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intelligence platform.
CB Insights software lets you predict, discuss,
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T R U S T E D B Y T H E W O R L D ' S L E A D I N G C O M P A N I E S
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and interesting companies that might signal a shift in
technology or require us to reallocate resources."
Beti Cung, Corporate Strategy, Microsoft
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LENDING
BLOCKCHAIN/
CRYPTO
REGTECH
PERSONAL
FINANCE
PAYMENTS/
BILLING
MONEY
TRANSFER/
REMITTANCES
WEALTH
MANAGEMENT
CAPITAL
MARKETS
MORTGAGE/
REAL ESTATE
INSURANCE
GLOBAL FINTECH
REPORT Q2 2018
Marketplace lending & alternative
underwriting platforms
Payments processing, card developers,
& subscription billing software tools
Tools to manage bills and track
personal and/or credit accounts
Audit, risk, and regulatory
compliance software
Companies leveraging blockchain
technologies for financial services
Companies selling insurance digitally or providing
data analytics and software for (re)insurers
Sales & trading, analysis, and infrastructure
tools for financial institutions
Investment and wealth management
platforms and analytics tools
International money transfer
and tracking software
Mortgage lending, digitization,
and financing platforms
WHAT THIS REPORT C OVERS
5
H1'18 saw 46 fintech M&A and IPO exits: As the strongest six-month
period for fintech exits to date, H1 saw former unicorns GreenSky and
Adyen go public and iZettle get acquired for $2.2B, 2x its target IPO price.
Quarterly record for fintech mega-rounds as Asia beats US for first
time: Asia took the top spot with 7 mega-rounds, beating the US for the
first time.
Early signs of fintech investment spreading to frontier markets: In
Africa, VC-backed fintech companies in Q2'18 raised $63M across seven
investments, more funding than the last four years combined.
29 fintech unicorns valued at $84.4B: Q2'18 saw five new unicorns births,
bringing up the total VC-backed unicorn count to 29 worth a combined $84.4B.
Ribbit Capital is the most active fintech unicorn investor, followed by QED
Investors.
Note: Report focuses on all equity rounds to VC-backed fintech companies. This report does not cover
companies funded solely by angels, private equity firms, or any debt, secondary, or line of credit
transactions. All data is sourced from CB Insights.
Summary of findings
Ant Financial's $14B boosts Q2 funding to record $20B: In Q2'18, VC-
backed fintech companies raised $20.3B across 383 deals globallynew
quarterly records in funding and deals. Excluding Ant's record financing,
VC-backed fintech funding still hit a quarterly record at $6.3B, up from
$5.6B in Q1'18.
Asia could be on track to surpass the US in fintech deals: Asia set a
quarterly record with 133 deals, driven by a spike in early-stage deals and
a 94% increase in deals in China, which saw 68 deals worth $15.4B. In the
US, early-stage deals as percentage of total deals fell to a five-quarter
low.
Europe saw Q2'18 deals rebound with surge in early-stage deals: The
boost in early-stage deals helps explain a dip in funding. Despite a 20%
funding decrease from Q1, funding for H1'18 beat H1'17. Europe also
minted a unicorn (Revolut) and had two largest exits to date.
US remains top market with five-year funding record: Q2'18 saw a slight
dip in deals from Q1'18's record, but it was still a quarterly high for
funding to US-based fintech companies on the back of six mega-round
investments which minted two unicorns (Circle and Tradeshift).
