While new research suggests 67% of RegTech companies Down Under are run by men, it is still slightly better than the FinTech sector where 73% are male-led.
Men run the Australian RegTech industry with 67% of the companies only having male leaders, according to new research from the Australian RegTech Association.
It revealed that 30% have one or two female founders and that 3% had between three and four women leading the startups.
However, that might be a smaller split than that of the Australian FinTech industry in general. According to research from EY, 73% of the FinTech sector in Oz have an all-male founding team.
That being said, the Australian RegTech Association does note itself that its findings should be taken with a pinch of salt.
The research is based on an online survey answered by 33 founders and senior executives in the sector. Of those, 26 were based in Australia, one in New Zealand, three in the UK, one in Ireland and two in the US. Acknowledging the small sample size, the RegTech Association states that the research should be treated as indicative.
Of the people polled, 17% offered solutions in fraud and risk analytics, 21% in know your customer and onboarding solutions, 15% in reporting and dashboards, 12% in digital transformation, 9% in product, marketing and conduct assessment, 3% in privacy and consent solutions, and the remaining 3% worked in other fields.
Moreover, 64% had been in business for more than three years, 21% in between two and three years and 15% had been operating for a year or less.
Looking at funding, 70% bootstrapped their ventures, 27% came from angel investors, 15% attracted investments from venture capital firms and 12% said the same about corporate VCs.
Moreover, family, friends and colleagues contributed to 12% of the investment, 9% came from private equity, 3% from prize money and 3% from debt funding.
The research also revealed that it takes roughly 13% months for Australian RegTech startups to deploy their first product.
The research comes at a tricky time for the Australian finance industry. The Australian Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry exposed systemic misconduct in the sector.
It published its final findings at the beginning of 2019, shaking trust for the country’s financial industry at its core.
Research from the University of Melborne suggests that almost one in three Australians are dissatisfied with their financial situation, with the most commonly cited barrier to improving their financial situation was a lack of trust in financial institutions and advisors.
In any case, it was not a good look for the leaders of the country.
So, when the international Financial Action Task Force (FATF) opted to postpone its review of the country’s anti-money laundering (AML) regulations, many speculated that it was due out of a desire to spare the government more embarrassment.
The FATF denied it, saying the temporary delay was caused by the organisation undergoing a strategic review of its own effectiveness and that all ongoing reviews into any country, including Australia, had been postponed until that was completed.
At the time, some of the RegTech founders RegTech Analyst spoke with urged the FATF to complete its review as soon as possible.
Things did not improve in November when Westpac, one of the country’s biggest banks, was accused of having failed to follow AML and counter-terrorism financing regulations 23 million times between 2013 and 2018.
The chairman and the CEO announced that they would leave the bank amidst the scandal.
However, some RegTech founders believe that the sector could help financial institutions in the country regain the public’s trust.
One of them is Dilip Mohapatra, founder of RegTech company Cognitive View, who recently made the case for why when speaking with RegTech Analyst.
The RegTech Association’s research also comes as Australian lawmakers have set up a committee to see how the emerging RegTech community is doing and to see what can be done to make it thrive.
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