- In the first half of 2017 UK based FinTech companies received more than two thirds of the total amount invested in 2016 and are on track for a record year if the election results don’t have severe impact. This was seen last year when two thirds of the total funding were committed in the first two quarters.
- The total amount invested in UK based FinTech companies grew at a CAGR of 18.1% between 2014 and 2016.
- In 2016 total investments fell by 6.7% YoY, however this was due to a 45.6% fall in the amount invested in deals valued above £75m. Smaller deals valued under £75m saw an increase of 17.9% between 2015 and 2016.
Despite a fall in the total number of deals in Q2 the number of investments rose to a 6-Quarter high.
- Total FinTech investments have picked up after falling to £203m in Q3 2016 after the Brexit referendum. The first half of this year saw 16.9% more investment than the first half of 2016. Moreover, the total amount invested in Q2 2017 remained consistent with the same quarter last year.
- Since Q4 2016 the number of deals to FinTech companies based in the UK has risen by 14%.
- One of the largest investments to FinTech companies based in the United Kingdom in Q2 2017 was to P2P lending firm Zopa which received £32m in a series E deal in June.
FinTech companies based outside of London are attracting increased interest from Investors
- Between 2014 and 2015 the share of total investment to FinTech companies based outside of London fell by 3%. In 2014 the 16% share of investment was partly due to a £40m deal to Peterborough based Aldermore Bank. This deal alone made up 6.3% of the total amount invested in UK FinTech companies in 2014.
- Since 2015 the share of Investment in FinTech companies based outside of London has progressively increased to 29% in the first half of this year. FinTech copanies based outside of London received £97.1m more investment in 2016 than in 2014.
- So far in the first half of 2017 Durham based Atom Bank raised £83m in Q1 and Altrincham based Paybreak, which develops retail finance solutions, raised £24.5m in Q2.
The top three sectors; Payments & Remittances, WealthTech and Marketplace Lending received 47% of deals to FinTech companies in the UK
- The Payments & Remittances sector received the highest number of deals between 2014 and Q2 2017. The largest deal in Q2 2017 went to mobile payments and rewards company Yoyo Wallet, which received £12m in June.
- Infrastructure & Enterprise Software, Real Estate and RegTech companies have received just over one quarter of deals since 2014. In this period, these sectors received £343.6m, £312.5m and £95.4m of investment respectively.
- 13% of deals went to other FinTech Sectors, these include companies specialising in InsurTech, Cryptocurrencies and Blockchain.
The top ten investors took part in one quarter of deals to FinTech companies based in the UK between 2014 and Q2 2017.
- The top ten investors in FinTech companies based in the UK between 2014 and Q2 2017 took part in 25.3% of deals with the most active investor, Seedrs taking part in 6.3% of deals.
- Eight out of the top ten most active investors are based in the United Kingdom. The remaining two; Global Founders Capital and Index Ventures based in Berlin and Geneva respectively. Thus 100% of the top ten most active investors in UK based FinTech companies are based in Europe.
- The top two most active UK investors are both equity crowdfunding platforms which allow individuals to invest in start-ups. Of the remaining eight investors, there are two accelerators; startupbootcamp and the Barclays Accelerator and six VC firms.
