The 2008 financial crisis created a perfect storm in financial services – an upheaval in regulation to improve competition and reduce the barriers to entry for new players, the explosion of smartphones popularity which meant consumers began managing their personal finances on the go for the first time, and a lack of trust in traditional financial services players which meant consumers were more willing to try out new players and challengers.
“Fintech” as a term wasn’t coined until 2013, but over the last decade, the sector has had a huge impact in the UK. Latest figures from Innovate Finance show it continues to grow, with investment reaching $9.1B for the first half of 2022, and data from Statista showing the sector is expected to employ around 105,500 people by 2030. Impressive metrics that are helping to cement the UK’s position further as a global innovation and tech leader.
As such, the sector never had any issue attracting top talent as people relished the opportunity to join a fast-paced, dynamic environment with flat structures, plenty of autonomy, and generous share packages. However, with a recession looming and fintechs under increasing pressure to cut costs and build profitable business models, many have had to make tough decisions in recent months – implementing hiring freezes, making employees redundant, and experiencing down rounds as they try to convince VCs to fuel their runway for the next 18-24 months. According to data from Layoffs.fyi, a platform tracking all tech start-up layoffs since the Covid-19 pandemic, over 4,480 employees have been let go in London alone, with almost a fifth of these coming from the fintech sector.
As the economic situation gets more challenging, we’re seeing a reversal of this decades-long trend with more and more people seeking jobs at traditional financial services players where they can get job security and stability – even if it means giving up the pace and dynamism of a fintech start-up. Earlier this year, for example, Goldman Sachs saw nearly a quarter of a million internship applications – a 16% increase compared to 2021 and a record level for the bank – for just 3,000 available places. Meanwhile, JP Morgan received almost 271,000 applications for just 4,604 places.
OakNorth Bank achieved cash flow breakeven just 11 months after its launch in September 2015. We’ve been profitable every year since, making c.£136m pre-tax profit in 2021 – a 73% increase from the previous year – and last year, we increased our lending of business loans by 60%. We haven’t carried out a primary funding round since February 2019 as we simply haven’t needed to raise the capital. While challenging times inevitably lie ahead for the economy and our customers, we remain optimistic and excited about the future.
Like the traditional financial services players, being profitable enables us to provide the job security and stability people are looking for, but as a seven-year-old fintech, we’re also able to offer the pace, dynamism, flat structures, autonomy, and share options of a high-growth start-up. We’ve continued to bring on talent, hiring over 190 people so far this year, and launching the second round of our rotational grad programme, welcoming grads from universities across the country. We keep investing in our team’s careers and development by funding new professional qualifications, supporting big plans outside of work, and making our workplace a fun and enjoyable place to be.
If you like what you’ve heard and are interested in a career at OakNorth, please get in touch with our talent team or check out our openings here.
