By Aisling Finn on Wednesday 14 July 2021
The total invested in fintech firms is over a third (34 per cent) higher than in 2020
Given some of the rounds we’ve seen raised so far this year, this new data from Innovate Finance will come as no surprise.
So far, in the first half of 2021, fintechs have raised more than they did in the whole of 2020, $5.7bn compared to $4.3bn, an increase of over a third (34 per cent).
UK fintechs raised the $5.7bn across 317 deals, including 13 ‘mega rounds’ of over $100m, more than double the seven completed across 2020.
The massive jump in investment is largely down to the likes of Checkout.com ($450m), Klarna ($1bn), Starling Bank ($376m) and ClearScore ($200m) to name but a few of the 13 fintech firms to have raised $100m+ so far this year.
“This analysis clearly demonstrates that the appetite among international investors to fund high-growth, innovative firms has never been greater, and is a testament to the UK’s position as a world leader in fintech,” Janine Hirt, CEO of Innovate Finance, said.
“Fintech is one of the fastest-growing sectors of our economy and has a vital role to play in the UK’s economic and business recovery. To have secured record funding – in just six months – speaks to an enduring confidence in UK innovation, as well as our ability to build and scale world-class businesses.”
As it stands, the UK is second only to the US when it comes to fintech investment.
In the US, fintechs raised $26.7bn across 940 deals and the UK is still strides ahead of its other international competitors, like Brazil (40 deals worth $3bn), Germany (56 deals worth $2.5bn) and India (132 deals worth $2.2bn).
“It is hugely encouraging to see evidence of this resilience and growth, particularly in light of the uncertainty and challenges brought on by 2020. Both the flow of capital and a wide talent pool are essential to maintaining the sector’s strength, and we remain committed to supporting efforts in these vital areas,” Hirt added.
As well as record levels of funding, the UK is (finally) experiencing its long-promised fintech IPO boom.
In the last few months, we’ve seen PensionBee and Wise list on the London Stock Exchange, LendInvest reignite its IPO dream, filing its paperwork to list on AIM and just yesterday London-based VC firm Forward Partners announced its intention to list on AIM too.