500 Startups leads the way as FinTech’s most active investor with over 100 deals
- The top 10 most active investors in FinTech participated in over 600 deals during the period 2014-Q1 2017.
- Two investors eclipsed the 100-deal total. Serial US-based Accelerators 500 Startups and Y Combinator participated in 105 and 103 deals each respectively during the period.
- Out of the top 10, seven are US-based. The remaining three are all based in the UK (Startupbootcamp, Index Ventures, Seedrs).
Khosla Ventures tops the average deals size pile of FinTech’s most active investors
- The chart above shows how there’s a divide in FinTech most active investors in the sense that half are more focused on smaller, and therefore earlier stage investments than the other half. The average deal size for the later stage investors; Sequoia Capital, Khosla Ventures, Index Ventures, Ribbit Capital, and Digital Currency Group, are all over double the size of any of the other investors’ averages.
- Khosla Ventures had the highest average deal size of any of the most active VCs with an average investment round participation size of $47.8m.
- Startupbootcamp had the lowest average deal size with $0.1m. This is due to over 95% of their deals consisting of seed deals. This can be attributed as to why, say for example Seedrs, who participated in 10 less deals than the London-based company, had over 20-times their investment value.
The top 5 most active VCs in FinTech sees Sequoia Capital participate in the most investment overall with over $2.5bn, while 500 Startups leads the way for early-stage investors
- New York-based Sequoia Capital participated in the largest total investment of the top five most active VCs in FinTech with over $2.5bn. The largest funding round Sequoia participated in was a Series C round received by Clover Health valued at $160m in mid-2016 – Sequoia was a co-investor in a round led by Greenoaks Capital.
- Four of the five VCs are US-based. Sequoia Capital are joined in the top five by Khosla Ventures and Ribbit Capital, who are both based out of Menlo Park, California. Palo Alto-based Digital Currency Group rounds off the top five.
- Mountain View-based 500 Startups’ investments accrued the largest total FinTech investment participation of any of its fellow earlier-stage investors with over $150m worth of deals.
VCs focus more on innovative technologies such as Blockchain whereas earlier stage investors see opportunity in more traditional FinTech sectors
- Both the VCs and Accelerators that invest in FinTech saw Payments & Remittances as the most appealing sector to invest in during 2014-Q1 2017. The top five investors of each focused 20.4% and 20.9% of their investments on the sector, respectively.
- Of the six most frequent sectors for investment for both VCs and Accelerators, four are ever-present – Payments & Remittances, Marketplace Lending, WealthTech, and Infrastructure & Enterprise Software.
- VCs focused on investments into technologies like Cryptocurrencies and Blockchain, neither of which feature prominently across the other most active investors.
- The most active investors that focused on early-stage deals spread their portfolio more widely than their VC counterparts. Under a quarter (22.5%) of VCs total investments went into FinTech sectors outside of their six most frequent. Accelerators and Funding Platforms’ investments were less focused however, with over 30% going into sectors outside of their six most frequent.
The top 10 most active investors participated in over 10% of the total investments and total deals in the FinTech sector respectively during 2014-Q1 2017
- 5% of the $75.5bn worth of investment into the FinTech space since the start of 2014 has been comprised of funding rounds that had at least one of Sequoia Capital, Khosla Ventures, Index Ventures, Ribbit Capital, or Digital Currency Group participating.
- The top 10 most active investors in FinTech from 2014 to the end of Q1 2017 participated in 633 deals collectively during the period. This figure is 10.4% of the total number of deals in FinTech during the same period.