April 6, 2016
The LTP team has been actively following the investment activities in FinTech around the world for the last three months (January, February & March) and it’s time to sum up Q1 2016 with respect to FinTech.
In this overview, we have considered all financing cases excluding mergers and acquisitions. In total, in Q1 2016, $8.494 billion have been scattered across 367 funding deals and seven segments. A total of 590 investors, among which are large corporate players, have ensured the investments across these deals.
As expected by the results of the three months, banking/lending was the most attractive segment for investors as 28% of companies that raised funds are classified into the category. Payments/loyalty/e-commerce companies are holding the second place with 23% of the companies operating in the segment. And the third place belongs to securities/capital markets/wealth management companies (19%).
Companies that have substantially lower representation are from financial management solutions (13%), FinHCIT (9%), insurance (6%) and financial BPO (2%).
Even though banking/lending is represented by the largest number of companies, payments/loyalty/e-commerce companies have attracted almost half of the funds – 46% (almost $4 billion). Banking/lending companies have raised 30% of the funds (close to $2.6 billion). Substantially fewer funds have been raised by the rest of the companies ($2 billion in total).
In absolute numbers, a significant part of the total funding in Q1 2016 went to just two segments: banking/lending and payments/loyalty/e-commerce. Disappointment can be expressed about the insurance segment, which—despite all the hype around InsurTech—attracted the least funding: $131 million. Combined with FinHCIT, there was a significant funding ($830 million), but better times for InsurTech are still ahead.
Meituan-Dianping, China’s largest group deals site, was the one that raised the most funds in Q1 2016. The Asian giant has attracted almost half of January’s total funding from Baillie Gifford, Capital Today, DST Global, Temasek and others.
Oscar, one of the hottest InsurTech companies in the market, raised $400 million from Fidelity Investments, Founders Fund, General Catalyst Partners, Google Capital, Khosla Ventures, Lakestar and Thrive Capital.
WeLab is disrupting traditional credit services in Greater China and operates WeLend.hk in Hong Kong and Wolaidai, a mobile app, in China. The company has attracted $160 million from Guangdong Technology Financial Group, ING Group NV and Khazanah Nasional.
EDM Group is the UK's leading provider of document digitization services with a nationwide network of specialist facilities. BlueBay Asset Management and Lloyds Banking Group have invested $145.1 million in the company.
Leading robo-advisory platform powering automated investments, Betterment, has raised $100 million from Anthemis Group, Bessemer Venture Partners, Francisco Partners, Investment AB Kinnevik and Menlo Ventures.