6
Contents
8
Q2'18 Financing Trends
Annual Deals & Dollars
Regional Trends
Fintech Unicorns
63
6 9
Incumbent Fintech Investing Update
Appendix:
Major markets financing trends
M&A and IPO trends
21
Top Deals and Top Investors
Q2' 2018 Top VC-Backed Fintech Deals
Most Active Fintech Investors Q2'17-Q2'18
Q2'18 Sector Trends
26
7
$20.34 BILLION
383 DEALS
G L O B A L F I N T E C H V C - B A C K E D E Q U I T Y F U N D I N G I N Q 2 ' 1 8 :
A C R O S S
8
Global fintech deals are on pace for a record year
Annual VC-backed global fintech deals and financing, 2013 2018 YTD (Q2'18), ($B)
1,476
$3.8
$7.9
$15.3
$18.7
$16.7
$26
588
796
984
1,086
1,216
732
2013
2014
2015
2016
2017
2018
9
$1,131 $918 $1,108 $1,701 $1,794 $1,279 $3,172 $2,573 $4,601 $6,004 $2,136 $5,259 $8,269 $2,782 $2,376 $2,975 $5,518 $4,001 $4,251 $5,628 $20,335 135
161
169
175
183
210
228
219
257
278
230
304
271
258
253
292
325
303
296
349
383
Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18
Q2'18 sees a new quarterly record for global VC-
backed fintech deals & funding
10
$1,131 $918 $1,108 $1,701 $1,794 $1,279 $3,172 $2,573 $4,601 $6,004 $2,136 $5,259 $2,782 $2,376 $2,975 $5,518 $4,001 $4,251 $5,628 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18
Ant Financial's record investment accounted for
69% of Q2'18 fintech funding
$4,500$14,000
11
$1,131 $918 $1,108 $1,701 $1,794 $1,279 $3,172 $2,573 $4,601 $6,004 $2,136 $5,259 $3,769 $2,782 $2,376 $2,975 $5,518 $4,001 $4,251 $5,628 $6,335 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18
Excluding Ant Financial's $14B round, Q2'18 still a
record high
*Ant Financials' $14B round in Q2'18 was excluded from the chart represented on this slide for illustrative purposes
*
*
12
130
136
122
169
158
91
90
80
94
133
72
68
77
69
72
3
1
3
1
7
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
Africa sees first jump in fintech deals and Asia
posts record quarter in Q2'18
Global VC-backed fintech deals by continent, Q2'17 Q2'18
Europe
Asia
North America
-7% YOY
Africa
+133% YOY
+46% YOY
+4% YOY
13
$2,122
$2,103
$2,536
$2,230
$3,296
$2,801
$1,379
$699
$2,042
$2,070
$522
$496
$903
$1,065
$852
$63
$41
$12
$103
$271
$30
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
South America saw the largest fintech funding dip
Global VC-backed fintech funding by continent, Q2'17 Q2'18, ($M) (*Ant Financial excluded)
*Ant Financials' $14B round in Q2'18 was excluded from the chart represented on this slide for illustrative purposes
South America
-89% QOQ
Africa
Europe
-20% QOQ
Asia
+1.4%* QOQ
North America
48% QOQ
99.6% QOQ
14
Early-stage deals were strongest in Asia & Europe
Quarterly deal share by stage to global VC-backed fintech companies, Q2'17 Q2'18
Mid-Stage
Early-Stage
Late-Stage
Other
60%
60%
61%
55%
56%
17%
20%
21%
21%
20%
7%
9%
9%
9%
7%
16%
11%
8%
16%
17%
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
15
74
69
72
95
79
63
60
47
50
78
38
45
50
36
44
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
Asia nears the US in early-stage deals
Quarterly Seed and Series A deals to VC-backed fintech startups, Q2'17 Q2'18
I N V E S T O R S A R E L O O K I N G O U T S I D E O F T H E U S F O R E A R L Y - S T A G E F I N T E C H O P P O R T U N I T I E S
Europe
Asia
North America
-17% YOY
+46% YOY
+22% YOY
16
Asia beats US with 7 fintech mega-rounds
Q2'18: 14 mega-rounds ($100M+), worth a total $16.83B
I N V E S T O R S A R E P O U R I N G R E C O R D F U N D I N G R O U N D S I N T O A S I A O V E R T H E U S & E U R O P E
6
6
7
4
6
4
5
1
4
7
1
1
4
1
1
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
North America
Asia
Europe
South America
17
29 FINTECH UNICORNS
$84.4 BILLION
G L O B A L L Y T H E R E A R E
V A L U E D , I N A G G R E G A T E , A T
18
CHINA
UNITED KINGDOM
INDIA
SWEDEN
EUROPE
ASIA
29 fintech unicorns valued at $84.4B
Global VC-backed fintech companies with a private market valuation of $1B+ (as of Q2'18)
$1.79B
$5.3B
$1B
$1.46B Valuation
$1B
$18.5B
$1B
$1.6B Valuation
$2.5B
$1B
$1.56B
$1.24B
$1B
$1.2B
$9.2B
$1B
$1.9B
$2B (as of Q2'15)
$3.2B
$4.5B
$1B Valuation
$4B
$1B
$1B - $2B
BRAZIL
SOUTH AMERICA
UNITED STATES
NORTH AMERICA
$1.1B
$1.7B
$3B Valuation
$1.2-$1.6B
$7B
19
CHINA
SWEDEN
Q2'18 sees 5 fintech unicorn births
Global VC-backed fintech companies with a private market valuation of $1B+ (as of Q2'18)
$1.79B
$5.3B
$1B
$1.46B Valuation
$1B
$18.5B
$1.6B Valuation
$2.5B
$1B
$1.56B
$1.24B
$1B
$1.2B
$9.2B
$1B
$1.9B
$2B (as of Q2'15)
$3.2B
$4.5B
$4B
$1B
$1B - $2B
BRAZIL
SOUTH AMERICA
$1.1B
$7B
$1B
$1B Valuation
$1.7B
$3B Valuation
$1.2-$1.6B
EUROPE
NORTH AMERICA
INDIA
ASIA
UNITED KINGDOM
UNITED STATES
20
Fintech unicorn hunters
Investors ranked by the number of fintech unicorns in their portfolio from 2009 Q2'18
10
6
5
5
5
5
4
4
4
4
Ribbit Capital
QED Investors
Andreessen
Horowitz
SV Angel
DST Global
Institutional
Venture Partners
capitalG
Founders Fund
Index Ventures Sequoia Capital
#AhaCBI
Top investors
& deals
22
The most active fintech VCs from Q2'17 Q2'18
By unique fintech company investments (new or follow-on)
Rank
Investor
Select Q2'17 Q2'18 Fintech Investments
1
2
2
4
23
Rank
Investor
Select Q2'17 Q2'18 Fintech Investments
5
5
7
8
The most active fintech VCs from Q2'17 Q2'18
By unique fintech company investments (new or follow-on)
24
Company
Deal Date //
Amount
Total Disclosed
Funding (M)
Select Investors
Description
May'18 // $14,000M
$19,145M
($150B Valuation)
Silver Lake Partners, General Atlantic, T.
