Innovative Ecosystem Draws FinTech Firms To Toronto

Toronto is a powerhouse for financial innovation in Canada: The city has the most sizable ecosystem for FinTech in the country, with 185 startups per one count. NorthOne, a FinTech firm that focuses on small business owners, is one of the companies that call the city home. NorthOne CEO Eytan Bensoussan told PYMNTS in an interview, “Our mission is to eliminate financial admin from the lives of small business owners. Our team has torn apart the small business banking playbook and created our own digital banking platform and operating model from the ground up.”

The company offers application programming interface (API)-powered banking that was created to automate back-office financial work. Bensoussan says it only takes a few minutes to onboard a bank account compared to other options, which can take days or weeks. Clients, in turn, receive debit cards and can move money through mobile check deposit, wire, BillPay and automated clearing house (ACH). They also gain access to automated teller machines (ATMs) across the U.S. that let them deposit cash and checks.

NorthOne chose Toronto as its base because of the city’s talent pool, and Bensoussan also pointed out that “the Canadian government also offers important financial support to deep tech companies like our own, making the salaries ultra competitive.” At the same time, Bensoussan said, the city has a large network of companies and professionals that “have been at the forefront of blitzscaling in tech.” (“Blitzscaling” has been defined as “a specific set of practices for igniting and managing dizzying growth.”) And neighbors such as Shopify and Wealthsimple “makes the city a very compelling place for any company,” Bensoussan said.

Bensoussan noted that “we’re seeing bigger, bolder and more ambitious companies emerge from the city on the regular. Funding rounds and exits have followed suit.” According to an announcement from public-private partnership Toronto Finance International (TFI) in March, FinTech investment in the Toronto region arrived at $221 million and 25 deals last year, up from $24 million and eight deals in 2013. Jennifer Reynolds, the organization’s president and CEO, pointed out in the announcement that the area has one of the biggest investment growth rates around the world with a 118 percent compound annual growth rate (CAGR) since 2010.

Reynolds said in the announcement, “While this is a much smaller absolute investment base than that of global hubs like London, New York and San Francisco, we have the opportunity to leverage North America’s second-largest financial centre, combined with its third-largest tech cluster, and use this momentum to become a global FinTech leader.”