The Pulse of FinTech, Q1 2016 Review
KPMG and CB Insights’ quarterly fintech VC report highlights a rebound in funding and deals from the pullback in Q4’15
After a notable pullback in funding to VC-backed fintech companies in Q4’15, mega-rounds lifted quarterly investment into VC-backed fintech companies by over 150 percent in Q1’16.
In total, global investment in private fintech companies US$5.7 billion in Q1’16, with $4.9 billion invested in VC-backed fintech companies across 218 deals, a 96 percent funding jump compared to the same quarter last year on the back of mega-rounds including JD Finance and Lu.com. On a quarter-over-quarter basis, VC-backed fintech deal activity rose 22 percent in Q1’16.
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North America saw both fintech funding and deals rebound following a major drop in Q4’15, as VC-backed fintech companies raised US$1.8B across 128 deals, an increase of 80 percent in funding quarter-over-quarter, bolstered by deals including Oscar Health Insurance and Betterment in New York.
Europe saw VC-backed fintech deals reach a five-quarter high, rising to 47 in Q1’16. Europe fintech funding remained almost level with Q4’15’s total at US$0.3B.
Larger deals spurred fintech funding growth in Q1’16. Q1’16 saw 13 $50M+ rounds to VC-backed fintech companies, a slight rise from the 10 $50M+ rounds in Q4’15, but a drop from the 18 mega-rounds in Q1’15.
North America funding bounces back
Europe sees deal high; no jump in funding
Size of mega-rounds spur fintech funding growth in Q1’16
Corporates participate in 1 of every 5 fintech deals for fifth straight quarter
Corporate investors continue to play a large role in the fintech ecosystem, with global deals to VC-backed fintech companies standing at 24 percent + in three of the past five quarters.