Rowe Price, Temasek Holdings, Sequoia
Capital China, Warburg Pincus, & others
China-based internet giant that provides a suite of
financial services spanning payments, insurance,
credit, wealth management, and others, through
various subsidiaries including Alipay & Yu'e Bao
Jun'18 // $392M
$569M
($1.2-$1.6B Valuation)
Venrock, Goldman Sachs, GSV
B2B data analytics suite of modular desktop and
API applications that leverage social media to
detect events, consumer signals, and alerts
May'18 // $363M
$539M
($5.6B Valuation)
capitalG, DST Global, ICONIQ Capital,
Kleiner Perkins Caufield & Byers, Sequoia
Capital
B2C digital brokerage and financial services
platform that lets users invest in U.S. stocks,
ETFs, options, and cryptocurrencies
Jun'18 // $359M
$536M Geo-Jade Petroleum Corporation,
Shunwei Capital Partners
Web-based investment portal that provides
various debt-backed investments products for
individual and SMB investors
May'18 // $250M
$455M
($1.1B Valuation)
Goldman Sachs Principal Strategic
Investments, HSBC,GP BullHound
Sidecar, Gray Swan, H14
A procure-to-pay supply chain management
platform for SMBs and enterprises
Top 10 global fintech deals in Q2'18
The top 10 deals to VC-backed fintech companies were all mega-rounds ($100M+) and half were in Asia
25
Company
Deal Date //
Amount
Total Disclosed
Funding (M)
Select Investors
Description
Apr'18 // $250M
$336M
($1.7B Valuation)
DST Global, Index Ventures, Ribbit
Capital, Rocket Internet
UK-based "challenger bank" that launched a
mobile payments and "top-off" card and has been
rapidly expanding into new services like crypto
investing and into markets in the EU and the US
Jun'18 // $245M
$19,145M
($150B Valuation)
China Pacific Insurance
China-based internet giant that provides a suite of
financial services spanning payments, insurance,
credit, wealth management, and others, through
various subsidiaries including Alipay & Yu'e Bao
Jun'18 // $200M
$347M
($1B Valuation)
Softbank Capital
India-based online comparison, quotes, and
recommendation tool for life & general insurance,
loans, and credit cards that partners with issuing
financial institutions
May'18 // $178M
$232M Undisclosed Investors*
(*not a token sale)
Cryptocurrency wallet that provides investors with
Bitcoin portfolio management, corporate treasury,
and enterprise enablement
Apr'18 // $159M
$263M China Reform Holdings, Sequoia Capital
China
B2B alternative data platform for bank and
insurers to provide credit services and other
financial services and serve as a CRM for
outstanding loans
Top 10 global fintech deals in Q2'18 (continued)
4 of the top 10 deals to VC-backed fintech companies created new unicorns
26
SMB
FINTECH
ALTERNATIVE
LENDING
INSURANCE
PAYMENTS/
BILLING
PERSONAL
FINANCE
WEALTH
MANAGEMENT
BLOCKCHAIN
CAPITAL
MARKETS
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
27
SMB
FINTECH
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
28
SMB Fintech in North America & Europe
*The map is not meant to be exhaustive of companies in the space
SMBs were a key
focus of deals
across the fintech
ecosystem
In Q2'18, many fintech
startups that raised funding
are looking to solve SMBs
needs beyond obtaining
loans & financing
Small businesses remain
underserved by established
players that target bigger
corporates.
29
Tradeshift is a procure-to-pay supply chain
management platform for SMBs and
enterprises.
Tradeshift's suite of applications include
Pay (for dynamic discounting and supply
chain financing), Buy (for marketplace
procurement), and Apps (for general supply
chain digitization). Tradeshift integrates
with many popular SMB apps.
