The big story for fintech investment in the first few months of 2017 was uncertainty. Whether it was the upset election victory of Donald Trump in the U.S., or continued concerns in the aftermath of the Brexit vote in the U.K., it was clear that venture capital – like much of the rest of the world – was taking a wait-and-see approach to deploying capital in the fintech industry in the first quarter of this year.
While more upbeat on European investment trends, CB Insights took a more conservative tone toward funding to VC-backed fintechs in the U.S. and the world at large. The firm suggested that the Q1 2017 investment pace globally was off the 2016 mark by 18%, with the U.S. Q1 2017 pace off by 20%. (Europe, by contrast, was on pace to exceed 2016 by 57%.)
The Q1 funding slowdown was apparent in our review of alum funding for the first three months of the year. Finovate alums raised more than $230 million in the first quarter of 2017. The funding total is less than half that of the previous Q1, and out of line with recent $600 million+ first quarters. The number of alums funded was also on the low end, falling below the 23 alum mark from the first quarter of 2014.
That said, we would be remiss if we didn’t point out that SoFi, which became a FinDEVr alum in March, raised $500 million in funding in February. And while that keeps them from being included in – and dramatically boosting – our tally, it is reminder that fintech investors in the first quarter of 2017 may not have been as overcautious as the numbers suggest.
Previous Quarterly Comparisons
- Q1 2016: $656 million raised by 32 alums
- Q1 2015: $680 million raised by 29 alums
- Q1 2014: $600 million raised by 23 alums
The biggest equity deal of the first quarter of 2017 was the $50 million raised by Kensho in February. Workfusion came in second, raising $35 million, and a trio of companies raised between $25 million and $20 million. The top 10 equity investment for Q1 2017 totaled more than $210 million, or more than 91% of the quarter’s total alum funding.
Top 10 Equity Investments
- Kensho: $50 million
- Workfusion: $35 million
- Currencycloud: $25 million
- Payfone: $23.5 million
- VATBox: $20 million
- NYMBUS: $16 million
- Qapital: $12 million
- Algomi: $10 million
- Dream Payments: $10 million
- blooom: $9.15 million
Here is our detailed alum funding report for Q1 2017.
January: More than $65 million raised by three alums
February: More than $107 million raised by 12 alums
- Rippleshot: $2.6 million – post
- AutoGravity: “double-digit million Euro investment” – post
- Bitbond: $1.2 million – post
- Blooom: $9.15 million – news
- Clinc: $6 million – post
- Kensho: $50 million – news
- NYMBUS: $16 million – post
- Pindrop Security: amount undisclosed – post
- Qumram: $1.5 million – post
- SecureKey: $800,000 – post
- VATBox: $20 million – post
- Venteny: undisclosed – news
March: More than $57 million raised by five alums
- Algomi: $10 million – post
- Currencycloud: $25 million – post
- Dream Payments: $10 million – post
- Qapital: $12 million – post
- SWITCH: $400,000 – post
If you are a Finovate alum that raised money in the first quarter of 2016, and do not see your company listed, please drop us a note at research@finovate.com. We would love to share the good news! Funding received prior to becoming an alum not included.