Global Startup Ecosystem Report: Frankfurt’s Startup Ecosystem conquers Top 10

Frankfurt, Hesse, April 17, 2018 – Released at the Global Entrepreneurship Congress in Istanbul, the Global Startup Ecosystem Report 2018 features insights from over 10,000 founders across 45 cities, and shows what it takes to build a dynamic startup ecosystem. For the second time since 2017, Frankfurt is one of the top 45 cities for which detailed data was collected. The Frankfurt startup ecosystem has received special recognition worldwide for the creation of a FinTech cluster and is presented several times as a future hub of the new tech era.

“The Frankfurt region combines a solid (digital) infrastructure, the right kind of talent, globally acknowledged research & teaching and a decade-long experience of established companies. The Masterplan for the FinTech and Startup region Frankfurt Rhein-Main, developed by TechQuartier, defines specific measures to foster the creation of tomorrows ideas, businesses and innovation. Together with partners from the worlds of industry, science and politics, the State Government of Hessen fully supports the implementation of the Masterplan.“ Tarek Al-Wazir Hessian Minister of Economics, Energy, Transport and Regional Development.

Global Startup Ecosystem Report. Quelle: TechQuartier Frankfurt

Quelle: TechQuartier Frankfurt

According to the authors of the report, one of the keys to Frankfurt’s success is its clear focus on FinTech. “Frankfurt has the highest (together with another ecosystem) concentration of start-ups in a particular subsector in the almost 100 ecosystems worldwide,” the report states. In addition, more than 50% of local VC investments were invested in Fintech start-ups between 2012 and 2017.

“Frankfurt has a relatively high number of startups in the B2B sector. For the FinTech sector, this results in the proximity to regulators and banks for partnerships. The Frankfurt ecosystem offers the best conditions for starting and growing a FinTech business with access to experienced workforce and investors. We see FinTechs as partners to innovate our business and not as competitors” says Swen Moellmann, Head of Digital Strategy & Innovation at ING-DiBa.

This large concentration of financial expertise, banks and FinTech start-ups and the close cooperation between the start-ups leads to 7th place worldwide in the “sense of community” indicator.

“In the last two years, the start-up scene in Frankfurt and the Rhine-Main region has developed rapidly. A key factor here is the excellent interaction of the players in the Frankfurt financial centre. We will continue to do so and thus make even better use of the region’s potential,” says Thomas Groß, Deputy Chairman of the Board of Managing Directors of Helaba.

While the Global Startup Ecosystem Report gives an overview of how Frankfurt compares with other ecosystems worldwide, a more detailed study is also in progress. This will focus in particular on high-growth start-ups (or scale-ups) and compare Frankfurt with other leading ecosystems in Asia and North America. The results of this study will be presented at a press conference at TechQuartier on June 12 2018.

Source: TechQuartier

Find the full Global Startup Ecosystem Report here.

Plug and Play and TechQuartier announce first five corporate partners to join Fintech Europe Innovation Platform in Frankfurt

Plug and Play, the largest global innovation platform, and TechQuartier, the one-stop startup hub in the heart of Frankfurt, Germany, announce Aareal Bank, BNP Paribas, Deutsche Bank, DZ Bank and NETS Group as the first five corporate partners to join their fintech program based out of Frankfurt. The partnership, known as Fintech Europe, will act as a home away from home for some of the most disruptive and innovative startups in the banking industry as they pilot their solutions with leading financial institutions.

The goal of Fintech Europe is to have 10-15 banks and financial service providers as partners in Frankfurt. These first five founding partners will dictate the focus of the program based on their current use cases, with Plug and Play championing a selection of highly rated startups sourced via their global network. Plug and Play will work hand in hand with the partners’ various business units to expedite the engagement process and encourage fruitful collaboration.

“Frankfurt is a major financial capital and on track to also become a global fintech hub. We are very proud to be launching our first fintech open innovation platform for Europe, and we invite our partners from across the continent to join us as we build a fintech platform that is relevant not just to Europe, but the world,” says Saeed Amidi, CEO and Founder of Plug and Play.

The program is set to kick off on May 29th, 2018 and the first batch of startups will join in June. TechQuartier will provide complimentary desk space along with mentorship from their premier network of executives, investors and entrepreneurs.

If you are a financial institution looking to work with an international scope of technologies, or a startup enabling the advancement of the financial sector, get in touch today.

