Enterprise fintech VC deal activity saw a slight uptick in Q3. Deal value rose from $3.9 billion in Q2 to $4.1 billion, “representing a 5.1% QoQ increase. On a YoY basis, however, deal value was down 33.0%, highlighting the more conservative deployment of capital from investors,” according to an update from Pitchbook.
Pitchbook noted that fewer deals were “seen this quarter, with 296 total deals in Q3 versus 361 in Q2, indicating higher levels of capital were deployed in deals.”
Capital continued to “stay biased toward B2B, with 63.0% of total fintech VC in Q3 allocated to enterprise fintech companies.” Pitchbook also mentioned that this “was a notable retreat from the 71.0% of VC captured by enterprise fintech companies in Q2, suggesting that B2C models have not been completely overlooked.”
Similar to last quarter, top deals in Q3 “came predominantly from late-stage companies.”
The Pitchbook report further noted that these “include capital markets startup Micro Connect’s $458.0 million Series C, expense management platform Ramp’s $300.0 million Series D, credit scoring firm Perfios’ $229.0 million Series D, market intelligence platform AlphaSense’s $150.0 million Series E, and employee ownership startup Teamshares’ $130.2 million Series D. Some notable deals were also seen for earlier-stage companies, including B2B financing platform Defacto’s $182.4 million third VC round (a mix of debt and equity) and nondilutive financing provider Efficient Capital Labs’ $103.5 million seed round (a mix of debt and equity).”
Pitchbook pointed out that exit activity levels “continued to stay depressed, with $1.4 billion in exit value recorded in Q3.”
However, the majority of this was “due to Visa’s $1.0 billion acquisition of Pismo, which closed in July. YTD, exit value sits at $2.3 billion for enterprise fintech companies, representing a drop of 87.4% compared with the same period in 2022.”
However, two notable enterprise fintech IPOs “were seen on the Tokyo Stock Exchange: Netstars and Fast Accounting recorded exit values of $157.3 million and $42.5 million, respectively.”