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Report: Asian Fintech Funding Stagnates Despite Record-Breaking Global Deal Volume
FinTech, AI, Blockchain
While global fintech M&A continues to shatter records, Asian fintech funding remains dull, according to a report by Hampleton Partners.
Fundraising in fintech continues its record-breaking course. With 818 fundraises so far in 2019, the anticipated annualised figure of 1,636 would set a new annual record, narrowly beating those figures recorded in 2017 (1,632) and in 2016 (1,633). Furthermore, excluding the Ant Financial deal of June 2018, Q2 2019 recorded the most fintech fundraising ever with $10.9 billion raised.
All this confirms that, while they seem to be gradually multiplying in number, fintech funding rounds in North America and Europe are becoming larger. However, Asia is not currently sharing the same level of fundraising success, with fundraise count and value stagnating.
Deal volume in Asia apparently dropped 30% year-on-year, with China – a “habitual hegemon” in fintech fundraising – spending only $35 billion in the first half of 2019. That’s a 75% fall from 2016, and largely attributed to the trade war and tariffs. Overall, Asian fintech fundraising came in at $3.5 billion, just slightly more than half of Europe’s $5.8 billion.
At any rate, current fundraising levels point to a “readiness” in large players to adopt fintech, especially in transaction processing and enterprise financial software.
Three of the largest fintech deals of the year where in transaction processing, with Fidelity’s $43.6 billion acquisition of WorldPay taking the top slot. Fiserv’s $22 billion purchase of First Data came in second, while Global Payments’ $21.2 billion merger with Total System Services rounded up the top three.
As for enterprise software, the sector saw two deals over $1 billion mark: Thomas Bravo’s acquisition of cloud-based platform provider Ellie Mae, and BlackRock’s buyout of portfolio management software maker eFront. The deals were for $3.7 billion and $1.3 billion, respectively.
Photo: sung ming whang