Shaping Transatlantic Business in 2024: Fintech Projections for London and North America

In 2023, global foreign direct investment faced challenges due to geopolitical complexities, higher interest rates, and a cautious approach from venture capitalists, resulting in a 29% decrease in FDI projects globally. However, Europe’s VC share surged to 19%, and London witnessed a 14% quarter-on-quarter increase in startup investments, projected to reach $18 billion by the year-end. Looking ahead to 2024, here are some insights into the potential trends shaping transatlantic trade between North America and London:

Fintech: A Revival of Fortunes

• Despite challenges, London’s fintech companies emphasized quality over quantity in their expansion efforts in 2023. Notably, fintech scale-ups from London secured contracts with major U.S. corporations and established a presence in North America.
• Companies like Bud and Hoptroff found success in both London and NYC, reflecting the strength of London’s startup ecosystem.
• Predicting a resurgence in the U.S. fintech sector in 2024, with a return to normal investment levels in London. Positive economic indicators in the U.S. may prompt VCs to deploy funds, enabling companies to expand.
• Anticipating a shift in the cryptocurrency landscape towards more regulated use, exploring central bank digital currencies and broader applications of Blockchain technology.

Continuing the Momentum to Net Zero

• The U.S. climate tech sector, boosted by the CHIPS Act 2022 and the Inflation Reduction Act 2023, is seeking new market opportunities. London remains a preferred destination for U.S. companies expanding internationally.
• London’s strengths in cleantech, green finance, proptech, smart mobility, circular economy, and high-end services have attracted successful ventures like Cloverly and the Antenna Group.
• Home-grown London climate tech innovators, including Rensair, Tallarna, and Naked Energy, are expanding into North America.
• Expecting the trend of climate tech expansion to accelerate in 2024, driven by global Net Zero goals and new legislation promoting innovative ideas.

Artificial Intelligence: Normalization and Further Innovation

• Generative AI, highlighted by ChatGPT and mainstream AI-generated portraits in 2023, will continue to be a major sector in London.
• The Knowledge Quarter in Kings Cross serves as Europe’s undisputed AI hub, attracting organizations like Google’s DeepMind. OpenAI opened its first international office in London in 2023.
• Foreseeing the normalization and integration of new AI tools into tech stacks, facilitating areas such as documentation and compliance in legaltech and fintech.
• Marketing teams leveraging AI-generated models for innovative creative experiences, exemplified by London’s Charisma.ai bringing characters to life with AI-driven voices, emotion, and storytelling.
• Acknowledging concerns about job alterations but emphasizing the potential for technology disruption to spark innovation.

In conclusion, transatlantic partnerships in 2024 hold promise, and companies and investors should feel optimistic about the opportunities presented by trends in fintech, climate tech, and artificial intelligence across North America and London markets.