Fintech Startups See Accelerated Growth as New Innovations Cool

The pandemic and resulting economic toll has presented challenging headwinds for startups. In this post we look back on Q2 ending funding trends for fintech startups to determine the trajectory of innovation in this emerging technology sector.

Below we see that the number of funding events per quarter has been on a downward trend, with 137 deals closing in Q2. This implies that new innovations in the fintech sector are slowing down as measured by the volume of disruptive companies attracting investments.

That said, below we can see that for the companies that are getting financed, the average funding per deal has been on an upward trend with an average deal size of $54M in Q2. This implies that the market is bullish on the traction and growth potential of these fintech startups.

In summary, while the number of fintech financings is cooling off, the startups that are raising money are gaining momentum. As fintech startups raise larger sums of money to fund their growth, they will present ever greater challenges and opportunities to incumbents and legacy business models.

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