Only 3 fintech unicorns went public in 2018 — a year that also saw fintech startups raise a record number of $100M+ mega-rounds.
At the beginning of 2018, there were 25 VC-backed fintech unicorns around the world, worth a cumulative total of almost $76B.
With all of that hype, many speculated that these highly-valued startups might take advantage of their momentum and go public.
And when Dutch payments startup Adyen went public in June 2018, its IPO was a huge success: its stock surged 90% in its first day of trading, ending the day with a $15.8B valuation.
But in the end, the Adyen IPO was one of just three fintech unicorns to go public in 2018. (The other two were UK peer-to-peer (P2P) lender Funding Circle and US home improvement financing startup GreenSky).
This suggests that for many fintech unicorns, going public hasn’t been the top priority.
One reason highly-valued fintech startups — such as Affirm, Oscar, and Gusto — are able to avoid going public despite significant operating costs could be the increase in mega-rounds of $100M or more.
Across industries, mega-rounds have emerged as a legitimate alternative to going public to raise money. With more and more late-stage capital coming into startups, companies don’t need to submit themselves to public scrutiny and markets in order to fund their operations.
In 2018, mega-rounds to fintech startups hit a record high, with nearly $25B raised across 52 deals.
Looking at total deals, VC-backed fintechs raised almost $40B over 1,707 deals — a significant leap in both volume and deal size from 2017 figures ($18B over 1,480 deals).
Given the growing number of mega-rounds, the drag on fintech IPOs is not expected to abate in the coming years.
Fintechs like Lu.com, Oscar, Robinhood, and Dataminr all raised $300M+ rounds in 2018 — likely ensuring they can operate for years without needing to go public to raise funds.
FREE DOWNLOAD: STATE OF FINTECH q3’21
43 fintech unicorns were born in Q3’21, bringing the total to 206 — twice the Q3’20 count. Download the report to learn more.
This report was created with data from CB Insights’ emerging technology insights platform, which offers clarity into emerging tech and new business strategies through tools like:
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