By : Nicolas Rose, Alexis du Peloux, Majdoline Wahbi


The explosion of the regulatory environment in the financial industry

As a result of the financial crisis we experienced in 2008, the regulatory framework has become considerably denser for financial institutions in Europe. Various banking rules, financial directives, anti-money laundering and terrorist financing reglementations have exploded at the national and regional levels, increasing the regulatory pressure on all companies subject to these rules. Between 2009 and 2012, over 50 000 regulations were published across the G20 !

According to the Regtech Council (1), it took no less than “30 000 pages and 1.5 million paragraphs to describe the rules in MiFID II (2) and has cost the industry some €2.5bn to date to implement this new regulation”.

The need for innovation has led to the emergence of the Regtech market

If we take the example of the MiFID II directive alone, a legislative framework that regulates EU financial markets, it has been estimated that firms on the European continent have already spent $750 million annually to ensure their compliance. This has driven a structural need for innovation and led to the advent of process automation solutions across the entire regulatory value chain.

Thus, a wave of startups have emerged to offer technological solutions that allow companies to efficiently and-cost-effectively manage the overload of compliance. Those “Regtechs” are mostly young companies that offer SaaS, predominantly cloud-based, solutions that bring agility, speed, integration and analytics to meet regulatory expectations and manage risks.

140 startups to manage regulatory requirements in Europe

The multitude of innovative startups tackling this huge complex market made us investigate, map and categorize european regtech players.

Here is what our mapping taught us :

● 30% of those startups belong in the category we called Compliance Management, that is composed of tools helping executives to meet regulatory requirements

Startup case


Regbot is an irish company that has built ​a virtual compliance expert that ensures that regulatory obligations are fully monitored and met at all times, eliminating the need for unnecessarily conservative business policies that restrict business opportunities.

● 27% of those startups focus on KYC and AML (3) automatization solutions

Startup case


eID is a spanish software company that has developed many KYC products among which VideoID, a technology that combines video streaming with the most advanced machine learning and artificial intelligence algorithm to identify people in just seconds from any device and through any channel.

● 26% of those startups leverage technology and data to provide companies with Risk Management tools

Startup case

©Risk Ident

The German startup Risk Ident has developed FRIDA, an all-in-one solution for intelligent fraud prevention that scores transactions in real time and learns from every fraud case, automatically adapting to new fraud patterns without additional configuration.

● 17% of those startups leverage their technology to build Regulatory Reporting solutions

Startup case


In Switzerland, Deltacon X’s value proposition is to offer companies full automation and dynamic error handling, making reporting processes massively simplified and minimising manual work and human errors.

A preponderance of UK startups

Our Mapping also taught us a lot about the geography of European Regtech startups. It appeared that over 40% of the startups we found within this space are UK based, followed by Ireland (10%) and Luxembourg (9%). This might be explained by the historical financial dynamism of London City, but it definitely raises questions regarding Brexit and the sustainability of those british companies in the coming years. Will the industry cards be distributed again?

Here is a mapping of 140 european startups in the regtech industry, a sector that has sparkled our interest at XAnge!

With more than 130 regtech start-ups identified, we have chosen to present the main categories in which XAnge invests, so this mapping is not exhaustive. If you have any ideas for companies that are missing or misplaced, please let us know :

(1) Not-for profit think-tank, which provides a bridge between regulators, firms, academia and the wider financial and technology
(2) MiFID II is a legislative framework instituted by the European Union to regulate financial markets in the bloc and improve protections for investors with the aim of restoring confidence in the industry after the financial crisis exposed weaknesses in the system, ​Investopedia
(3) Know Your Customer and Anti Money-Laundering