Almost two years have now passed since the outbreak of COVID-19 completely changed our way of life, from the way we do business to the way we interact with each other in our professional and personal relationships. Today, however, it looks as though the nightmare is almost over, and if we look towards some key sectors, we can see that there is hope that a return to normality is closer than ever. It has often been said that fluctuations on the stock market often anticipate significant changes to business and the economy, and in a similar way, it is often those industries of the future that are the first to move towards the exit door in even the worst crises.
One such industry of the future is the fintech sector. Thanks to work by multinational organisation KPMG, who have been tracking the fintech sector since well before the pandemic, we can see today that capital investments around fintech startups are at record levels, well beyond the figures seen prior to 2020.
In the case of venture capital, the total number of deals was 50% greater than in 2018, but total investment more than doubled, reaching almost $115 billion. Looking at private equity finds, deals increased by 33% to reach a total investment of $12.2 billion, 135% more than in 2018. Looking modest by comparison, mergers and acquisitions have stayed around the levels seen in 2018 and 2020, but far from the peak seen in 2019, even if 2019 was something of a one-off year for high-value deals.
“2021 has been a remarkable year for the fintech market, with a record number of deals in every major region – including the Americas, EMEA, and the Asia-Pacific,” begins the executive summary of the Pulse of Fintech, H2’21
. “Fintech investment was incredibly strong, with both VC and PE investment soaring to record highs. The breadth of fintech solutions attracting investment continued to expand and grow, with surging interest in cryptocurrencies and blockchain, wealthtech, and cybersecurity.”
Here at GDS Modellica, we have put together an infographic so that our readers can get a quick idea of the key takeaways from this report, which, as ever, we recommend reading in full.