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FinTech hyper investing clouds the global Venture Capital vogue

The multinational startup fundraising bonanza has boosted practically every industry you can think of, Educational Technology soared throughout the last two years, software gained traction, SpaceTech and BioTech which are considered as long-term and high-risk are also indicating good results.

However, there are not any startup niche categories or sectors that performed better than financial technologies.

Fintech startups globally are raising dazzling portions of resources. Locations such as Latin America, Africa, North America and many more are observing the rise of tectonic rounds of investment full of investors who are eager to put their own money to work in projects like neobanks, payment service providers, lending service providers, virtual currency service providers, trading apps and other sub-sectors.

As per the private equity company CB Insights, their 2021 State of Venture Report shows that global venture funding peaked at a record high of $621 billion in 2021. This number is twice the figure set for the previous year of 2020, which stands at $294 billion.

In 2021, worldwide fintech funding reached a new high of $131.5 billion from 4,969 transactions, setting a new record. In 2020, $49 billion were invested in 3,491 transactions.
As can be seen, the rate at which money was invested in fintech firms in 2021 rose far faster than the total number of deals, resulting in bigger rounds on average.
The CB Insights statistics also help to put the pace of fintech financing into context when compared to peer startup groupings, with financial technology businesses collecting one out of every five VC dollars last year or approximately 21%.

Throughout the course of Q4 of 2021, fintech backing topped $34.9 billion following Q2 of 2021 at $36.6 billion. The transactional volume compared remains similar with 1,224 in Q2 versus 1,256 in Q4.
To construct those figures in a more comprehensible way, 14 fintech agreements were reported every single day in the fourth quarter totalling $387,777,777 per 24 hours.

Fintech venture is getting so large that its contours match those of the venture capital market. United States of America dominated in fintech financing in the fourth quarter, as well as in overall VC dollars for the year. In terms of fintech investment, the U.S. trailed Asia and Europe with $18.2 billion invested in U.S. fintech, $8.2 billion in Europe and $5.6 in Asia.

Photo by Adam Nir

About the author, Deyvid Stoyanov

Deyvid developed his passion for technology, innovation, blockchain and decentralization throughout his bachelor and masters degree studies in Bulgaria and Italy. With several years of experience in the private sector, he is currently part of the FinTech Legal Center Tallinn-based team and remains immersed in the transformation of the financial and banking sector, the adoption of blockchain and cryptographic technologies as well as their interrelationship with state supervisory authorities and the European regulatory structure.

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