The Pulse of FinTech, 2015 in Review

KPMG and CB Insights’ quarterly fintech VC report highlights a record year for VC-backed fintech startups in 2015, despite pullback in Q4

Corporates active in one of every four fintech deals:

Corporates have participated in 25% or more of all fintech deals for 3 quarters straight, as corporates in financial services, telecom, and technology have become increasingly active.

US funding hits new high-water mark: 

2015 was a new high-water mark for fintech finanacing as mega-rounds pushed US fintech funding to $7.39B across 351 deals. On a year-over-year basis, 2015 saw a 2% rise from 2014’s fintech funding total. The increase in US fintech funding came amid a minor increase in deals from the previous year.

Deals taper off in second half of 2015:

Large deals were the headline of 2015, largely driving the funding trends. Deal activity fell for the final 2 quarters, including Q4’15, which saw just 154 deals.

Europe fintech funding deals rise in 2015:

VC-backed fintech companies in Europe raised $1.48B in funding across 125 deals in 2015. It was the second straight year of $1B+ invested in European fintech companies, as deal activity rose 28% on a year-over-year basis.

While 2015 marked a banner year for the fintech sector highlighted by newly minted unicorns and increased involvement by financial services giants, Q4’15 saw investment to venture capital-backed fintech companies cool off.

VC-backed companies are taking a greater portion of overall fintech investment. In 2014, VC-backed companies made up 55% of overall fintech investment dollars. In 2015, VC-backed fintech companies took 73% of overall fintech funding.

Mega-rounds spread through fintech:

Between 2011 and 2013, there were fewer than 15 $50M+ rounds to venture-backed fintech companies in aggregate. In 2015 alone, the number of $50M+ fintech deals jumped past 60.

Asia fintech funding quadruples 2014 total:

In 2015, funding to VC-backed fintech companies in Asia exploded to hit $4.52B across 130 deals. The increase is attributable to a notable rise in $50M+ fintech deals, which included One97, Dianrong, and BankBazaar, among others.