Now that 2018 is complete, let’s see how exit activity for financial technology (fintech) compares to previous years. The graphic below shows the total annual fintech exit events over time.
As the graphic demonstrates, fintech exit activity had the highest year on record in 2018 with 89 exit events. It represents a 2% increase from the previous year’s exit activity. In addition, fintech exit activity grew at a CAGR of 41% over the past 5 years. It’ll be interesting to see if its exit activity will drop in 2019 or reach even higher levels.
With 2018 now behind us, let’s examine how funding in financial technology (fintech) compares to previous years. The graphic below shows the total annual fintech funding amounts over time.
As the graphic demonstrates, 2018 experienced the highest fintech funding on record at $41B. It represents a whopping 78% increase from the previous year’s funding. In addition, fintech funding grew at a CAGR of 61% from 2013 to 2018. We’re excited to see if its funding can reach an even higher level in the new year.
Here is our Q4 2018 summary report on the financial technology startup sector. The following report includes a sector overview and recent activity.
The fintech industry has seen $125B in total all time funding. Let's analyze the investors making bets into fintech and identify the most active firms.
The graphic below shows fintech investors based on their number of investments into the sector. If an investor participates in two investment rounds in the same company, that would qualify as two investments for this graphic.
As the graphic demonstrates, 500 Startups has made the most bets in the fintech sector with 147 investments. Y Combinator follows in second place with 116 investments. Examples of companies 500 Startups invested in include Credit Karma, Finova Financial, First Circle, and Albert. It's interesting to note that Silicon Valley Bank is on this list, as sometimes it operates as a corporate investor in this space. Let's see which investors make their way onto this list over the next year!
We’ve previously highlighted that financial technology funding is on pace to have a record year in 2018. When we take a closer look at the categories that make up fintech, we notice that the Consumer Lending category leads in both Q3 and overall funding.
We’ll highlight this conclusion with some graphics and discussions below.
The Consumer Lending Category Leads Financial Technology In Q3 Funding
To start off, let’s review the amount of funding raised this quarter by each category within financial technology.
The above graphic highlights that the Consumer Lending category leads the sector in Q3 funding with $3.7B. Its funding is 2.5 times the funding of the next category, Business Lending at $1.5B.
Consumer Lending companies offer new ways for consumers to obtain personal loans and have credit risks assessed. They include peer-to-peer lending, micro-financing, big data analytics, and consumer credit scoring services. Some example companies are SoFi, CommonBond,...
The financial technology sector has reached record highs in its funding and exit activity. This blog post examines the different components of the fintech sector and how they make up this startup ecosystem. We will illustrate what the categories of innovation are and which categories have the most companies. We will also compare the categories in terms of their funding and maturity.
Consumer Lending Is the Largest Financial Technology Category
Let’s start off by looking at the Sector Map. We have classified 2,545 financial technology startups into 16 categories that have raised $118 billion. The Sector Map highlights the number of companies in each category. It also shows a random sampling of companies in each category.
We see that Consumer Lending is the largest category with 336 companies. These companies offer new ways for consumers to obtain personal loans and have their credit risks assessed. They include peer-to-peer lending, micro-financing, big data analytics, and...
Here is our Q3 2018 summary report on the financial technology startup sector. The following report includes a sector overview and recent activity.
We’ve previously determined that exits within the fintech sector grew exponentially over the past few years. Now armed with the data through June 2018, we’re conducting a mid-year status check on how this year is shaping up.
After conducting a deeper examination on our fintech research platform, we see that exit activity thus far in 2018 is trending slightly lower than in 2017.
2018 Mid-Year Fintech Exit Activity Lower Than 2017 But Higher Than 2016
Let’s take a closer look at the number of fintech exit events by year.
The above graphic shows 38 exits in the first half of 2018. For the past three years, Q3 and Q4 accounted for 50% of total exit events on average. If that trend holds, 2018 will have around 76 exit events. That would be slightly lower than the number of exits in 2017 but higher than that in 2016.
In summary, we observe that the fintech sector’s exit activity in 2018 is trending lower than 2017 but higher than 2016. We'll...
Here is our Q2 2018 summary report on the financial technology startup sector. The following report includes a sector overview and recent activity.
Last quarter we determined that fintech funding is maturing. This quarter we are taking a closer look on our fintech research platform to examine funding by category. From this analysis, we conclude that payments-related categories are outperforming all other categories by a wide margin.
This conclusion comes from two important takeaways:
- Consumer Payments leads the sector in Q2 funding
- Consumer Payments also has the highest funding growth percentage
We’ll explain these takeaways with some graphics and discussions below.
Consumer Payments Leads Fintech in Q2 Funding
To start off, let’s look at fintech category funding in Q2.
The above graphic shows that Consumer Payments leads the sector in Q2 funding with $15B, with Payments Backend right behind at $14.7B. It’s noteworthy that these payments categories are roughly 13 times larger than the next category, Business Lending.
So we’ve witnessed how different fintech categories stack up in their Q2 funding....
The financial technology sector has seen a lot of momentum in funding and exits in recent years. As we previously noted, fintech funding has shifted to later stages and its exit events have skyrocketed.
We will now take a closer look at the different components of financial technology and how they make up this startup ecosystem. We have classified the companies into 16 categories. This blog post will illustrate what these categories are and which categories have the most companies. We will also look at how these categories compare with one another in terms of their funding and maturity.