S H I F T I N G T R A D E F I N A N C E R I S K A W A Y F R O M S M B S
Last Funding
$250M Series E // May'18
S E L E C T B A N K I N V E S T O R S
Valuation $1.1B
S E L E C T I N T E G R A T I O N S
30
Banking on startups as the next SMB battle ground
Select Q2'18 SMB fintech investments in the US:
Divvy is a B2B payments & expense
platform for SMBs that issues virtual &
physical corporate credit cards (through
Mastercard).
Allocations to the digital & physical cards
are "divvy'ed" out by the employer through a
central app that that automatically captures
transactions, categorizes purchase, and
automates expense reporting.
Last Funding
$10.5M Series A // Utah
Select Investors
Pelion Venture Partners
Brex is a B2B financial services company
focused on startups. Brex's core products
include a credit card and a digital expense
management & reporting app.
Brex partners with Visa & Sutton Bank to
issue the cards and accounts and does
KYC and underwriting in-house.
Last Funding
$50M Series B // San Francisco
Select Investors
Ribbit Capital, Y Combinator, Yuri
Milner, Max Levchin, Peter Thiel
B
31
Select Q2'18 investments:
Banking on startups as the next SMB battle ground
Open provides banking services to
startups and entrepreneurs. Open offers
a digital banking platform, business
spend card, and bank account that can
make and receive payments.
Open integrates with other business
finance systems & popular SMB apps.
Last Funding
$2.4M Seed B // India
Select Investors
ISME ACE, Recruit Strategic Partners,
Unicorn India Ventures
Pleo offers a prepaid card through Mastercard for
employers to allocate and reimburse employees.
The cards connect to Pleo's app that automatically
categorizes expenses, captures receipts, and tracks
expenses.
Pleo partners with 1,700 companies and integrates
popular SMB accounting and finance platforms.
Last Funding
$16M Seed A // Denmark
Select Investors
Creandum, Founders, Kinnevik, Seedcamp
Aprila Bank is a digital bank targeting
invoice financing for SMBs & entrepreneurs.
Aprila cuts down the credit approval
process and requires less transaction
history than traditional banks.
In April'18, Aprila integrated with Tripletex's
accounting systems to offer liquidity and
working capital to Tripletex's 30,000 SMBs.
Last Funding
$21M Unattributed // Norway
Select Investors
Alliance Venture, Arts Alliance, FJ Labs
+
32
ALTERNATIVE
LENDING
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
33
Deals to alternative lending startups see uptick but
still on pace for a new funding low
Global alternative lending VC-backed financing trends, Q2'17 Q2'18, ($M)
$805
$1,214
$1,045
$840
$639
40
41
34
33
38
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
34
Profitable GreenSky 'bears' market volatility
Source: CB Insights public market data
T H E G R A S S S T I L L I S N ' T G R E E N E R O N T H E P U B L I C S I D E F O R L E N D I N G
Stock Price ($)
$1.1B Market Cap
GSKY:$19.01 (7/13/18)
IPO Details

Offering: 38M shares

Price: $23 per share

Total raised: $874M

Analysts stick to "outperform" stock rating
35
Lending in India shifts from consumer to SMBs
VC-backed lending deals in Asia move out of China to developing nations in Q2'18
Q2'18 India Alternative Lending:

6 deals worth $53.6M
All focused on SMBs

5 were early-stage deals
Amazon lead the top deal to
Capital Float, a $22M Series C-II
Amazon is targeting merchant
lending to grow in India
36
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
INSURANCE
37
Insurance tech deals and funding dip in Q2'18
Global VC-backed insurance tech financing trends, Q2'17 Q2'18, ($M)
$615
$240
$532
$662
$468
43
32
36
43
37
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
38
Europe sees more early-stage insurance tech deals
Q2'18 saw 8 insurtech deals worth $192M in Europe, 6 were early-stage deals
39
Startups look to change the life insurance buying
experience in the US
Select H1'18 Life Insurtech deals
Focus: Term life insurance
Coverage: Up to $8M
(Re)insurance partners:
Hannover Re, Fidelity Security
H1'18 Funding: $40M Series B
Select Investors: RRE,
Canaan Partners, Allianz Life
Ventures, Northwestern
Mutual Future Ventures
Focus: Term life insurance
Coverage: Up to $10M
(Re)insurance partners:
Assurity, Munich Re, RGAx
H1'18 Funding: $11.5M Series A
Select Investors: Sequoia
Capital, Downey Ventures,
Roc Nation, Durant Company
Focus: Accidental death and
term life insurance
Coverage: Up to $5M
(Re)insurance partners:
Vantis Life, RGAx
H1'18 Funding: $10M Series A
Select Investors: Bessemer
Venture Partners
Focus: Term life insurance
Coverage: Up to $500K
(Re)insurance partners: North
American Company for Life &
Health, Munich Re
H1'18 Funding: $15M Series A
Select Investors: Valar
Ventures, Core Innovation
Capital, NEA
40
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
PAYMENTS/
BILLING
41
Adyen makes record public debut in Europe
Netherlands-based payments processor Adyen saw shares jump 98% is 1st day of trading
I N S U R G E N T P A Y M E N T P R O V I D E R S W A N T T H E I N D U S T R Y T O ' S T A R T O V E R A G A I N '
42
PayPal's $3B acquisition spree
*Note: PayPal also acquired Simility & Jetlore in Q2'18; both are non-fintech companies.
