European FinTech deal activity in February drops 60% YoY

Key European FinTech investment stats in February 2023:

• 82 European FinTech companies raised funding in February 2023, a 60% drop from the previous year

• The UK was the most active FinTech country in Europe during February accounting for 46% of total deals.

• Blockchain & Crypto was the most active FinTech subsector in Europe during the month with a 21% share of deals

European FinTech deal activity in February has significantly declined from the previous year. Overall, 82 FinTech companies raised funding during the month, a 60% drop from February 2022. FinTech investment in the region has seen even a more dramatic reduction, dropping 89% from the previous year.

Zopa, a UK based digital bank, completed the largest FinTech deal in Europe during February 2023, raising $92m (£75m) in their latest Venture funding round, led by IAG Silverstripe. The company intends to use the funds to meet the capital requirements of its balance sheet, and to support M&A dealmaking. Zopa is set to snap up buy-now pay-later firm DivideBuy as it kicks off a dealmaking push following the funding round. Zopa did not disclose a price tag for the funding round but said it “cements” its unicorn status. A source close to the deal said Zopa’s post-money valuation increased through the round.

The UK was the most active European FinTech country in February 2023, with companies raising 38 deals, a 46% share of total deals. Germany was second with a 13.4% share of deals and France was third with an 8.5% share.

Blockchain and Crypto was the most active FinTech subsector in Europe during February 2023 despite the global drop in Cryptocurrencies which saw Bitcoin declining 70% from its peak in November 2021. This shows that VCs still have faith in the disruptive technology going forward.