financial Services (BPFS) cluster and one of only three established regional FinTech hubs.

This high-growth sector comprises over 48,000 companies and employs a workforce of more than 340,000 people. It has increased in size by 30% over the last five years and shows no signs of deceleration, with projected revenue of £50bn by 2030, and the regional FinTech sector accounting for £470m Gross Value Added (GVA). Innovation is a driver of growth, but research and development is expensive and risky; keeping ahead of the technology curve can come at a price. With the pace of change accelerating, and fine margins between success and failure, what can companies do to harness the wave of disruptive tech?

‘Technology is a big unknown and it’s affecting established businesses as well as new entrants.’

Hilary Smyth-Allen, SuperTech Chief Executive, says that the region’s heritage in banking and finance provided a readymade market for FinTech products. ‘Several British banking titans – Lloyds Bank, Midlands Bank (now HSBC) – have their origins in the West Midlands. And, of course, the real estate sector is an intrinsic part of our DNA, too, so disruptive technologies within these contexts has really driven a need for innovation.’

Combine this heritage with a younger-than-average population, prolific universities and a culture which has always celebrated change, and it’s easy to see why the West Midlands is a dynamic centre for disruptive tech. That’s not to say change is always simple.

‘Financial and professional services are really good at growing and looking after themselves, but technology is a big unknown and it’s affecting established businesses as well as new entrants. Fifteen years ago,’ Smyth-Allen asks, ‘how many financial services firms had their own research and development departments? How many law firms thought artificial intelligence (AI) would really have to become a part of their fabric? The pace of change, real disruptive change, has been startling, and it’s only likely to accelerate over the next decade.’

‘Our SuperTech Seeds programme has helped launch 40 businesses, and we’ve several more in the pipeline. This is a tangible way we’re helping shape the West Midlands technology sector.’

Hilary Smyth-Allen explains how companies can embrace change and find opportunity among technological turmoil.

‘SuperTech operates around the verticals of professional and financial services technologies – FinTech, PropTech, LawTech – which really means the disruptive industries within the professional and financial services sector. We aim to drive cluster growth within the West Midlands. When you’re based in a region, so many people need to know each other, want to know each other, but perhaps struggle to find each other, so we create a plethora of activities and initiatives to enable those encounters and for collaborations to develop. We’re also interested in addressing gaps and challenges to help businesses to grow, through creating better conditions to do business.

‘At SuperTech, we bridge the gap between the grass-roots business base starting and scaling in the region in sectors that are really important to the UK economy, with national initiatives and established corporates. Oftentimes it’s about creating the safe space to meet and exchange ideas, explore market propositions and align mutual interests. It’s our role to facilitate this in order to drive growth at all levels: firm, regional and beyond.’

Smyth-Allen is confident that partnership and collaboration represent the future of disruptive tech in the West Midlands.

‘We’ve reached this stage of co-creation between established businesses and new entrants, and we do a lot of activities brokering that gap. Sometimes incumbents don’t know what they need, but they also want to be able to access what is new and nimble and cutting edge, which is always easier to do outside the core business. I see a real big trend towards more collaboration, not just between SMEs and new entrants, but also among larger corporations. This is the real opportunity for the whole of the sector.’

SuperTech exists to help businesses at all stage of development, including early-stage and founders. Smyth-Allen says,’The programme I’m particularly proud of is our SuperTech Seeds initiative, which I think is pretty unique within our industry. Establishing a new tech business can be hard. When you start digging into the statistics around FinTech for example, the average business founder is 48 years old, white, male and middle class. This isn’t representative of our region and it’s so unhealthy for the wider economy, as well as being socially unpalatable and morally problematic.

‘SuperTech Seeds exists to support founders, transforming Powerpoints into businesses by providing the technology and support they need to get going. We’ve launched 40 businesses through this programme, and have several more in the pipeline. This is a tangible way in which SuperTech is changing the face of business in the West Midlands, and I’m really excited about its future.’

But what about the bigger picture? For Hilary Smyth-Allen, cooperation is about more than just increasing a single company’s turnover or improving the bottom line. ‘Our work is about making a positive contribution to Team UK. Professional financial services are so important to the whole country, and the West Midlands has a significant stake in that, so we need to play our part and leverage our strengths. How can we make a big pie bigger, so that in turn the size of the slice grows too? So that’s where the real opportunity exists. Where we can do more at an industry level, the more everyone wins.’

It’s clear that the pace of technological change isn’t likely to slow down any time soon, particularly in the West Midlands, and collaboration is critical to success. Fortunately, with cluster management organisations like SuperTech on hand, financial and professional service companies can look forward to an exciting future.