Global fintech entrepreneurship and its influencing factors: An evolutionary economic analysis

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Abstract

Fintech entrepreneurship has already influenced financial markets and their players worldwide in a disruptive, but also a risky way (Thakor, 2020; Zeranski & Sancak, 2020). In this context, it seems worthwhile to analyze which factors drive the design and development of global fintech entrepreneurship. Thus, the paper takes fintech-related research a step further by exploring the drivers of fintech evolution in different countries and continents that display different levels of fintech activity. For this purpose, first economic, technological, legal, and cultural factors influencing the development of fintech entrepreneurship are examined from an evolutionary point of view, and second, a generalized linear mixed model is used in order to evaluate the statistical relevance of these factors on fintech entrepreneurship more comprehensively. The analyzed data period from 2000 to 2017 also makes it possible to assess the influence of the dot.com bubble and the financial crisis on fintech entrepreneurship. The results of the empirical analysis suggest that the gross domestic product (GDP), regulatory burden, government tech procurement and the degree of individualism are important drivers of fintech startup activity. These findings help gauge the present and future market position of fintechs, leading to implications for entrepreneurs, competitors, and regulators alike.

Keywords: Fintech Entrepreneurship, Startups, Innovation, Financial Institutions, Evolutionary Economics

Authors’ individual contribution: Conceptualization – T.H. and A.H.; Methodology – T.H., A.H., and J.S.; Formal Analysis – J.S.; Investigation – T.H. and J.S.; Writing – Original Draft – T.H. and A.H.; Writing – Review & Editing – T.H. and A.H.; Visualization – T.H.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: G20, M13, O16, O30

Received: 22.12.2020
Accepted: 26.02.2021
Published online: 01.03.2021

How to cite this paper: Holtfort, T., Horsch, A., & Schwarz, J. (2021). Global fintech entrepreneurship and its influencing factors: An evolutionary economic analysis. Risk Governance and Control: Financial Markets & Institutions, 11(1), 61-79. https://doi.org/10.22495/rgcv11i1p5