In 2016 data according to Business Insider data shows that the Fintech “funding volumes” decreases year over year looking at 2016 vs 2015. The number was about 12.7 million in 2016, so about 13% down from the 14 billion dollar number in 2015. However, the number of deals stayed around the same, indicating that it was the size of the deals that caused this decrease in funding volume. There are a few potential factors that could account for this. Due to the large amount of funding in 2015, that may have left less money from VC companies to fund fintech companies in 2016. We may even see that trend continue into 2017. In fact the article notes that if not for two large deals in China the year over year decrease in VC funding of Fintech companies would amount to around 28%. There was more caution in the overall market in 2016 as well, and that could have also led to a lower amount of funding overall by VC firms. However, looking at the potential for Fintech companies, especially in today’s business environment, there is ample room for market disruption which could pave the way for record funding numbers. This extends to emerging fintech sectors such as P2P lending, online banks, and fintech “robo” advisors. Looking at 2017 will give a better idea of the direction that the fintech funding numbers will be trending.
http://www.businessinsider.com/fintech-deal-sizes-are-shrinking-2017-2
Pretty interesting blog post. I agree with Sahil, or Bill, in that it will be interesting given the massive opportunities available in the FinTech market space. I wrote a similar post that talked about how FinTech has showed promising investment trends for startups (check it out).