1. Global Trends:
• Global fintech funding dropped 18% quarter-over-quarter (QoQ) to $28.8 billion, despite a record-high number of deals at 1,399, up 7% QoQ.
• This marked the largest percentage drop in quarterly funding since 2018, though it remained the fourth-strongest quarter on record.
2. Mega-rounds:
• The number of $100M+ mega-rounds continued to decline, with 75 deals totaling $16.3 billion.
• Mega-rounds accounted for a smaller percentage of total deals (5%) and funding (57%) compared to each quarter in 2021.
3. Unicorn Births:
• Over 30 new fintech unicorns were minted for the fifth consecutive quarter.
• The US accounted for half of the new unicorns, with 17 new additions. The global total of fintech unicorns reached 267, up 93% year-over-year (YoY).
4. Regional Funding Insights:
• Funding to Asia-based fintechs dropped 44% QoQ to $4.8 billion, despite a record 388 deals, up 6% QoQ. This was driven by a shift towards smaller, earlier-stage rounds.
• The US led in both deals and funding, followed by Europe.
5. Top Investors:
• Four of the top six fintech investors were not venture capitalists (VCs), including asset managers and corporate venture capitalists (CVCs).
• Tiger Global Management was the most active fintech investor, backing 39 companies.
6. M&A Activity:
• There were five M&A exits valued at over $1 billion in Q1’22, compared to just two in Q4’21.
• The top M&A deal was Coinbase’s $2.2 billion acquisition of 2TM, the owner of Mercado Bitcoin, Brazil’s largest crypto exchange.
7. Sector-specific Insights:
• Banking funding reached a four-quarter low, nearly halving since Q2’21, but still grew 22% YoY.
• Insurtech funding saw a significant decline of 58% QoQ to $2.2 billion, the largest percentage drop among fintech sectors.
• Africa saw a record 69 fintech deals in Q1’22, up 44% QoQ, totaling $293 million in funding.
8. Investment Trends:
• Early-stage deals saw a slight drop in share to 62%, while mid-stage deals accounted for 14%, and late-stage deals for 12%.
• The median late-stage deal size dropped by 22% to $70 million, while early-stage and mid-stage deal sizes remained flat.
9. Geographic Trends:
• Europe saw record mega-rounds, while the US experienced a 25% QoQ drop in mega-rounds.
• For the first time, the US and Asia tied for early-stage deal share, each drawing 29% of early-stage deals.