NEW YORK—During the first six months of 2023 total funding fintechs and the number of deals declined from $63.2 billion across 2,885 deals in the second half of 2022 to $52.4 billion in across 2,153 deals in the first half of 2023, according to a new KPMG analysis.
“The cloud of uncertainty permeating the market continued to wear on investors, driven by factors including global macroeconomic concerns (high inflation and rising interest rates), geopolitical tensions (the ongoing conflict between Russia and the Ukraine), and tech sector challenges (depressed valuations and a continued lack of exits),” KMPG said. “The collapse of several U.S. banks early in 2023 likely also kept many investors in wait and see mode…”
Some Growth Areas
Not all the news for fintechs was negative in the first half of the year. According to KPMG’s Pulse of Fintech, a number of sectors attracted robust funding during the first half of 2023, including supply chain and logistics-focused fintechs, which attracted $8.2 billion in funding in in the first two quarters of this year—well above the space’s 2019 annual record of $5.5 billion.
“Green fintech also had robust interest, with $1.7 billion of funding during the first half of ’23— already slightly ahead of its 2022 results ($1.5 billion),” KPMG said.
At a regional level, the Americas saw fintech funding grow—from $28.9 billion to $36.1 billion between the second half of ’22 and the first half of ’23—despite a decline in deals volume—from 1,323 to 1,011 deals—over the same timeframe, KPMG said.
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