Key RegTech investment stats in Q2 2024:
- Global RegTech funding recorded a second consecutive quarterly growth during Q2 as investments grew by 5%
- Deals over $100m increased by 44% from Q1 2024, which brought the average deal value for the quarter to $19.6m
- KarmaCheck secured the largest deal for the quarter via its Series B funding with $45m
In Q2 2024, the global RegTech sector experienced a notable decline in both deal activity and funding compared to the same period in 2023. A total of 102 transactions were completed during the quarter, representing a 54% drop compared to the 222 deals recorded in Q2 2023, and a further 29% decline from the 144 deals in Q1 2024. However, despite the reduction in deal numbers, funding increased to $2bn in Q2 2024, up 5% from $1.9bn in Q1 2024, though still 33% lower than the $3bn raised in Q2 2023.
If this trend continues, the projected number of deals for 2024 would be around 492 deals, a 33% decline from the 738 deals completed in 2023. In terms of funding, the year could close with approximately $7.8bn, a 35% decline from the $12bn raised in 2023, but showing relative stability compared to recent quarters.
Deals under $100m in Q2 2024 accounted for $890m, down 37.7% from $1.4bn in Q2 2023. Larger deals over $100m totalled $1.1bn in Q2 2024, representing a 29% drop from $1.6bn in Q2 2023 but a healthy 44% recovery from $782m in Q1 2024. The average deal value in Q2 2024 stood at $19.6m, up from $13.5m in Q2 2023, reflecting fewer but higher-value transactions.
KarmaCheck, a trailblazer in technology-driven background checks and credentialing, secured $45m in a Series B funding round, the largest deal during Q2, spearheaded by Parameter Ventures, with additional backing from PruVen Capital, Velvet Sea Ventures, GC1 Ventures, and NextView Ventures. KarmaCheck is renowned for its innovative approach to simplifying and enhancing the background check process. Founded in 2019 by Eric Ly, a LinkedIn co-founder, the company has consistently aimed to dismantle the barriers obstructing the path between talent and professional opportunities. Through its state-of-the-art technology platform, KarmaCheck has redefined the standards for background checks and credentialing services. The fresh capital will be utilised to further refine KarmaCheck’s proprietary technology, scale up service levels to accommodate more customers and candidates, and venture into new industry verticals.
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