Wealthtech investment hits record in Q3

By Daniel Lanyon on 30th November 2017

Robo-Advice

Despite a fall in deal activity firms raised their highest ever investment levels in the disruptive wealth management market.

Wealthtech investment hits record in Q3

Despite a fall in deal activity firms raised their highest ever investment levels in the disruptive wealth management market.

 
 

Wealthtech companies globally raised $907m-worth of funding across 45 investments in the third quarter of the year, and 80 per cent rise year on year, according to consultants Fintech Global.

This stellar growth is largely due to a rise in the number of deals above $100m which increased from 1 to 4 between Q2 2017 and Q3 2017. China-based personal finance platform Feidee secured $200m from KKR & Co. in the largest funding round of the quarter. This equates to 22.1% of the total funding in Q3 2017.

Whilst the number of deals fell by 45.1 per cent to just 45 deals, the lowest value since Q1 2015., he decrease in deal activity combined with the increase in deals over $100m resulted in the average deal size tripling from $8.8m in Q2 2017 to $25.9m in Q3 2017.

READ MORE: What is WealthTech?

This trend is set to continue in 2017. WealthTech companies received $1.78bn in funding for the first three quarters of the year which equates to 82.1% of the total amount invested in 2016.

Half of the ten largest WealthTech deals in Asia between 2015 and 2017 were mega deals valued over $100m. Eight of these were completed in China, with the remaining two in Hong Kong.

The top 10 WealthTech deals in Q3 2017 account for almost 90% of the total funding for the quarter.

The top 10 deals in Q3 2017 raised nearly $800m in funding which accounts for 88.2% of the total amount invested in the quarter.

The largest deal of Q3 2017 was the previously mentioned $200m funding round raised by Feidee. Brazil-based digital finance company, Nubank, secured the second largest investment at $143.3m in a debt financing round led by Goldman Sachs and Fortress Investment Group.

Half of the top 10 WealthTech investments in Q3 2017 went to US-based companies, with the remaining five deals spread between companies in China, Brazil, Hong Kong, the UK and France.

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