Please contact Amir Karimpour or Fernando Zornig to learn more.

About Plug and Play

Plug and Play is a global innovation platform. Headquartered in Silicon Valley, we have built accelerator programs, corporate innovation services, and an in-house VC to make technological advancement progress faster than ever before. Since inception in 2006, our programs have expanded worldwide to include a presence in over 20 locations globally giving startups the necessary resources to succeed in Silicon Valley and beyond. With over 6,000 startups and 220 official corporate partners, we have created the ultimate startup ecosystem in many industries. We provide active investments with 200 leading Silicon Valley VCs, and host more than 700 networking events per year. Companies in our community have raised over $7 billion in funding, with successful portfolio exits including Danger, Dropbox, Lending Club, PayPal, SoundHound, and Zoosk. For more information, visit www.pnptc.com.

About TechQuartier

TechQuartier (TQ) is the central platform for the start-up community in the Frankfurt Metropolitan Region. Since December 2016, TQ has been offering over 3,200 square meters of flexible working space for start-ups, scale-ups as well as for innovation and digital teams of established companies. With numerous events, tailor-made offers for talents, start-ups and established companies, TQ offers an ideal environment for the development of new technologies, services and business models. TechQuartier enriches the vibrant start-up ecosystem in Frankfurt Rhine Main with its unique community of more than 80 startups and 30 corporate partners and academic institutions, including Aareal Bank, Allen & Overy, Atos/equenswordline, Commerzbank, Deutsche Bank, Deutsche Börse, DZ BANK Group, EY, Goethe-University, Helaba, ING-DiBa, KPMG, PwC, Sparda-Bank, Hesse, TU Darmstadt and WIBank. The TechQuartier has also been designated by the Federal Ministry for Economic Affairs and Energy as one of Germany’s “FinTech-Hub”. For more information, please visit www.techquartier.com.

CEINEX Newsletter – April 2018

CEINEX (China Europe International Exchange), the first dedicated platform for China- and RMB-related investment products outside Mainland China, publishes a monthly newsletter featuring CEINEX news and news from their three shareholders – Shanghai Stock Exchange (SSE), Deutsche Börse Group (DBAG), and China Financial Futures Exchange (CFFEX).

Download the Newsletter as a PDF here!

Below are the highlights in CEINEX newsletter of April:

  • Chinese Infrastructure Construction Developer Chengdu Xingcheng Investment Group Successfully Lists First Eurobonds for EUR 500 Million on CEINEX
  • The Story Between Ceinex And The First China-Germany High Level Financial Dialogue
  • Highlights of Premier’s Government Work Report
  • China to Form New Regulatory Commissions
  • China Focus: China Launches Crude Oil Futures Trading
  • U.S. Experts Say MSCI’s New China Indices Show Greater Weight of Chinese Market

To subscribe to receive the newsletter by e-mail, please write to ceinex.forum@ceinex.com.

CFS Index_April 2018_Centre for Financial Studies

CFS Index unable to maintain record level from the previous quarter

Growth in revenues and earnings falls, though levels remain high / Financial institutions hiring again after sustained period of job cuts / Investment volume stable

The CFS Index, which measures the business climate of the German financial sector on a quarterly basis, falls by 3.4 points in the first quarter of 2018, though it remains at a healthy level of 116.7 points. The decline can be attributed to weaker performance in revenues/business volume and to lower profitability, among the service providers more than the financial institutions. This development therefore confirms the service providers’ expectation from the previous quarter that the record growth from the fourth quarter of 2017 could not be maintained. On the other hand, employee numbers in the financial industry are on an upward trend. The financial institutions are hiring again for the first time after a prolonged period of job cuts. The investment volume of the financial industry remains stable at a high level.

„The overall index is closely mirroring the downward macroeconomic trend in Germany. The employee numbers reveal a contrasting positive trend. For the first time in a considerable period the optimists are in the majority at the banks. This has already been the case among the service providers for some time. Taken together, the survey participants indicate positive long-term expectations for the financial industry“, Professor Jan Pieter Krahnen, Director of the Center for Financial Studies, interprets the results.

The future international importance of the Financial Centre Germany continues to be rated very positively, though no longer at its peak level.

With a decline of 4.1 points to 131.8 points, the business location sub-index, which measures the future international importance of the Financial Centre Germany, is now just under the extremely high level of previous quarters.

