LONDON—Fintech has gobbled the lion’s share of capital in European tech for the past two years, but after a strong 2021, there are signs that growth might be cooling, a new report suggests.
European fintechs raised $6.7 billion in the first quarter of 2022, according to Dealroom data — in line with the $7 billion raised in the last quarter of 2021, Sifted.com reported. The company said its analysis is based on a review of funding rounds by companies founded in 2005 or later and founded in or headquartered in Europe.
“The headline figure was buoyed by mega-rounds raised by Checkout.com and Qonto. And the number of overall deals actually fell on quarter,” Sifted.com said.
The sector closed 220 rounds as of Monday, down from 271 in Q4 2021 — which had been a drop from the 300+ totals in previous quarters. The Q1 2021 total is also the smallest number of rounds since Q4 2015, when the sector closed 216 rounds, Sifted.com explained.
“It’s worth noting that given the reporting lag in venture, there are likely many more deals that will be announced in the future. But investors and founders say that given predictions for a global slowdown and softening public markets, the exuberance of 2021 may have faded slightly,” Sifted.com said.
Added Nahu Ghebremichael, partner at Singular, “So far I wouldn’t say this climate has necessarily stopped things, but we’re starting to see softness across the board.”
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