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February 24, 2016updated 31 Aug 2016 12:46pm

UK fintech VC investment booms to almost $1bn

News: Atom Bank, Transferwise, Ratesetter help drive investment to new levels.


UK VC investment in fintech firms is up 35% in 2015, reaching $901m, according to new figures released by Innovate Finance.

There were 72 deals in total, with the large funding rounds from Funding Circle, Transferwise, WorldRemit, eToro, RateSetter, Azimo, The Currency Cloud, MoneyFarm, and Seedrs helping drive up the total.

This money included two of the biggest deals in the world – the $125m investment in Atom Bank, and $150m into Funding circle.

Other major UK deals were investments in Ebury Partners, Transferwise, and World Remit, which all worth over $50m.
Overall, the UK had the highest volume of deals outside the US, and the third highest total investment behind the US and China.

UK fintech also had the largest tech IPO globally, with Worldpay, while in the US the IPO of Twitter founder Jack Dorsey’s square was also notable.

More than 60% of the venture capital investment in the UK into fintech was in peer-to-peer, alternative finance, and payment and remittance. This becomes 74% of the total if challenger banks are included.

Robo-advice, capital markets, data analytics, crowd funding, were among other categories that received investment, alongside some emerging categories.

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Lawrence Wintermeyer, CEO of Innovate Finance said: "One of the big trends in 2015 was investment in FinTech by financial institutions in incubators, accelerators, labs, talent, partnerships, digital M&A, and corporate venture funds. A couple of years ago, entrepreneurs in the community were looking for introductions to VCs. Last year, they were interested in introductions to institutions. What this reveals is that corporate venture funding could be the new smart money for FinTech."

Globally there were 860 investment deals in fintech, totalling $12.5bn, across 46 countries. The most active investor in fintech globally was Sequoia, who did 15 deals, including in Stripe. In the UK that tile goes to Seedcamp who did 15 deals, including those with Transferwise and property partner.

Techstars did the most pre-series A deals both globally, with 15, as well as in the UK.

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