„The importance of the financial centre will grow, which is understood by market players, albeit to a lesser extent. The competition has intensified after the Brexit referendum. Defending our leading position requires greater efforts“, Hubertus Väth, Managing Director of Frankfurt Main Finance e.V., interprets the survey results.

After an extremely strong previous quarter, revenues and earnings take a downturn, yet remain at a high level

Following a particularly strong fourth quarter of 2017, the surveyed financial institutions and service providers are unable to maintain their huge growth in revenues/business volume. The corresponding sub-index for the financial institutions falls by 4.1 points to 118.6 points; the service providers show a larger decline of 16.2 points to 121.3 points. As for the current quarter, the financial institutions are expecting another slight decrease, while the service providers are anticipating a small rise in revenue growth.

The earnings growth of both groups is declining, yet it also remains at a high level. The corresponding sub-index for the financial institutions falls by 2.8 points to 111.1 points, though an increase is forecast for the current quarter. The service providers record a stronger decline of 11.4 points to 122.2 points, and they are expecting the downward trend to continue in the current quarter.

Investment volume remains almost unchanged at a high level

The growth in investment volume in product and process innovations among the financial institutions shows a slight rise of 1.0 points to 114.8 points, and a further increase is expected this quarter. The corresponding sub-index for the service providers takes a slight downturn of 1.3 points to 112.6 points. However, the service providers are anticipating a slight increase in the current quarter.

Employee numbers on the rise in the financial sector / Financial institutions hiring again after a sustained period of job cuts

After the prolonged period of job cuts in recent quarters, the financial institutes report that employee numbers are now rising again for the first time. The employee numbers sub-index climbs by 4.0 points to 102.6 points. However, the expectation is that this level will not quite be maintained in the current quarter. The trend is also positive among the service providers, where more new employees are being hired. The sub-index rises by 6.2 points to 123.0 points. Slightly weaker growth in employee numbers is forecast for this quarter.

CFS survey: German financial industry expects trade dispute between the US and China to escalate further

The US has decided to impose punitive tariffs on steel and aluminium imports, principally from China. For its part, China is showing little willingness to give in and make concessions. According to a recent survey by the Center for Financial Studies, the majority of the German financial industry expects the trade dispute between the two countries to escalate further. 75% of the respondents agree on this point.

The EU and other countries are not directly affected by the trade dispute for the time being. However, US punitive tariffs on steel and aluminium imports from China could lead to Chinese surpluses in these products, which would then be pushed onto other markets, including the EU. The financial sector is divided on the question of whether the EU will also have to increase its tariffs on imports from China sooner or later. While 46% consider this development quite probable, 45% consider it unlikely and 5% consider it very unlikely.
Interpreting the results, Professor Volker Brühl, Managing Director of the Center for Financial Studies, comments: “The survey highlights the high level of uncertainty among market participants about the future development of the trade dispute and its possible consequences for Europe. I therefore assume that the volatility on the European stock markets will increase.”

The EU is also preparing for difficult negotiations with the US, where the current tariff structure of the EU as a whole is expected to be on the agenda. The German financial industry is largely in agreement (83%) that the EU must make concessions in future negotiations with the US (e.g. by reducing import tariffs on other US products) in order to rule out punitive US tariffs on steel and aluminium imports from the EU.

“I believe that the trade policy of the Trump administration has the potential to significantly change the architecture of the European customs union, since Europe will have to make considerable concessions to the US,” Brühl continued. “Ultimately, it is inevitable that transatlantic trade relations between the US and the EU will have to be redesigned.”

In light of current developments, 55% of respondents believe that negotiations on a Transatlantic Trade and Investment Partnership (TTIP) should be resumed in order to form a new basis for trade between the US and the EU. 39%, on the other hand, are against a resumption of TTIP negotiations.

Dr. Lutz Raettig, President of Frankfurt Main Finance e.V., emphasises: “Trade wars are poison for the economy. The uncertainties and heightened risks lead to reluctance.”

