I’m often asked how much is being invested in Fintech and where is it going? Based upon a lot of assumptions and studies, the figures this year look like they’re heading near $30 billion invested in Fintech, with most in Silicon Valley. A third is in payments, of which 10% is in blockchain and bitcoin companies; a quarter is going into crowdfunding and social lending ventures, although much of this is supporting the rise of the unicorns; a fifth is going into wealth management and capital markets; and the rest is in a range of areas from data analytics to contextual servicing to personal financial management.
Whilst I tout these numbers, I decided to see if there are any good stats that show more granularity, so here goes.
Investments in the fintech space have tripled from $4.05 billion in 2013 to $12.21 billion in 2014. Online lending startup Sofi raised $1 billion in September, the biggest financing round by any company in fintech. [Business Insiderhttp://www.businessinsider.com.au/break-the-banks-hackathon-2015-12 ]
Many of the disrupters in this sector that wanted to shake up banking will instead end up as vendors to the banks. Lending Club, SoFi, Prosper and Kabbage have all signed deals with traditional financial institutions, ranging from ING to Citizens. [Financial Times]
Geographically, the situation is diverse with the US leading with $31.6 billion (£20.5 billion) of the total $49.7 billion (£32.3 billion) invested globally so far. The UK ($5.4 billion), Europe ($4.4 billion), China ($3.5 billion) and India ($2.2 billion) are the next most vibrant markets. [William Garrity Associates]
London is one of the biggest FinTech clusters in the world, in some ways rivaling the States’ mythical Silicon Valley. And investment in the sector is continuing to climax. In the first nine months of 2015 it had attracted $554 million of venture capital funding compared with $487 million for the whole of 2014, a figure that in 2013 had been hurrahed at reaching$265 million – eight times the amount logged for 2008. [Tech.co]
Fintech investment in Asia-Pacific has skyrocketed in 2015 — from about US$880 million in all of 2014 to nearly US$3.5 billion in just the first nine months of 2015. US$461 million has been invested in 54 blockchain companies during the first nine months of 2015. [Accenture]
According to a study by IVC Online, Israel has a thriving fintech industry, with 430 companies and 14 multinational R&D centers, and a 2014 record of 61 companies that raised $369 million in capital. [Globes]
Feel free to send me stats for your part of the world to flesh out this list with up-to-date numbers.