13 Feb Money of the future 2015
Fintech startups worldwide raised a total of $6.8B in 2014. This is three times more than in 2013, when the total investment amount in fintech was $2.2B.
Industry isn’t considered as a fully established one until the first IPO takes place. Everyone expected Square to be the first fintech company to undertake IPO. However, it postponed its listing, while p2p-lending platform Lending Club hold a successful IPO.
Perhaps, the most important event of the year in FinTech industry took place in December: Lending Club held IPO, in which the company raised $870 M, while valued at $5.42 B. This is not only the largest FinTech IPO of the year and the first IPO of p2p-lending platform, but also a milestone which will determine the parameters of other deals in loans and increase investor interest in FinTech projects as a whole. In addition, share price growth that followed the IPO fueled the expectations of investment banks and private investors about other tech IPOs. After Lending Club, OnDeck, working in a related field of SME lending, followed with its IPO, in which it raised $200 M at $1.3 B valuation.
In 2014, Asia for the first time entered the list of regions, which attracted most investments in FinTech, due to the big inflow of funds into Chinese projects. At the beginning of 2015 it was announced by China’s government that it is going to launch a new 40B RMB (around $6,5B) venture firm to invest in seed-stage tech startups and promote technology and market integration. .We must improve the high-tech, high-value-added services., said statement, released by the government.
China is also fostering Internet of Things (IoT), in November China’s Shanghai-Nanxiang government and IDG Capital Partners announced a partnership with Melbourne-based online crowdfunding platform Pozible, dedicated to IoT projects. Chinese government is also planning to invest $470M in IoT by 2020, which makes it global leader in this sector according to Aliza Gao, a representative of Shanghai hardware accelerator Tech50.
In the meantime what paved the road for China to FinTech-related publication’s headlines was Alibaba, which held last year the record-breaking IPO: company raised $25 B during the placement on the NYSE, having sold shares at a price of $68 per share.
Investors valued the entire company at $170 B. Now the company’s shares are traded on the NYSE for about $100 per share — thus, IPO was successful for investors too. According to statistics of payments provider AliPay, an affiliate of Alibaba Group, by the end of 2013 service has helped to transfer $150 B of mobile payments. That is about three times more than turnover of PayPal and Square taken together. 300 M people are registered in the service, 54% of the total volume of AliPay’s transactions are mobile payments.
Read the full report here