2018 Europe – US Symposium: How will Brexit change the map of global finance?

Dr Andreas Dombret
Member of the Executive Board
of the Deutsche Bundesbank

Speech at the 2018 Europe – US Symposium
of the Harvard Law School Program on
International Financial Systems in Armonk, New York Wednesday, 11 April 2018

Read more

Hubertus Väth: Why I’m sticking with the “10,000”

As an economist, you calculate a lot of numbers in your life. As a communicator, you learn to value them as carriers of messages. But none of “my” earlier numbers have stirred minds and the media as much as my forecast for the “morning after”. 10,000 – calculated weeks previously for the worst-case scenario, published for all the world to see the day after the Brexit referendum, this number has been roaming around the media landscape ever since.

It could mean 10,000 jobs ending up in Frankfurt, if… (followed by a whole host of conditions). London’s City could lose as many as 20,000 to 25,000 jobs. Not a lot really, considering that the London financial centre employs 700,000 people, but a big deal for Frankfurt.

The number was a message: a great deal for Frankfurt, not so much for London. It was a broad definition, including as it did all support industries. And the number also had conditions attached: Brexit is coming, passporting is going, the EBA is coming and euro clearing won’t stay in London, the relocation will last for more than five years and – it’s gross, i.e. doesn’t make allowance for any job losses in Frankfurt.

So you can see: all of the key areas of discussion to date had already been highlighted on the “morning after”. But the spotlight was on it alone, the One. The Number. Such complex material, so nicely rounded.

Since then, it has appeared in around 90 countries. You hear it, see it, read it. Journalists from all over the world made the pilgrimage to this beautiful city on the river Main, full of self-doubt, but ready to be convinced. By now I’ve talked to more than 800 of them.

Frankfurt as the big Brexit winner? The doubters were not hard to find. There are no schools, no offices, no apartments. There was even carping about the food and beer, not to mention the quality of the locally available coffee, and a damning indictment of the cultural landscape. The image was frightful, according to harmonious souls in Munich, Dusseldorf, Cologne, Hamburg and Berlin, and the City and its competitors for London jobs in Paris, Dublin and elsewhere cited them with relish.

It will be 2,000 to 3,000 jobs at most, it was said, quietly and in confidence. A forecast that has since been increased several times in the same place. The Frankfurt School of Finance & Management saw 20,000 bankers on their way across the Channel. By contrast, supposedly sober-minded people held any forecast at all to be frivolous (the who’s who of the consultant scene however did exactly that in London: forecast. But in Frankfurt we were serious, oh yes!) But around 15 months later, the same source felt able to report about 5,000 jobs net. In other words, there were now forecasts of an influx from London and job losses in Frankfurt at the same time. Despite every effort to do so, we cannot figure out the two components of this number to this day.

Helaba leaped to our defence early. The always well-received, annual, and in contrast to us as a lobbying association (more disparaging would hardly be possible), always considered respectable study on the situation in the financial centre came up with 7,000 London jobs in 2016, before going on to see a lower limit of 8,000 a year later in 2017.

No sooner were the first names of the financial institutions coming out in favour of the location known, and scarcely had it been made public by the board that in the worst-case scenario up to 4,000 jobs are under scrutiny at Deutsche Bank in London, than the calls came for us to increase the number. The decision to relocate the EBA in favour of Paris had barely been reached, and many people already wrongly believed Frankfurt to be playing a losing game.

No, we stuck with and are sticking with the 10,000. Are we not capable of learning? Yes, we are, but if you think ahead, you don’t have to up the ante: to this day, we still don’t know exactly what Brexit will look like. Although many things are a lot clearer than a few months ago: Brexit will come. That can be considered very certain. A transitional period of 21 months has been agreed. The five-year period in which the 10,000 jobs we forecast would relocate to Frankfurt has proven to be far-sighted, as has the thesis that euro clearing would become an issue and will be decisive in terms of the outcome.

So yes, we are undeterred, because 21 months after the referendum, our scenario is still intact. The transitional period cannot be prolonged. The exit from Brexit that some believe they can see will turn out to be a mirage. Only the EBA didn’t come, giving us the perfect excuse if the number doesn’t quite reach 10,000.

And one more thing: you can take advantage of opportunities, or you can fail to do so. 10,000 is absolutely possible for the Financial Centre Frankfurt. If we don’t reach it, the question must be: why did they not come? We think it’s better to now ask the question: what else do we have to do to reach it? Plenty! The 10,000 is still feasible. Because many people have very quietly done a great deal of good. If you consider the use of the (modest) funds with which everything so far has been achieved, the result is sensational. Simply Frankfurt.

This guest contribution was first published in the daily newsletter at Finanz-Szene.de.