W H I L E C O M P E T I T I O N F R O M P A Y M E N T S I N C U M B E N T S H E A T S U P
Recent deals by PayPal highlight their focus on in-
store retail and marketplace enablement.
MAY 2018
MAY 2018
JUNE 2018
Corporate minority in India-based
Pine Labs, a cloud-based unified
payments interface (UPI) & PoS
Acquisition of iZettle for $2.2B for
their in-store PoS technology
operating in 50K business in
Europe, as well as Brazil & Mexico
Acquisition of HyperWallet, a
payout network to pay earnings,
commissions, or merchants
($400M valuation)
Jul'18 // $104.5B Market Cap
43
Payment networks look to grow partnerships and
secure a foothold in emerging markets
Focus: Contactless payments hardware and software provider that
can be integrated at both merchant & customer interaction points
Key Product: PoS hardware, card readers, mobile bank & wallet
Numbers: 50M consumers, 25,000 Retail Pods in India
Jun'18 // $8M Series A
Select Investors: Mastercard, Amazon
Focus: Digital financial services & payments intermediary
Key Product: Digital & card-not-present payments processor
Numbers: 6.6M MAU, 480M digital transactions annually, 400K
merchants supported, across 6 LatAm countries
Jun'18 // $7M Series A
Select Investors: Visa
44
And for next-gen credit & debit cards
Select startups & respective payments network partner
VS.
45
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
PERSONAL
FINANCE
46
Fintech business lines are blurring as bank
accounts become the new battleground
U N U S U A L S U S P E C T S A R E L O O K I N G T O B A N K A C C O U N T P R O D U C T S
47
Acorns grows to 3.7M customers & $1B in AUM
A C O R N S I S A C T I V E L Y P U R S U I N G O M N I - C H A N N E L S T R A T E G Y T O D I V E R S I F Y O F F E R I N G
A C O R N S S P E N D
A C O R N S G R O W
Debit Cards
175,000 signups since July'18
Target launch Nov'18
Retirement Savings
350,000 signups since April'18
May'18 // $50M Series E
Select Investors:
Blackrock, Bain, Nyca, Sound Ventures,
Point 72, Paypal, Greycroft, e.Ventures
Q2'18 announcements:
Acorns Grow, a retirement savings account
through acquisition company Vault launched
IRA, Roth IRA, and SEP retirement accounts
Acorns Spend, a debit cards that rewards
spending with investment contributions
Acorns is exploring adding more active
investments and potential 401(k) partners
S E L E C T P A R T N E R S H I P S
Acquired by GS Q2'18
May'18
Nov'17
Feb'18
48
Digital banking startups in US add funding
US-based startups raise funding in Q2'18 to build products as European challengers look stateside.
Last Funding
$29.7M Series B // New York (Stockholm)
Select Investors
Anthemis Group, Entre Capital, SEB Private Equity, Northzone Ventures
Qapital was first a PFM app focused on goals-
based saving that uses IFTTT (If This Then
That) recipes to prompt behavioral changes to
achieve savings goals.
Now, they offer Visa debit cards & look to
launch robo-investment in 2019.
In April'18 they reported having 420K users
that have saved $500M.
Crosslink Capital, Forerunner Ventures, Menlo Ventures,
Northwestern Mutual Capital, Omidyar Network, Homebrew
Last Funding
$70M Series C // San Francisco
Valuation $500M
Chime is a mobile banking app that
provides a checking account-like service
through a partnership with Bancorp,
debit cards through Visa, and optional
round ups Savings Accounts.
In May'18, Chime crossed 1M accounts.
Select Investors
49
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
WEALTH
MANAGEMENT
50
Wealth tech deals on track to surpass 2017
Global wealth tech VC-backed fintech financing trends, Q2'17 Q2'18, ($M)
$551
$321
$211
$567
$758
27
27
23
34
28
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
51
Early startups gained an edge by undercutting
incumbents with competitive & transparent fees
VS.
