UK position despite challenging global marketis the top destination for fintech investments, a new report reveals. However, the investment gap between men and women is widening.
in order to show off 2022 Investment Landscape Report, Industry group innovation finance hosted a panel discussion and Q&A at the Guildhall in London. City of London Corporation.
The ‘Capital Investment in UK Fintech in 2022: Insights and Trends’ session responded to industry reflections from Fintechs and investors on capital raising and investment in 2022. 2023.
global view
After a record year for fintech investment in 2021, investment fell globally last year. Globally, fintech will attract $92 billion in venture capital (VC) in 2022. This is a significant drop from his $130 billion invested in the sector in 2021.
Venture funds deployed $23.3 billion in early-stage global fintech, compared to $31.5 billion in 2021, and $50.5 billion in late-stage, compared to $82.4 billion in 2021.
However, the seed investment round performed better than expected, with a net profit of $7.5 billion in 2022, up significantly from the $5.8 billion raised in 2021. A 2022 growth and expansion private equity deal raised his $10.7 billion, matching 2021’s.
UK performance
UK garnered $12.5 billion in fintech VC investment, of which $8.9 billion was invested in the first six months of 2022 alone. This is an 8% decrease from her 2021 investment compared to 2021, but still cements the UK’s second position in the world rankings. It is the US contender, ahead of India in third place.
women investment
In 2021, female-founded and female-led fintech companies accounted for 9% of all VC activity in UK fintech. Sadly, in 2022, this investment will see him plummet to $616 million on her 39 deals, accounting for just 4.9% of his total investment in UK fintech.
“There are huge opportunities beyond areas where a lot of fintech funding has already been committed.”
Views for 2023
Tim Levine CEO, Augmentum Fintechtook the “half-glass picture” predicting a weaker first half of the year but an upturn in the second half of the year.
“There is still a fair amount of dust left in the European venture capital ecosystem. Dry powder cannot be confused with withdrawn capital.
“But ultimately investors have to invest and they can’t leave it alone. There’s a lot to wait to see how it unfolds, so I think investors are looking inward, but basically we’re getting high quality fintech businesses funded and we’re making sure we have a capital base. It will undoubtedly exist, but it will unfold over time and the ratings will be milder.”
Kevin Chong co-founder of outward VCThe Innovate Finance report remains largely “reassured” by the numbers, but agrees the slowdown will continue in the first half of 2023.
“This number is very encouraging given how difficult last year has been and compared to other regions. I’m trying to figure out what to focus on.
“I would be more optimistic about the second half of the year if there are no more geopolitical shocks.”
Main industry
ax ant, Partner, Ray, It suggests that there are still areas where innovation is just beginning in Fintech, such as Insurtech and Wealthtech.
he said: Insurtech funding is up he’s 70% and wealth tech funding is up he’s 110%. These are still industries undisturbed by the use of fintech on both the B2B proposition and the B2C side. “
“So I think there is a huge opportunity beyond the areas where a lot of fintech funding has already been poured.”
Diversity issue
Janine Hart CEO of Innovate Finance said: There is clearly work to be done not only with regard to gender diversity, but broader diversity such as racial diversity, LGBTQIA+, neurodiversity and even socio-economic diversity. “
Chong commented: Without tracking, I don’t know if it’s increasing, so I think we’re seriously lacking data at this point. I know it’s a problem, but it’s actually very hard to quantify because there isn’t enough data on a detailed level. “
Fintech Times Main points of today’s session
- 2021 activity should be removed from all statistics
- In 2022, many venture capitalists lost their heads and lost sight of the fundamentals
- Hot sectors and trends should be approached with caution in 2023
- Delayed capital deployment in 2023, but improvement in Q3
- 2023 will provide a ‘healthy correction’ for private markets
Fintech Week London launched Industry Review to deal with explosive growth and rapidly declining funding and valuations. Suzanne Chishti.