Consumer Lending Is the Largest Financial Technology Category
Let’s start off by looking at the Sector Map for the financial technology sector. As of March 2018, we have classified 2407 financial technology startups into 16 categories that have raised $90 billion. The Sector Map highlights the number of companies in each category. It also shows a random sampling of companies in each...
As previously seen, funding into financial technology has increased significantly in recent years. Now we are going one level deeper on our fintech report and research platform to examine its funding by round. From our analysis we can conclude that the fintech sector is continuing to mature over time.
This conclusion comes from two takeaways:
- Funding amounts are shifting from early-stage to later-stage events
- Funding counts are dropping in the Seed round and growing elsewhere
We’ll explain these takeaways with some graphics that show fintech funding activity by round.
To help set the stage, the graphic below illustrates fintech funding amounts over time. As you can see, the sector’s overall funding showed robust growth over the past few years.
Fintech Funding Amounts Shifting to Later-Stage Events
Let’s examine the fintech funding amounts by round as a percentage of the total, which show changes independent of the total size.
As shown in the graph, the...
Here is our Q1 2018 summary report on the Financial Technology startup sector. The following report includes an overview, recent activity, and a category deep dive.
Last quarter we reviewed fintech exit trends and found robust growth. This quarter we went one level deeper on our fintech research platform and conclude that the Payments Backend category leads fintech exit activity. Companies in this category include technologies impacting payment issuers and acquirers, as well as the infrastructure enabling payments.
This conclusion was derived from three takeaways:
- Payments Backend leads fintech in the number of exits
- Payments Backend leads fintech in the acquisition amount
- Payments Backend also leads fintech in the exit ratio
We’ll illustrate these takeaways with some graphics that show fintech exit activity by category.
To help set the stage, the graphic below shows fintech exit activity over time. As you can see, the sector is experiencing strong growth in exits.
Payments Backend Leads Fintech in the Number of Exits
We’ll start off by examining the exit events in each...
Our sector maps are snapshots of emerging technology sectors. They show what the different categories in a sector are and how many startups are within each category. They also present a small sampling of the current startups that are innovating in each category.
We will share our most up-to-date sector maps in a two-part series. Below you will find sector maps for the Blockchain Technology, Energy Technology, Financial Technology, Health Technology, Insurance Technology, Video Technology, and 3D Printing sectors.
You can see the other 8 updated sector maps for Artificial Intelligence, Internet of Things, Marketing Technology, Real Estate Technology, Retail Technology, Security Technology, Transportation Technology, and Virtual Reality here.
Blockchain Technology: 12 categories, 1007 companies, $6B in funding
Energy Technology: 12 categories, 790 companies, $63B in funding
Financial Technology: 16 categories, 2401 companies, $90B in funding
Health Technology: 22...
As we’ve examined in our previous analyses, the overall funding trends in Financial Technology (fintech) are stable and its exit activity is seeing robust growth, indicating that the sector is maturing as a whole. Yet what are the different components of fintech and how do they make up this startup ecosystem? On our fintech research platform, we have classified the companies in the sector into functional categories. This blog post aims to examine these categories and how they compare with one another through a series of graphics.
Payments-Related Companies Form the Largest Fintech Category
Let’s start off by looking at the Logo Map for the fintech sector. As of January 2018, we have classified 2,285 fintech startups into 16 categories which collectively raised $80 billion in funding. The Logo Map highlights the number of companies in each category and a random sampling of these companies. Please note that, for the sake of brevity, certain related categories have been...
The Financial Technology (fintech) sector has seen a lot of exit activity over the past few years. How does the number of exit events trend over time? Based on our fintech research platform, we have analyzed the data through 2017 and can conclude that fintech exit activity is seeing continued robust growth.
This observation was derived from two takeaways:
- Fintech exit events are demonstrating strong annual growth
- Fintech exit events are increasing at the quarterly level as well
We’ll illustrate these takeaways with two graphics that show the solid growth of fintech exit activity over time.
Fintech Exit Events Showing Strong Annual Growth
We’ll start off by examining the fintech exit events from 2011 to 2017. Exit events include both acquisitions and Initial Public Offerings (IPOs). The below graph shows the number of annual fintech exit events stacked by quarters.
This graph illustrates that fintech exit activity is...
Here is our Q4 2017 summary report on the financial technology startup sector. The following report includes an overview, recent activity, and a category deep dive.
Financial Technology (fintech) has seen a lot of venture capital funding over the past few years. How have its funding trends evolved over time? Through the insights derived from our fintech research platform, we conclude that the fintech sector is maturing.
We have come to this conclusion from the following four takeaways:
- Overall fintech funding trends are stable
- Fintech investor interest is constant
- Fintech funding has shifted to mid- and late-stage events
- The average fintech funding size is growing
We will illustrate these takeaways with a series of graphics to show that the sector is maturing.
Fintech Funding Relatively Stable in 2017
We will start off by examining the fintech funding trends over the years. Let's look at the annual fintech funding amount stacked by quarter.
As we can see from the graphic, fintech funding in the first three quarters of 2017 is slightly down relative to 2016....
The following graph summarizes investor activity in the Financial Technology (Fintech) space. Please note these graphics are made using data through July 2017.
The above analysis summarizes the total number of investment rounds Fintech investors participated in, and the number of unique companies funded by those investors. Major investors into the space include Accel Partners, Sequoia Capital, YC, 500 Startups, and Index Ventures.
We are currently tracking 2336 Financial Technology companies in 16 categories across 64 countries, with a total of $79.3 Billion in funding. Click here to learn more about the full Financial Technology market report.