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Investment into female founded fintechs ‘drops 66%’

Data reveals investment into female-founded fintechs dropped dramatically year-on-year in the first quarter of 2022, in contrast to healthy overall levels of performance.

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Janine Hirt/Innovate Finance.

Investment into fintechs with either a female founder or co-founder fell 66 per cent between H1 2021 and H1 2022, according to data compiled by Innovate Finance and gathered by PitchBook.

In the first half of 2022, £310m was invested into UK female-led fintechs across 20 deals, compared to £0.91bn across 32 deals in the first half of 2021.

Investments into UK female-led fintechs also fell proportionately, representing only 4 per cent of the total investments in UK fintechs in the first half of 2022, down from 15 per cent in the first half of 2021.

Last year, a total of £1.32bn was invested into UK female-led FinTechs across 55 deals, which Innovate Finance said indicates that there was already a slow down in investment into female-led Fintechs in the second half of 2021.

Two deals, Starling Bank’s £272m Series D and Generation Home’s £373m Series A, together accounted for £748m of that £1.32bn and both deals occurred in the first half of 2021.

Starling’s 2021 raise, led by Fidelity Management & Research Company,  took its valuation up to £1.1bn, almost matching the £1.25bn valuation rival Monzo held at the time.

The news comes despite fintech funding remaining strong in the UK overall.

The UK fintech sector grew 24 per cent year-on-year in the first six months of 2022, despite the global investment scene cooling down.

Data, also compiled by Innovate Finance, found UK fintechs raised a total of £7.6bn in funding, beating out the rest of Europe and only falling behind the £20.8bn raised by US firms.

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