Key European PayTech investment stats in Q3 2023:
• PayTech deal activity reached 17 transactions in Q3 2023, a decline of 61% from last year’s figures
• European PayTech companies raised a combined $191m in Q3 2023, a 89% drop from Q3 2022
• The UK was the most active PayTech country in Europe with seven deals in Q3 2023
European PayTech has seen a major drop in both deal activity and investment in Q3 2023 YoY. In Q3 2023, the number of PayTech deals plummeted by 61% compared to the same period last year, totalling only 17 transactions. In Q3 2023, European PayTech companies secured a collective funding of $191m, marking a significant 89% decrease compared to the same period last year. Although there have been drops across the whole FinTech market, PayTech investment has fallen more dramatically compared to other sectors. A reason for this could be a decrease in consumer spending, according to Forrester, in June 2023, UK consumer spending growth was 5% year over year, versus 9% in June 2022. This drop could put doubts into investors minds on the expected growth of payment companies going forward.
Curve, a banking platform that consolidates cards and accounts into one smart card and app, had the largest PayTech deal in Europe during Q3 2023, raising $71.3m (£58m) in their latest Series C extension funding round. The new funds will be used to improve the overall customer experience (Curve just recently rolled out its new app, which includes a marketplace of financial applets), expand its Flex offerings, and bring exciting new partnerships to the market. The Series C extension round saw participation from Britannia, IDC Ventures, Cercano Management (the venture arm of Microsoft co-founder Paul G. Allen’s estate), Cohen Circle, Outward VC and other existing shareholders. According to the app it also has new partnerships to bring to the market, and specifically mentioned one with a “payments giant” to be announced later this month. “This last raise, like any raise, brings with it renewed responsibility to our shareholders and our customers; to build a good product and an exciting business, by executing well,” Curve founder and CEO Shachar Bialick said.
The UK was home to the highest number of PayTech deals in Europe with seven funding rounds in Q3 2023, a 41% share of all transactions. Germany was second with four deals, a 23.5% share of deals and the remaining countries had one deal each.