Summary of findings
Q3’19 fintech funding topped $8.9B, a quarterly record when adjusting for Ant Financial’s $14B investment in Q2’18: As of Q3, fintech has raised $24.6B in 2019, already surpassing 2017’s annual total. Funding grew on the back of 19 $100M+ rounds worth approximately $4B in Q3’19.
Deals rebounded slightly in Q3’19 but are likely to fall short of 2018’s record as a result of a continued pullback in early-stage investing: Fintech deals in Q3’19 grew 6% from Q2'19, but they have dropped in every quarter in 2019 when compared to the same time frame last year. Early-stage (seed/angel and Series A) deals fell to an 11-quarter low and funding hit a 7-quarter low.
The US saw deals dip to an 11-quarter low while Asia saw deals spike and nearly surpass the US in Q3’19: The US saw deals dip as a result of a pull back in early-stage deals, which also contributed to the overall drop in 2019 global deals through Q3’19. Asia saw deals rebound as China reclaimed the lead from India as Asia’s top deal hub.
Southeast Asia fintech topped new annual highs: Southeast Asia set a new annual record with $701M raised across 87 deals through Q3’19. The top 2 deals since 2015 occurred in 2019: a $100M Series B to Singapore-based Deserka and a $100M Series C to Vietnam-based MoMo.
India and China continued to battle over the title of Asia’s top fintech hub in Q3’19: China saw deals surge to 55 in the quarter, reclaiming the lead from India with 33 deals. India saw $674M in funding, narrowly pulling ahead of China’s $661M.
Challenger banks have raised over $3B in 2019 YTD and Q3’19 saw $1.3B invested — a quarterly funding high: Q3’19 saw challenger banks funding bolstered by rounds to unicorns, including NuBank’s $400M Series F, which was the largest reported equity investment to a challenger bank and made NuBank the highest-valued challenger at $10B. Startup-focused challenger banks saw competition heat up with deals to Ramp Financial, Mercury, and Stripe, which launched card issuing.
There are 58 VC-backed fintech unicorns worth a combined $213.5B:
Q3’19 saw 6 new fintech unicorn births (Hippo, Judo, Deposit Solutions, QuintoAndar, Dave, and C2FO), and 3 more have occurred in Q4’19 as of 11/11/19 (Next Insurance, Ebanx, and Riskified). Other highly valued unicorns continued to raise late-stage capital, including NuBank, Gusto, and Stripe, among others, but none signaled an IPO was imminent.
Note: This report focuses on equity rounds to VC-backed fintech companies. This report does not cover companies funded solely by angels, private equity firms, or any debt, secondary, or line of credit transactions. All data is sourced from CB Insights.