Financial Technology Startup Highlights  – Q2 2018

Here is our Q2 2018 summary report on the financial technology startup sector. The following report includes a sector overview and recent activity.

To learn more about our complete financial technology report and research platform, visit us at www.venturescanner.com or contact info@venturescanner.com.

Payments-Related Fintech Categories Seeing Large Growth in Q2

Last quarter we determined that fintech funding is maturing. This quarter we are taking a closer look on our fintech research platform to examine funding by category. From this analysis, we conclude that payments-related categories are outperforming all other categories by a wide margin.

This conclusion comes from two important takeaways:

  • Consumer Payments leads the sector in Q2 funding
  • Consumer Payments also has the highest funding growth percentage

We’ll explain these takeaways with some graphics and discussions below.

Consumer Payments Leads Fintech in Q2 Funding

To start off, let’s look at fintech category funding in Q2.

Financial Technology Current Quarter Category Funding
Financial Technology Current Quarter Category Funding

The above graphic shows that Consumer Payments leads the sector in Q2 funding with $15B, with Payments Backend right behind at $14.7B. It’s noteworthy that these payments categories are roughly 13 times larger than the next category, Business Lending.

So we’ve witnessed how different fintech categories stack up in their Q2 funding. But how do these categories’ funding growth rates compare with one another? Let’s investigate that in the next section.

Consumer Payments Funding Grew the Fastest in Q2

The graph below shows the all-time funding in fintech categories with the quarterly funding and growth rates highlighted.

Financial Technology Total Category Funding
Financial Technology Total Category Funding

The line graph in the above graphic indicates that Consumer Payments and Payments Backend had the highest growth rates and more than doubled their funding in Q2.

Although the bar graph demonstrates that Consumer Lending leads in all-time funding with $29B, the two payments-related categories, Consumer Payments and Payments Backend, aren’t far behind with $28B and $27B, respectively.

Conclusion: Payments-Related Fintech Categories Saw Massive Growth Last Quarter

In summary, we have analyzed the fintech funding amounts in different fintech categories. We’ve discovered that Consumer Payments leads in Q2 funding and had the highest growth percentage, with Payments Backend in a close second place for both metrics. It’ll be interesting to see if any other fintech categories will see similarly large growth in the rest of 2018.

To learn more about our complete financial technology report and research platform, visit us at www.venturescanner.com or contact us at info@venturescanner.com.

Making Sense of the FinTech Startup Ecosystem

At this time, we are tracking 1,425 FinTech companies across 19 categories, with a combined funding amount of $30.37B. These are relatively new companies that either serve existing pieces of the financial system or develop alternatives to those pieces. It includes B2B and B2C companies.

See the breakdown in sector funding and the most updated market information at http://insights.venturescanner.com/venture-scanner-sector-maps/.

Fintech Map

Lending (Consumer): New ways for consumers to obtain personal loans. Includes peer-to-peer lending for education loans, housing loans, payday lending, and micro-financing. Also, includes companies that provide big data analytics and consumer credit scoring services.

Lending (Business): New ways for companies to raise debt financing. Includes small business loan underwriting, provision of working capital, peer-to-peer lending platforms, asset-based lines of credit (i.e. borrow against unpaid invoices), and micro-financing. Also, includes companies that provide big data risk analytics and business credit information.

Payments (Acquirer — Online/ Electronic): Payment companies centered around acquirers; provides online payment solutions for e-commerce merchants; includes online payment gateways, ACH, direct deposits, payments back-end for mobile apps.

Payments (Acquirer — Point-of-Sales): Payment companies centered around acquirers; provides physical payment solutions for brick-and-mortar businesses and organizations; includes mobile point-of-sales (POS) systems and POS innovations (e.g. QR code, palm scanners).

Payments (Issuer/ Consumer): Payment companies centered around issuers and consumers; includes mobile wallets, credit card aggregators, prepaid card innovations, and peer-to-peer payments.

Small Business/ Non-Profit Organization Tools: Tools that help small & medium businesses manage their finances — including tax, payroll, invoicing, and accounting tools. Also includes tools for non-profit organizations.

Personal Finance: New ways for consumers to manage their personal finances — including tools to track expenses, clear debt, and save money. Also includes tools that address wrongful credit card charges, tools that optimize for credit card rewards, and insurance comparison tools.

Retail Investment: New ways for the consumers to invest — including theme-based investments, crowdsourced investment expertise, unbiased algorithmic investment advice, and investment social networks.

Remittances: Companies that allow consumers to send money abroad easily and cheaply. Money can be sent in the form of cash or gift cards.

Equity Financing: News ways for private companies to raise capital in exchange for equity and for investors to participate in private securities markets — including crowdsourcing platforms and secondary markets.

Institutional Investment: New ways for wealth managers, hedge fund managers, and professional traders to manage their portfolios and optimize returns — including tools for stock sentiment analysis, alternative investment platforms, and algorithmic trading tools.

Consumer Banking: New ways for consumers to interface with banking services — including Internet-banking-only services and virtual credit cards.

Banking Infrastructure: Solutions that improve the operations of financial institutions — including API integration with banks, white-label mobile solutions, and big-data solutions.

Individualized Insurance: Companies that optimize insurance costs, such as comparison websites and technologies that allow for personalized quotes (such as Pay As You Drive automotive telematics).

Financial Research and Data: Information services that enable investors to make better investment decisions — including news, research, and data sources.

Security, Authentication, and Fraud: Includes companies that create products in the area of security, authentication (e.g. identify verification), fraud detection/prevention (e.g. payments fraud, loan fraud).

Crowdfunding (Non-Investment): Non-equity, non-lending/debt crowdfunding platforms for products, social causes, and creative projects. Also includes civic crowdfunding platforms and platforms that give backers a cut of royalty payments from product sales.

Financial Technology Investments: Venture capital funds, corporate venture funds, and accelerators focused on investing in financial technology startups.

Venture Scanner enables corporations to research, identify, and connect with the most innovative technologies and companies. We do this through a unique combination of our data, technology, and expert analysts. If you have any questions, reach out to info@venturescanner.com.

Which Financial Technology Category Is Most Mature?

Today we would like to introduce an infographic that breaks down our Financial Technology sector in order of median age. Banking Infrastructure currently has the highest median at 8 years while Crowdfunding has the lowest median at 3 years. Each category in our Financial Technology scan was created by our dedicated team of analysts who specialize in helping you understand the complex startup ecosystem. Additionally, every company included in the scan is handpicked by our team.

Median Age of FinTech Categories
Median Age of FinTech Categories

Venture Scanner enables corporations to research, identify, and connect with the most innovative technologies and companies. We do this through a unique combination of our data, technology, and expert analysts. If you have any questions, reach out toinfo@venturescanner.com.

FinTech Categories At a Glance

The following infographic gives a glance at some of the FinTech categories and the companies within them–including Lending, Payments, Personal Finance, Consumer Banking, and Equity Financing. We are currently tracking over 1153 companies in 18 categories across 57 countries, with a total of $19.8 Billion in funding. To see the full list of 1153 FinTech companies, contact us using the form on www.venturescanner.com.

Fintech infographic 6-23

Venture Scanner enables corporations to research, identify, and connect with the most innovative technologies and companies. We do this through a unique combination of our data, technology, and expert analysts. If you have any questions, reach out to info@venturescanner.com.