Management Fees
0.25%; first $10,000
is managed free
0.25% to 0.40%,
depending on plan
Trading Fees
$0
$0
Management Fees
0.35%
0.25% to 0.50%
Trading Fees
$6.95
$6.95
$4.95
$4.95
52
Starting in August, investors using Vanguard's online brokerage will be able to trade ETFs on a
commission-free basis. Vanguard supports nearly 1,800 ETFs of the roughly 2,000 in the market
from 100 ETF providers including from rivals iShares, Schwab and State Street Global Advisor.
Why does it matter?: Millennials love ETFs more so than older investors and with so much
interest and competition from fintech in ETFs, Vanguard, Schwab, & Fidelity are slashing fees to
compete and acquire millennial customers.
Vanguard Group eliminates trading fees
on almost all ETFs including funds
from most of its rivals
July 2, 2018
53
Advisor tech focuses on AUM over millennials
Select Q2'18 investments:
Focus: Risk management, portfolio tracking, and
advisory platform including Stratifi's PRISM risk rating.
Stratifi integrates with several major brokerages
including TD & Fidelity.
Q2'18 Funding: $7M Series A
Select Investors: Khosla Ventures, Anthemis Group
Focus: Institutional multi-asset class portfolio
management and reporting solution for pension,
endowments, foundations, OCIOs, and family offices.
In May'18 Solovis partnered AcordIQ to expand PE services
Q2'18 Funding: $8M Series A
Select Investors: Edison Partners, FINTOP Capital
54
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
BLOCKCHAIN
55
Pure-play ICOs still losing funding momentum
Sources: CB Insights, TokenData.
$648
$460
$329
$775
$857
$816
$1,223
$1,675
$1,214
$701
$580
$994
$4,234
$850
$850
35
30
62
98
148
133
215
175
120
169
129
106
10
Jun-17
Jul-17
Aug-17
Sep-17
Oct-17
Nov-17
Dec-17
Jan-18
Feb-18
Mar-18
Apr-18
May-18
Jun-18
Disclosed funding of completed ICOs (and Telegram's private sale). June 2017 June 2018 (YTD)
Total Completed
ICOs
Total ICO Disclosed
Raised ($M)
Telegram Private
Sale ($M)
EOS ($M)
(year-long ICO)
56
Blockchain fintech hits 5-quarter high in Q2'18
Global VC-backed blockchain fintech financing trends, Q2'17 Q2'18, ($M)
Note: Blockchain investments outside of financial services-related applications are not included in this data
$188
$158
$300
$179
$633
18
21
28
37
51
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
57
M&A activity in crypto space heats up
May'18 // $165M Series D
Select Investors:
Accel, Breyer Capital, General Catalyst,
Blockchain Capital, Digital Currency Group

In Feb'18 Circle acquired crypto exchange
Poloniex ($400M valuation)

In Jan'18 the OTC crypto trading business'
monthly trading volume was ~$2B
$3.2B Valuation
H1'18 Acquisitions
Acquires
In June, Stellar, a blockchain protocol for
building financial products, reportedly
acquired San Francisco-based Chain for
$500M paid in Stellar's digital currency XLM.
Chain provides blockchain technology for the
financial industry and had previously raised
more than $43M from investors including
Khosla Ventures, RRE Ventures, Pantera
Capital, Citi Ventures, and Nasdaq.
In addition to launching a venture arm, Coinbase
made 7 acquisitions in H1'18 including Keystone
Capital, a FINRA-registered broker-dealer that
operates as an alternative trading system. The
acquisition will allow Coinbase to sell cryptocurrency
tokens that are deemed securities.
H1'18 acquisitions:
Acquires
Q2'18 announcements:
58
Fintech insurgents look to tap into crypto's viral
growth
*Rounds not included in blockchain Q2'18 funding total
B L U R R E D L I N E S
1
3
1
1
17-Dec
18-Jan
Users before crypto
Users added since crypto
Date of crypto
feature launch:
4M
2M
May'18 // $363M* Series D
Select Investors:
DST, Index Ventures
Q2'18 announcements:
Grew 1M customers following crypto
exchange launch
Applied for BitLicense to set up NY
operations and is in 17 other states

In July'18 they added Litecoin, Dogecoin,
and Bitcoin Cash
$5.6B Valuation
Apr'18 // $250M* Series C
Select Investors:
DST, Index Ventures, Ribbit Capital,
Kleiner Perkins, capitalG
Q2'18 announcements:
Added 1M users with crypto launch
Broke even & grew headcount
Announced plans to add
commission-free stock trading
$1.7B Valuation
59
MACROS SECTOR
TRENDS
G L O B AL V C - B AC KED
F IN T E C H Q 2 ' 1 8
CAPITAL
MARKETS
60
$872
$675
$555
$1,131
$1,569
51
47
44
60
42
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
Capital markets tech funding grows, but deals
drop to five-quarter low
Global capital markets tech VC-backed fintech financing trends, Q2'17 Q2'18, ($M)
61
Dataminr is a B2B data analytics suite of
modular desktop and API applications that
leverage social media and public market data
sets to detect events, consumer signals, and
alert customers.
