2018 witnessed the highest level of investment in fintech start-ups on record, with a total disclosed transaction value of USD30.8 billion, according to the latest Fintech M&A Market Report from international technology mergers and acquisitions advisor, Hampleton Partners.
As fintech start-ups mature, the average funding round has doubled in size compared to 2017, with the average venture round in the Asia-Pacific region reaching almost double the global average.
The stellar fintech M&A transaction value of USD50 billion from 189 transactions achieved in the first half of 2018 was not replicated, however, as second half activity cooled, recording 160 transactions and a total disclosed transaction value just shy of USD13 billion. The decrease in value was largely due to the absence of disclosed blockbuster deals akin to Blackrock’s USD17 billion acquisition of Thomson Reuters in H1 2018.
Trailing multiples on a 30-month median basis continued their upward movement: revenue multiples reached 3.0x, up from 2.9x in 1H 2019, while EBITDA multiples reached 15.3x, up from 15.0x in 1H2018.
Jonathan Simnett, director and fintech specialist at Hampleton Partners, says: “In the latter half of 2018, the UK continued to lead the way in fintech in Europe, breeding a new generation of innovators with record levels of investment following the lead of new unicorns like Monzo and Revolut. Retail banking has led the charge in upgrading digital consumer experiences, whilst incorporating fintech into core banking products, whereas investment banks have been more focused on integrating robo-advisory services.”
