KPMG: Strong Close for Fintech Deals in Q4 of 2017 as $31 Billion Invested During the Year

Last week, KPMG published its quarterly report on Fintech deals stating global investment in innovative finance hit $8.7 billion during the quarter. For the year, 2017 was said to have established the third highest total, at $31 billion, invested in Fintech for the decade. KPMG said that Fintech firms are maturing and corporate VCs are becoming more strategic as what was once new is quickly becoming the norm and not the exception. Quarterly Fintech deals in the US hit a high since 2015. In Europe, Fintech deals registered $2.05 billion with the UK receiving the bulk of this activity at $1.6 billion.

As will come as no surprise, KPMG said that Blockchain investment should have a solid year for 2018.  Blockchain investment hit $512 million globally during 2017 – a new sector high. Insurtech, another robust subcategory, hit $2 billion during 2017 and is expected to “hit its stride” in coming months.

Median funding rounds are as follows: Seed Stage – $1.5 million; Early VC Stage – $5.5 million; Later Stage – $16 million. Pre money valuations for Seed Stage firms stood at $6.5 million

The Top Three Funding rounds during the past year:

  • Kabbage – $250 million
  • Dianrong – $220 million
  • Blend Labs –  $100 million

This edition of the KPMG Pulse included the top ten predictions for 2018:

  1. AI accelerates: Continued innovation and adoption of AI as an underlying tech
  2. Regtech rising: Increased investment in regtech around the world
  3. Building bridges: Greater collaboration and partnering between large-scale providers
  4. Next gen digital lending: The rise of online mortgage technology and platforms
  5. Beyond use cases: Early success efforts in the initiation of blockchain production systems
  6. Open banking: Open APIs pave the road for third party developers in Europe and Globally
  7. New challenger banks: Financial services incumbents building their own digital banks
  8. Insurtech innovation: Accelerated investment into driving insurtech innovations and building hubs around the world
  9. Going full-stack: Broadening of solution sets by mature fintech companies
  10. Big tech participation: More partnering between fintech and technology giants

The KPMG Pulse is always a great report with tons of perspective on emerging Fintech and investment. The report is available here.


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