Connecticut has emerged as the latest hub for the fintech industry, and there’s good reason why! Leading industry names, such as SS&C Technologies and COCC, first put Connecticut on the fintech map years ago.More recently, financial technology firms like Continuity Control and SmartPay Solutions have successfully called Connecticut their home. The state continues to be a favorite destination for innovators and disruptors of the financial industry. Here are some reasons why:
Investors That Love Fintech Are Here:
Investors are key players in the startup ecosystem, and Connecticut has plenty.
In 2015, CT-based startups raised more than $446 million in investments. It’s no wonder that Connecticut ranks seventh in venture capital deals in the United States.
In the recent years, the fintech industry has globally become a hot favorite with investors. CT-based VC firms have also been at the forefront of this funding wave. Oak HC/FT, for example, invests exclusively in fintech and healthcare startups. This VC firm typically looks out for data-driven solutions and services that enhance efficiency and transparency, while mitigating risk and fraud. Their existing fintech portfolio includes companies like Digital Currency Group, Fastpay, Feedzai, Insureon and Poynt.
Based out of Rocky Hill, Connecticut Innovations (CI) is also a prominent investor in seed and early-stage fintech ventures. In fact, a recent CB Insights report ranked Connecticut Innovations as the state’s top investor in tech companies. CI has put its money behind several fintech companies, including Continuity Control, Neuvis and Cashpath Financial.
Activant Capital Group is another VC firm on the lookout for tech entrepreneurs who are driving innovation in financial services. Celect and RetailNext have already benefited from investments from this VC firm.
Resources and Organizations for Fintech Growth:
Several organizations, tech incubators and networks are dedicated to helping fintech and other tech startups launch and grow in Connecticut.
Connecticut Business Connection, Connecticut Business and Industry Association and CTNext are a few of the many CT-based organizations that offer tools, guidance and networking opportunities to help startups accelerate the success of their ventures.
The Connecticut Innovations Blog has tons of relevant updates and articles, making it a handy resource for business owners and entrepreneurs.
In addition, there are plenty of guides to help CT-based businesses and startups to launch and become thriving businesses. Entrepreneurs will find guides with all the useful information they need—right from how to start a business in Connecticut and how to form a corporation in Connecticut to how to incorporate in Connecticut.
Glendowlyn Thames, director of Rocky Hill-based Small Business Innovation and CTNext, says, “We are seeing the private market increase the level of investment in the startup and entrepreneurial community, and we expect that this will continue in the future.”
Solid State Support:
The state government has been working hard to help establish Connecticut as the Silicon Valley of the Northeast. Since 2011, the state has helped more than 1,600 companies through a range of incentives, tax reliefs and programs.
Connecticut provides tax credits to insurers that invest in CT-based businesses through approved fund managers. In 2015, the state increased the amount of tax credits available for investments in Connecticut’s businesses, from $200 million to $350 million. This move has greatly encouraged venture investment in the state.
In addition, Connecticut’s Enterprise Zone Program allows qualifying corporations that are recently established within an enterprise zone to receive a five-year, 80 percent real and personal property tax abatement, and a 10-year, 25 to 50 percent corporate business tax credit. Moreover, the Small Business Express Program provides incentive-driven loans and grants to encourage small ventures.
The state government also offers a concierge service to help businesses set up in Connecticut. From the registration process to sourcing financial and technical assistance, the state offers complete support to startups.
Powerhouse of Innovation and Productivity:
This is no surprise, given the various hubs and networks dedicated to supporting a vibrant community of innovators. For example, the Stamford Innovation Center, the Fairfield Accelerator and Innovation Destination: Hartford offer numerous services for entrepreneurs and disruptors—from resources and tools to help turn ideas into reality, to operational support and networking opportunities.
The Connecticut Business Incubator Network has seven participating incubator programs located across Connecticut. These facilities house more than 60 small businesses. With so much push for innovation in the state, it’s not surprising that the number of patents issued to Connecticut residents is 33 percent higher than the national average.
The state also ranks high on the productivity barometer! Connecticut ranks fourth among U.S. states when it comes to the highest productivity per person. In fact, it also has a 31 percent higher output per worker than the national average.
Not just productivity but also talent seems to be in abundance here!
This access to an industrious and highly educated workforce makes the state a favorite with tech companies.
In the words of Michael Klein, co-president of insurer Travelers, “The workforce that’s here today and the workforce that we’re training for the future are the reasons that you’re going to have the right talent, the right expertise and the right opportunities to do your business in Connecticut.”
Great Quality of Life:
The state is conveniently located just an hour away from both New York City and Boston. However, living in Connecticut can cost 8 to 43 percent less than living in either of these two cosmopolitan hubs.
Residents of Connecticut also enjoy effortless connectivity via major highways, trains, ports and airports, as well as easy access to excellent schools, a scenic landscape and a rich cultural life.
Connecticut also ranks fourth among U.S. states for the best quality of life in the country. And, as Governor Dannel P. Malloy adds, “Connecticut also ranks among the top states for doctors per capita, with world-renowned hospitals and a robust healthcare system.”
An environment that is conducive for innovation, easy access to venture funding and state support, plus a highly qualified workforce are some of the factors drawing fintech entrepreneurs to Connecticut.
The fintech industry is booming in Connecticut, and your startup can be part of the disruption, too!
Are you ready to leverage the many advantages that Connecticut offers fintech startups? Are you ready to move to the newest hub for financial technology?