Dataminr for Finance is used by hedge funds
and investment banks to act on market
information and gain context from
nontraditional sources.
T H E F I R S T A L T E R N A T I V E D A T A U N I C O R N F O R F R O N T O F F I C E S A L E S A N D T R A D I N G
Last Funding
$392M Series E // Jun'18
S E L E C T F I N S E R V I C E S
I N V E S T O R S
Valuation $1.2 - $1.6B
62
Institutional-grade crypto vehicles target the street
Focus: Institutional clearing & trading platform for digital currency
swaps and options contracts.
Key Product: Bitcoin savings accounts that earns interest through
"call overwrites" on options (pictured above).
Numbers: $7.5M weekly trade volume, 700 swaps and options
contracts, 90 individual & institutional traders.
Apr'18 // $8.37M Series A
Select Investors:
FundersClub, Lightspeed, Google
Focus: Trade finance platform utilizing open-source
blockchain that today offers receivables discounting,
factoring, and payment commitment.
Key Product: Marco Polo, a platform for open account trade
that was developed with R3 and 10 international banks.
Jun'18 // $16M Seed
Select Investors:
BNP Paribas, ING Ventures
63
I N V E S T O R S P O T L I G H T :
Incumbent
Fintech Investing
Update
64
Top US banks make strategic
bets that align with core
initiatives
In Q2'18, Goldman Sachs invested $40M in
Series E financing to customized payment
card company Marqeta. A partnership could
allow Marcus to offer an Affirm-style POS
lending service.
JP Morgan participated in a $54M Series E
investment in Q2'18 to payments hardware
provider TouchBistro. The two partnered as
part of the deal, suggesting Chase Pay is
looking to grow its retail presence.
65
Top US banks make
strategic bets that
align with core
initiatives
Goldman focuses building out
retail banking arm Marcus.
JP Morgan remains focused on
payments and recently launched
their digital bank app Finn.
In H1'18 both Goldman Sachs
and JP Morgan saw Kensho exit
their portfolios. The company
was acquired by S&P at a
reported $550M valuation.
8
R E T A I L
B A N K I N G
5
P A Y M E N T S
VS.
66
European banks keep
up investing pace in
Q2'18 and see big exit
In Q2'18, Santander was among
one of the investors in iZettle
which was acquired by Paypal for
$2.2B.
Santander and HSBC have both
invested in recent unicorn
Tradeshift.
67
European banks are
challenging back
In H1'18, competition between
high street banks and well-funded
challengers continued to heat up.
While incumbents look to boost
their digital capabilities,
challenger banks are growing
market share and their global
footprint.
Fresh off mega-round ($100M+)
investments in H1'18, N26 and
Revolut continued to build out
their US operations.
VS.
1 M C L I E N T S
2 M C L I E N T S
7 5 0 K C L I E N T S
Santander latest traditional player
to open digital bank
May 15, 2018 |
68
Top banks continue to pick off fintechs in Q2'18
Fintech acquisitions between 2013 Q2'18
April'18 Goldman closed its' acquisition
of Clarity Money, adding a potential 1M
customers to its digital finance unit
Marcus.
69
VC-backed fintech
regional trends
A P P E N D I X Q 2 ' 1 8 :
70
$16.07 BILLION
133 DEALS
A S I A F I N T E C H V C - B A C K E D E Q U I T Y F U N D I N G I N Q 2 ' 1 8 :
A C R O S S
71
Asia sees record for fintech deals and funding
Deals to VC-backed fintech companies in Asia grew 41% & funding was flat quarter-over-quarter
$2.8
$1.4
$0.7
$2
$2
91
90
80
94
133
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
$14
Series C
($15B Valuation)
72
$3.2 BILLION
146 DEALS
U S F I N T E C H V C - B A C K E D E Q U I T Y F U N D I N G I N Q 2 ' 1 8 :
A C R O S S
73
$2.1
$2.0
$2.3
$2.1
$3.2
117
125
113
157
146
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
Amount ($B)
Deals
US fintech funding hit a 5-quarter high in Q2'18
US VC-backed fintech financing trends, Q2'17 Q2'18, ($M)
US financing saw a
boost from 6
mega-rounds worth
$1.39B
After a dip in Q1'18, funding
in the US came roaring back
and topped a new quarterly
record with $3.2B.
The US saw Dataminr,
Tradeshift, & Circle join the
unicorn club and GreenSky
exit in Q2'18
Early-stage deals also hit a
new record raising $532M
across 72 deals.
