The Responsibility

FINTECH INVESTMENT
The Heat
Global Fintech Investment Activity (2010-2015)
Fintech Investment by Region 2010-2015 ($m)
Is On
Source: CB Insights
12,000
Total Funding ($m)
736 791
Number of Deals
Source: IC Dowson and William Geraty Associates
Fintech is attracting a
record breaking amount of
investment, writes Ben Rooney
9,000
6,000
3,000
173
445
580
478
To say that fintech is a hot sector right
now is a bit like saying the Kardashians
are a family of sisters: it is true but it
rather misses the point.
According to data from analysts CB
Insights, 2015 is on track to be a record
year, more so than 2014, which itself was
a record year for investment.
Over the previous five years, investors’
money has flooded into the sector: some
$50 billion, with the lion’s share, $31.6 billion,
going to companies based in the U.S.
However, with London’s role as a global
financial hub, the UK is establishing itself
as a second — albeit by some considerable
margin — player, with more investment in
the UK than the rest of Europe combined
— $5.4 billion against $4.4 billion, according
to a report by UK advisors IC Dowson
and William Geraty Associates.
According to a report by Accenture, in
2014, the most popular sectors included
payments, lending, trading technologies
and wealth management.
Payments accounted for the largest
number of fintech deals in the United
States in 2014, at 29%.
Lending was the second-biggest
investment area for U.S. fintech investments
in 2014, accounting for 16% of such
investments.
CB Insights data suggests increasing
activity by traditional banks in the sector.
The UK’s Barclays Bank, through its
accelerator program, was the fifth-largest
investor (by number of deals) last year.
Silicon Valley Bank and Goldman Sachs
also featured strongly.
However, while money has flooded
into the sector, exits, whether through
M&A or other routes, have grown at a
far slower rate, perhaps indicating the
immaturity of the sector. In a quiet IPO
market, some 12 fintech companies went
public in 2014, according to CB Insights
data. Lending Club’s December 2014 IPO
valued the company at $5.4 billion.
Financing Activity (2010-2015)
Seed/Angel
43.57%
19.11%
Series C
7.94%
9.77%
2010
(Q3 & Q4)
Number Of Exits
Source: CB Insights
50
5
2010
(Q3 & Q4)
125
4
Percentage
of deals
Series A
26.50%
15.70%
Series D
3.42%
14.87%
2011 2012 2013 2014 2015
(Q1 & Q2)
186
6
Deal growth (YOY) Average deal size ($m) Median deal size ($m)
Series B
15.30%
9.37%
Series E+
3.27%
14.87%
1.1
0.7
Seed
/Angel
136
9
6.8
4.7
Series A
14.7
9.0
Series B
205
12
25.0
15
Series C
M&A
32.5
18.5
Series D
153
5
2011 2012 2013 2014 2015
(Q1 & Q2)
Average Amount Raised Before Exit ($m)
Source: CB Insights
2010
2011
2012
2013
2014
2015
Source: CB Insights
26.03
22.21
14.35
23.09
19.91
51.48
70.06
67.71
91.15
M&A
105.56
30.6
20.0
Series E+
IPO
IPO
117.49
CANADA
$761
Innotribe Global Fintech Hub Rankings
The Innotribe Global Fintech Hub Rankings are an attempt
to rank the hubs around the world using three different
systems and combining them. The Global Financial
Centers Index is a ranking of the competitiveness
of financial centers based on over 29,000 financial
New York
1,544
785
64
695
Seoul
1,390
718
58
614
USA
$31,600
SOUTH
AMERICA
$99
UK
$5,400
EUROPE
$4,400
center assessments. The aim of the GFCI is to
examine the major financial centers globally in terms of
competitiveness. It is compiled and published twice a
year by Z/Yen Group. The SparkLabs Global Ventures
score is compiled by the venture fund of the same name.
London
784
53
683
Singapore
754
40
586
ISRAEL
$453
AFRICA
$329
MIDDLE
EAST
$45
INDIA
$2,200
CHINA
$3,500
Global Financial
Centers Index
San Francisco/Silicon Valley
708
75
655
Chicago
707
40
601
HONG
KONG
$154
SINGAPORE
$167
SparkLabs Global
Ventures Score
1,520 1,438
1,380 1,348
AUSTRALIA/
NZ
$370
SE ASIA
$345
CITIE City
Report
Finally, the CITIE City Report is the product of a
partnership between the UK body Nesta, Accenture
and the Future Cities Catapult. It examines cities
across the world under nine different categories and
scores them.
Source: Z/Yen Group, venturebeat.com, CITIE Report 2015
10 October January 2015 2015
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