Globally, the total volume of fintech deal activity, which includes financings by private companies, IPOs, and M&A activity, has declined for three consecutive quarters. Activity in the second quarter of 2022 was down 67% from the peak, which was recorded in the third quarter of 2021. Financings by private companies in the sector were at their lowest level since the fourth quarter of 2020, at $27.6 billion (for perspective, this is still higher than any quarter in 2019 or 2020). However, 2022 is the second largest year ever by financing volume raised by fintech companies, despite the overall decline in the market. The number of financings by quarter has increased from the prior two quarters, though proceeds raised by round have declined.
Source: FT Partners
In the second half of 2022, thirty-six fintech companies attained unicorn status, including Binance.US and Backbase, among others. Three fintechs reached “decacorn” status (or a valuation of $10 billion or higher), including KuCoin, Rippling and Deel. Funding within the fintech sector remained most vibrant in North America, which accounted for 48% of the total number of completed deals in the quarter, and 50% of the total dollar volume. There have been no fintech IPOs in the United States in 2022 year to date.