74
$852 MILLION
72 DEALS
E U R O P E F I N T E C H V C - B A C K E D E Q U I T Y F U N D I N G I N Q 2 ' 1 8 :
A C R O S S
75
$522
$496
$903
$1,065
$852
72
68
77
69
72
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
Despite the dip in funding, deals in Europe jumped
driven by a fresh crop of early-stage fintechs
76
CVC participation Europe fintech hit a 5-quarter high
CVC participation in Europe VC-backed fintech, Q2'17 Q2'18, ($M)
CVC activity in
European fintech
hits quarterly high
Corporates and their venture
arms (CVCs) participated in
26 fintech investments worth
$343M in funding in Q2'18.
In particular, Allianz X has
been active in large fintech
deals to European startups
including MoneyFarm, N26,
and Simplesurance in H1'18.
32%
26%
24%
31%
23%
36%
68%
74%
76%
69%
77%
64%
Q1'17
Q2'17
Q3'17
Q4'17
Q1'18
Q2'18
Corp / CVC Participation
Other Investors
#AhaCBI
Q2'18 Exits:
M&A + IPOs
78
$1.9B
CHINA
INDIA
SWEDEN
ASIA
IPOs in Q2'18
Global VC-backed fintech companies with a private market valuation of $1B+ as of Q1'2018
$1.79B
$1.3B
$1B Valuation
$1.46B
$1B
$18.5B
$7B
$1.6B Valuation
$2.5B
$1.56B
$1.24B
$1B
$1.2B
$9.2B
$1B
$2B (as of Q2'15)
$3.2B
$4.5B
$4B
$1B
$1B - $2B
BRAZIL
SOUTH AMERICA
$1.1B Valuation
$3.6B
UNITED STATES
UNITED KINGDOM
NETHERLANDS
EUROPE
$2.3B
$1B
NORTH AMERICA
GreenSky stock rises after several analysts
initiate coverage with bullish ratings
June 18, 2018 |
79
15
23
31
30
40
39
4
3
3
2
3
7
H1'13
H1'14
H1'15
H1'16
H1'17
H1'18
M&A
IPO
H1'18 saw more than 2x the amount of fintech
IPOs as H1'17
80
Methodology
CB Insights encourages you to review the methodology and definitions employed to better understand the numbers presented in this
report. If you have any questions about the definitions or methodological principles used, we encourage you to reach out to CB Insights
directly. Additionally, if you feel your firm has been under-represented, please send an email to info@cbinsights.com and we can work
together to ensure your firm's investment data is up to date.
What is included:
What is excluded:
Equity financings into emerging fintech companies. Fundings must be put into VC-backed
companies, which are defined as companies who have received funding at any point from
venture capital firms, corporate venture groups, or super angel investors.
Fundings of only private companies. Funding rounds raised by public companies of any
kind on any exchange (including Pink Sheets) are excluded from our numbers, even if they
received investment by a venture firm(s). Note: For the purposes of this analysis,
JD.com's finance arm JD Finance and its $1B financing were included in the data per its
investment from Sequoia Capital China in Q1'16.
Only includes the investment made in the quarter for tranched investments. If a company
does a second closing of its Series B round for $5M and previously had closed $2M in a
prior quarter, only the $5M is reflected in our results.
Round numbers reflect what has closed not what is intended. If a company indicates
the closing of $5M out of a desired raise of $15M, our numbers reflect only the amount
which has closed.
Only verifiable fundings are included. Fundings are verified via various federal and state
regulatory filings, direct confirmation with firm or investor, or press release.
Previous quarterly VC reports issued by CBI have exclusively included VC-backed rounds.
In this report, any rounds raised by VC-backed companies are included, with the
exceptions listed.
No contingent funding. If a company receives a commitment for $20M subject to hitting
certain milestones but first gets $8M, only the $8M is included in our data.
No business development / R&D arrangements, whether transferable into equity now, later, or
never. If a company signs a $300M R&D partnership with a larger corporation, this is not equity
financing, nor is it from a venture capital firm. As a result, it is not included.
No buyouts, consolidations, and/or recapitalizations. All three of these transaction types are
commonly employed by private equity firms and are tracked by CB Insights. However, they are
excluded for the purposes of this report.
No private placements. These investments, also known as PIPEs (Private Investment in Public
Equities), are excluded even if made by a venture capital firm(s).
No debt / loans of any kind (except convertible notes). Venture debt or any kind of debt / loan
issued to emerging startup companies, even if included as an additional part of an equity
financing, is not included. If a company receives $3M with $2M from venture investors and
$1M in debt, only the $2M is included.
No government funding. Grants, loans, or equity financings by the federal government, state
agencies, or public-private partnerships to emerging startup companies are not included.
81
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