\nQu\u00e9bec is a strong contender to become a key North American finance hub, housing three of the largest banks in Canada and an emerging FinTech start-up community. According to an article published by the International Financial Center Montr\u00e9al<\/em>, \u201cQu\u00e9bec\u2019s financial services industry employs close to 160,000 professionals, with 100,000 working in Montr\u00e9al.\u201d In total these jobs can be broken down as follows:<\/p>\n
![\"\"](\"https:\/\/informationvp.com\/wp-content\/uploads\/2017\/08\/Finance-Jobs-in-Quebec--500x500.png\")
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Naturally, with a critical mass of finance industry professionals, Qu\u00e9bec is well placed to become a cluster for FinTech innovation.<\/p>\n
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This high growth FinTech market is looking to not only disrupt but partner with the traditional banking systems. According to the Competition Bureau\u2019s FinTech Workshop, Driving competition and Innovation in the Financial Services Sector<\/em>, collaboration between start-ups and established institutions can lead to excellent outcomes for both parties. Start-ups view this partnership as a way to access incumbent legacy infrastructure and platform technology and achieve scale quicker1<\/sup>.\u201d As we see this market grow in the coming years, we predict to see more disruption and partnerships within traditional banks and insurance companies that will help this sector grow into a vibrant ecosystem.<\/p>\n <\/p>\n The Talent <\/p>\n When we look at the talent in this region, we would be remiss to exclude Yoshua Bengio, a Qu\u00e9b\u00e9cois based computer scientist recognized for his work on artificial neutral networks and deep learning. This pioneer in the field who\u2019s spawned Element AI is assisting this high-growth area of FinTech and helping lead researchers in this region further develop the ecosystem.<\/p>\n <\/p>\n This pool of talent, coupled with the resources available in the province, creates ideal conditions for FinTech start-ups to move from proof of concept, to production, to a thriving business.<\/p>\n <\/p>\n The Challenges<\/strong> <\/p>\n The FinTech ecosystem in Qu\u00e9bec is definitely on the rise. Our survey of the landscape shows various companies present in the region (see: logo chart below). While there are many start-ups that are growing from the region, they have yet to make a large impact on the broader community. This challenge, which is not exclusive to Qu\u00e9bec, is slowly being overcome with the help of FinTech specific incubators, accelerators and other resources put in place to help stimulate innovation in this field, along with an increasing willingness from Financial Services firms to partner with FinTechs to help with the evolution of the ecosystem.<\/p>\n Long decision-making processes are not exclusive to only Qu\u00e9bec or FinTech for that matter. Financial Institutions can be slow to adopt new technologies into their legacy systems. Many companies are revolutionizing this process, and we predict that decision-making processes will continue to grow shorter over time.<\/p>\n <\/p>\n Momentum in Quebec It is evident that FinTech is on the upswing in Quebec. Between 2013-2015 Quebec\u2019s FinTech investment totalled C$152M which contributed to 50{0573984a2b8f609c30111d9663e55dcffe5bf46757f544e848868cbca776ed36} growth1<\/sup> between the years 2014 and 2015. The proof of this growth is shown through Montreal-based companies like Lightspeed. In 2015 LightSpeed2<\/sup> raised C$80 million from the Caisse de d\u00e9p\u00f4t et placement du Qu\u00e9bec, Investissement Qu\u00e9bec, iNovia and Accel Partners. Jump to 2017 and the pace has quickened with Montreal-based Element AI\u2019s3<\/sup> C$137.5M Series A raise led by\u00a0Data Collective (DCVC). It is certainly clear that Quebec has multiple talented FinTech companies and investments pouring into this ecosystem do not show signs of slowing down anytime soon.<\/p>\n <\/p>\n There are also instances of Quebec financial institutions backing these FinTech innovations. More recently National Bank4<\/sup> has invested C$6M into Toronto-based Nest Wealth5<\/sup> which licenses its investment technology to help its advisors manage clients\u2019 money using digital practices.\u00a0Another example would be Desjardins.6<\/sup> Since 2013, Desjardins has collaborated with iMetrik, a Montr\u00e9al-based company, to implement the Ajusto program, which estimates a driving \u201cscore\u201d that converts into a discount on your next insurance subscription. This funding allows the Qu\u00e9bec financial institutions to familiarize themselves with FinTech and better utilize it in the future.<\/p>\n <\/p>\n Now that Quebec has momentum, the key is sustaining and improving on this success. One key to advancing would be developing a consistent university curriculum in Qu\u00e9bec universities7<\/sup> to advocate the multiple professional FinTech career paths. Another suggestion includes creating a FinTech hub8<\/sup> to develop Qu\u00e9bec\u2019s FinTech ecosystem which also sufficiently backs developing or existing FinTech firms. Everything considered, Quebec is in a promising position to grow and situate itself as a prominent Fintech hub in the future.<\/p>\n <\/p>\n At Information Venture Partners, we believe that most regions in Canada are growing FinTech ecosystems with their own unique stages of growth, challenges, and talent. We will however, be keeping our eye on Qu\u00e9bec tracking this region carefully to see how it grows and matures into an innovation hub producing exceptional products and talent.<\/p>\n <\/p>\n <\/p>\n Sources:<\/strong><\/p>\n [1] http:\/\/www.finance-montreal.com\/sites\/default\/files\/publications\/factsheet_-_montreal_global_financial_centre.pdf<\/p>\n [2] http:\/\/www.competitionbureau.gc.ca\/eic\/site\/cb-bc.nsf\/vwapj\/FinTech-Report-Workshop-Eng.pdf\/$file\/FinTech-Report-Workshop-Eng.pdf<\/a><\/p>\n [3] http:\/\/www.ey.com\/Publication\/vwLUAssets\/EY-Accelerating-development-in-Montreals-FinTech-ecosystem\/$FILE\/EY-Accelerating-development-in-Montreals-FinTech-ecosystem.pdf<\/a><\/p>\n [4] Ibid<\/p>\n [5] Ibid<\/p>\n
\n<\/strong>Montr\u00e9al is home to four major universities: McGill, Universit\u00e9 de Montr\u00e9al, Universit\u00e9 du Qu\u00e9bec a Montr\u00e9al and Concordia. These four schools are all producing exceptional talent and have in-house accelerators and incubators to help foster the innovation that the schools are producing. Montr\u00e9al is also number 1 in North America and 7th<\/sup> worldwide as a destination of choice for international students with 24{0573984a2b8f609c30111d9663e55dcffe5bf46757f544e848868cbca776ed36} of all graduates earning degrees in STEM placing Canada ahead of the UK and the USA1<\/sup>. \u00a0This stream of talent also has access to various accelerators, incubators and a variety of funding sources including the following3<\/sup><\/p>\n![\"\"](\"https:\/\/informationvp.com\/wp-content\/uploads\/2017\/08\/Quebec-Accelerators-.png\")
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\nWorking in FinTech can have its own unique sets of challenges especially when disrupting a traditional business model. Among the challenges are: an emerging set of FinTech companies but not a critical mass and the challenge of a long decision-making process by customers.<\/p>\n![\"\"](\"https:\/\/informationvp.com\/wp-content\/uploads\/2017\/08\/Picture1.png\")
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