Investments in Spanish FinTech companies fell by almost a fifth since 2014, but Q1 2017 hints at a strong resurgence

Private investments to Spanish FinTech companies fell again in 2016, continuing its steady decline since 2014. In contrast, the number of deals has doubled since 2014, with 40 FinTech deals closed last year. On average there have been 34 new FinTech Companies formed in Spain each year since 2014 and FinTech Global recorded 234 active FinTech companies in Spain at the end of 2016.

  • The volume of deals $2m and below has grown at a CAGR of 29.9% since 2014, in line with a 122.2% increase in the number of deals in that segment between 2014 and 2016.
  • The fall in total private investments is due to a fall in a small number of large deals valued above $2m. In 2014 63% of the total investment in Spanish FinTech was made up of two large deals totalling $8.1m. One of these deals was to Only-Apartments, a Spanish real estate platform, who raised $4.7m in May 2014. In 2015 investments above $2m fell to 25.6% of total funding. This 25.6% came from a $2.8m Series A funding round to accounting and expense management company Captio.
  • Figures for Q1 2017 paint a positive picture for Spanish FinTech. Q1 2017 saw $6.4m invested in Spanish FinTech, more than half of the total investment for the whole of 2016.
  • Q1 2017 has already seen a funding round above $2m. In February Housers, which allows individuals to invest in real estate, raised $2.4m.

The number of active FinTech companies in Spain is growing

  • The number of active FinTech companies based in Spain has grown by 41.8% since 2014.
  • 2015 saw 45 new FinTech companies emerge in Spain, while in 2016 only 24 new companies were recorded.
  • The number of active companies in Q1 2017 has remained constant from 2016 as no new companies founded in Q1 2017 have been identified.

Three sectors make up over half of the FinTech ecosystem in Spain

  • More than 50% of FinTech companies in Spain fall into 3 of the FinTech Subsectors; Payments & Remittances, Marketplace Lending and Infrastructure & Enterprise Software.
  • 20% of Spanish FinTech companies fall into the Payments & Remittances sector, making it the largest FinTech sector in Spain.
  • The smallest sectors in Spanish FinTech (grouped as other) include companies that fall into the Blockcain, RegTech, Cryptocurrencies and Data & Analytics sectors. Together they make up 10% of the FinTech Ecosystem.

Madrid is the FinTech Centre in Spain with 101 FinTech companies headquartered there

  • Of the 234 FinTech companies in Spain, 43.2% are headquartered in Madrid. Barcelona follows second with 21.8% of Spanish FinTech companies headquartered in the city.
  • 35% of FinTech companies in Spain are headquarters outside of Barcelona and Madrid in regional towns and cities.

Spain’s FinTech industry is well grounded and spread throughout the country. Despite a fall in total financing over the last three years, Q1 2017 has been a record quarter. The increase in deals valued $2m and below looks set to continue with companies such as Coowry, which allows international mobile payments raising $1.06m in February 2017. Whilst Q1 2017 saw the return of deals above $2m it seems as if funding is being spread more evenly with smaller, more frequent investments in new companies.

 

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