European Fintech unicorns are creating a new generation of founders

• The largest fintech start-ups in Europe produce a large proportion of new entrepreneurs in the industry.
• Neo-bank N26, BNPL firm Klarna and Revolut have all seen ex-employees found new startups.
• It’s a sign that Europe’s tech ecosystem is maturing, according to VC firm Accel.

Europe’s fintech boom is solving one of the biggest problems in the region’s tech ecosystem, according to a new analysis: experienced founders.

Europe’s 61 fintech startups valued at $1 billion or higher have spawned 310 startups founded by their former employees, according to findings from Dealroom and venture capital firm Accel, which invested early in fintech firms such as GoCardless and Monzo.

Around 40% of these new start-ups are also in fintech, while the rest in other sectors, which implies a halo effect.

A lack of experienced operators – people who have worked in startups that go on to succeed – is often cited by industry observers as a reason why Europe lags behind America and China in producing large tech companies that eventually list. Those who do often run to Silicon Valley and bring their expertise (and wealth) to the US.

“Fintech has played a core role in the growth of the European tech ecosystem,” Accel partner Luca Bocchio told Insider. “Additionally, second-generation founders who have been part of large journeys at initial success stories are a key indicator of ecosystem maturity. The founders of the next wave of fintech startups have seen what it looks like to scale successful businesses, and they are are now building fresh innovative products with a natural edge.”

Deal platform Dealroom analyzed startups on behalf of Accel in Europe and Israel throughout September, October and November. The analysis included firms created by employees who had worked at a unicorn for five months or longer, within six years of leaving.

The largest producer of new startups, according to Accel, is N26. The German challenger bank has seen 24 former employees find new ventures, including commercial banking firm Penta – recently acquired by French fintech firm Qonto.

The Swedish buy-now, pay-later giant Klarna produced 23 startups, of which 65% are also in fintech.

Revolut, currently valued at $33 billion, has also seen a number of employees leave to start their own businesses. In part, that may be due to talent seeking new opportunities to strike it rich with an IPO at that valuation unlikely this year, or even next. Early employee Alan Chang created renewable energy firm Tesseract

Investment app Plum was founded by a former Wise employee. And Payflows, which remains in stealth mode, emerged from French fintech Luko.

“In such a technical, highly regulated industry, it takes time to create durable, category-defining businesses, so it’s worth reminding ourselves that the fintech category as a whole is still somewhat young,” added Accel’s Bocchio.

London, the continent’s leading fintech hub, has seen the most startups produced by unicorn tech companies in the period under review.

The city’s 27 unicorns have spawned 168 VC-backed startups founded by ex-employees, with 69% of them living in London.