Fintech bonanza as start-ups raised $4bn globally in Q3 2017

18 Oct 2017

Image: wutzkohphoto/Shutterstock

Funding deals and dollars could top new highs in 2017 at the current pace.

Global fintech funding in Q3 dipped 25pc compared with the previous year as fintech companies backed by venture capital (VC) raised $4bn across 278 deals, according to new research from CB Insights.

If the current rate holds steady into the fourth quarter of of the year, global fintech investment could scale new heights.

The third quarter saw one new fintech unicorn emerge (Coinbase, with a $1.5bn valuation), one fintech unicorn go public (Zhong An Insurance) and one fintech unicorn (Prosper) raise a down round at a valuation of $550m.

Fintech bonanza as start-ups raised $4bn globally in Q3 2017

Infographic: CB Insights

The number of fintech funding rounds exceeding $50m remained strong during Q3, with a rough figure of 18 similar to the same time last year.

Seed/angel and Series A deals to VC-backed fintech firms dropped for the fourth consecutive quarter to a five-quarter low in Q3 2017.

New record for European fintechs

The good news is, European fintech funding deals reached a new record of $1.8bn across 216 deals.

At the current pace, European VC-backed fintech funding could break the $2bn mark for 2017.

In Europe, the big deals of the third quarter were: $66m raised by Revolut, $50m raised by Receipt Bank, $47.8m raised by Younited Credit, $40m raised by Prodigy, $30m raised by Onfido, $25m raised by, $25m raised by Rimilia, $24m raised by Habito, $22.5m raised by GoCardless and $14m raised by Tide.

Asian fintech investment also remained strong in Q3, with around 77 deals. At the present run rate, deals could rise 29pc compared with 2016.

Overall, fintech funding in Asia crossed the $5bn mark and is on pace for a record year. Top deals in Asia included Dianrong’s $220m, Sunshou Technology’s $200m and Janalaksmi’s $161m round.

In the US, fintech deals could fall below 2014 figures but still surpass 2016’s year-end high of $5.7bn.

Overall in Q3, US VC-backed fintech start-ups raised $1.9bn across 111 deals.

Among the top US fintech investments during the third quarter were: $250m raised by Kabbage, $151m raised by Upserve, $216m raised by Bread, $101m raised by Toast, $100m raised by Blend, $100m raised by Coinbase, $70m raised by Betterment, $60m raised by Raise, $50m raised by Prosper and $50m raised by HighRadius.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years