Global WealthTech investment reaches record levels with almost $3.5bn raised in the first three quarters of 2018 already

Investment in WealthTech companies is up 30% compared to last year

  • Almost $11bn has been raised by WealthTech companies globally since 2014, across 1,090 transactions, as the Wealth Management landscape undergoes continued transformation across all parts of the value chain.
  • WealthTech companies have raised over $3.4bn this year already, setting a funding record, 30% higher than 2017.
  • San Francisco-based Credit Karma, a credit and financial management platform, raised $500m of secondary market funding in Q1 2018. This investment from Silver Lake Partners is the largest WealthTech deal to date and Credit Karma has since scaled to more than 80m members, reaching a valuation of $3.5bn.

 

Q1 2018 set a record, with more than $2bn raised

  • More than $2bn was raised by WealthTech companies globally across 49 deals in Q1 2018, driven in part by the large investment that previously mentioned Credit Karma raised from Silver Lake Partners.
  • Just over $610m was raised in Q3 2018, which is less than half of the capital invested in WealthTech companies in Q3 2017. This strong performance in Q3 2017 was driven by an increase in larger deals in Asia. Feidee, a Chinese provider of online platforms for personal finance management, raised a $200m Series C round in September 2017. This funding, led by KKR, was the largest WealthTech deal of the quarter.
  • Deal activity between Q2 2017 and Q2 2018 dropped from 83 transactions to 46, however investment grew from $508.7m to $812.9m during the same period. London-based challenger bank Revolut, raised $250m in the largest WealthTech deal of Q2 2018. This funding was led by DST Global and pushed the company’s valuation to $1.7bn.

 

Almost $500m was raised in the top 10 WealthTech deals in Q3 2018

  • Just under $500m was raised in the top 10 WealthTech deals globally in Q3 2018, which is equal to 81.7% of the total capital raised in the subsector that quarter.
  • China-based Snowball Finance, a trading and financial social network platform, raised a $120m Series D round from Ant Financial. This round of financing will be mainly used to fund product development and recruitment.
  • London-based Monese, a provider of instant on-demand current accounts, raised a $60m Series B round from investors including Kinnevik AB, Augmentum Fintech and PayPal. This was the largest WealthTech deal of the quarter in Europe. Monese will use the funding to accelerate its international expansion and recruit more talent in its London and Tallinn offices.

 

Global WealthTech transaction sizes have been growing since 2015

  • The proportion of WealthTech deals valued below $1m halved between 2014 and 2017, falling even further to just 7.7% of deals as of the first three quarters of 2018.
  • The share of deals valued above $10m increased from a quarter of deals in 2015 to 63.3% in 2018 so far, as the proportion of venture deals at Series C stage and above increased from 9.4% to 17.3% during the same period.
  • $100m+ transactions’ share of deal activity has grown year on year from just 2.9% in 2014 to 6.3% in 2017, jumping to 17.1% this year so far. Brazilian-based challenger bank Nubank, raised a $150m Series E round in Q1 2018 led by DST Global. This is the largest Latin American WealthTech deal to date and the challenger bank has amassed more than 13m customers.

 

The data for this research was taken from the FinTech Global database. More in-depth data and analytics on investments and companies across all FinTech sectors and regions around the world are available to subscribers of FinTech Global. ©2018 FinTech Global

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