The Next Generation Of Financial Firms Is Making Delaware Its Home
In the last four decades, Delaware has established itself as the financial capital of the mid-Atlantic. The state’s business-friendly banking and tax codes have inspired some of the biggest names in the financial world to move to Delaware in droves, including JPMorgan Chase, Bank of America, Barclays and Capital One.
Delaware has the highest relative concentration of financial services jobs of any state in the U.S. Jobs in the financial services sector make up 9% of all the jobs in the state, which is nearly twice the national average. Wilmington serves as the hub of this massive financial sector, with nearly 170,000 financial services workers across the metro labor market. Now, the state has become a hotbed for the next generation of financial firms: financial technology, or fintech, companies.
“Most of our employees live in Delaware, and we’ve found that state officials and the entire business community are focused on supporting both businesses and residents,” said Frank Borchert, chief administrative officer and chief legal officer at Delaware-based fintech company Marlette Funding. “We feel like we’ve found a place where we can enjoy living, working and becoming successful.”
The Delaware in a Fintech Future report found that close to 200 fintech patents were filed in Delaware between 2009 and 2018, which is the most of any U.S. state on a per capita basis. Companies like PayPal, College Ave Student Loans, SoFi and Fair Square Financial call Delaware home and have been able to grow and attract significant venture capital funding.
Delaware is aiming to be at the forefront of the rapidly growing fintech market, which has only grown since the start of the coronavirus pandemic. A December 2020 survey found that fintech companies are catching up with traditional banks in terms of customer trust. Forty-two percent of respondents said they use at least one fintech account and 6% reported becoming a fintech user since the start of the pandemic.
What is drawing fintech companies to Delaware? Along with the business-friendly taxes, the No. 2 draw is likely the wide talent pool.
Large financial services firms with more than 250 employees account for 73% of all financial services employment in the U.S. In Delaware, those large firms account for 91% of statewide financial employment. Delaware is also just a short train ride away from financial and tech talent hubs like Washington, D.C., Philadelphia and New York
“Delaware has been home to a huge pool of financial services talent for decades, so we knew it was the right place for us to start,” Borchert said. “We knew that we could use this pool to build a fintech company that could rival anything coming out of San Francisco.”
Along with its access to experienced talent, the state offers a number of education and training programs to help foster the next generation of financial experts. These programs include Delaware Pathways, which gives high school students an opportunity to earn college credits to work toward industry certifications, Zip Code Wilmington, which teaches people of all ages how to code, and several degree programs in fintech at the University of Delaware, Delaware State University and Wilmington University.
“In Delaware, we have access to a highly skilled, diverse talent network,” said Julie Wakefield, business manager at Barclays, a multinational bank and financial services company with a U.S. consumer business headquartered in Delaware. “There’s a great infrastructure here, where Wilmington is positioned, it is close to New York, Washington D.C., New Jersey, Pennsylvania and Maryland [so] that it gives us access to an even broader workforce across the mid-Atlantic.”
Wakefield said her colleagues appreciate that Delaware is a nice, affordable place to live, and Barclays has taken every opportunity to get involved in the community.
“There’s a lot of exciting things happening in Delaware, and it’s a growing area for fintech innovation,” she said. “We work very closely with local schools and startups in the community and it’s been a great way to give back while instilling in our colleagues a strong sense of community. It’s a very growth-oriented, forward-thinking place, which aligns with our mindset as a company.”
Borchert said Marlette has been able to thrive in Delaware, and that success has not gone unnoticed by the company’s competitors in some of the nation’s most well-known tech hubs.
“This is a great community to be a part of,” Borchert said. “We’ve had great success and steady growth in the state that have allowed us to serve people across the country. We’ve noticed some of our West Coast competition has decided to open up branches in Delaware, and we expect that our future growth will be here as well.”
This article was produced in collaboration between Delaware Prosperity Partnership and Studio B. Bisnow news staff was not involved in the production of this content.
Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to firstname.lastname@example.org.