Every six months, the Fintech Observatory publishes a study that deciphers the main trends in the field in France. The study it conducted on the fundraising of the last six months shows that, although the geopolitical context has impacted the financing of fintech, it has remained stable compared to the first half of 2021, the number of operations has increased but the average basket has decreased.

Fintech investment was up significantly from 2018 to 2021, a record year, despite the pandemic. While the sector thought the acceleration would continue on the same path this year, the international geopolitical context, the return to inflation and the presidential elections have impacted fintech companies just as much as others.

Financing in the first half of 2022

Fintech funding was €1.4 billion, up 4% from €1.3 billion in Q1 2021:

• More deals: 66 compared to 56 in 2021. Among them, new mega-deals: 5 raises were above €100M: Payfit (€254M), Alan (€183M), Alma (€115M), Descartes (€107M) and Spendesk (€100M);
• A lower average ticket: €21 million per deal, down 16% compared to H1 2021, and down 28% if we consider the full year.

However, the disparity between mega-deals and an increase in “early stage” investments in younger companies must be considered. According to the study, there were two causes for this decline in the average deal ticket compared to 2021:

• The 10 largest deals totaled €1 billion of funds raised, compared to
  1.9 billion in 2021;
• A strong recovery in early-stage deals (seed and series A up to €3 million) with 55% of deals in the first half of the year compared to 41% of fundraising.

On the one hand, the international geopolitical context and the elections clearly weighed on activity, which was reduced between February and April. However, the number of deals resumed at a sustained pace in May and June, with 70% of deals taking place in seed stage, with younger companies attracting more investor attention. The decline in valuations at the international level is effective, for some players, it has been divided by 2 or more in 6 months, for the Observatory, it is still difficult to speak of a decline in
For the Observatory, it is still difficult to speak of a decline in the value of fintech in France in light of the figures for the first half of the year.

Insurtech in the lead

Assurtech is the leading business, followed for the first time by middle and back-office solutions. Payment, in third place, retains its leadership position in cumulative fundraising since 2010

• Insurtech stands out at the top of the deals in the first half of 2022, capturing 35% of the funds raised, i.e. €477M raised, notably by Alan (€183M), Descartes (€107M) and +Simple (€90M).
• Payment remains the leading fintech sector that attracts the most investors, with €1.7 billion raised since 2010 by the main paytechs Swile (€286 million), Spendesk (€260 million), Lydia (€225 million), Alma (€180 million) and Wynd (€111 million).
• Dynamic M&A: 14 transactions were recorded during the first half of the year (compared to 22 for the full year 2021). Most of them were concluded by Fintech players, who benefited from fundraising to finance acquisitions, such as Luko (with Coya and Unkle) Swille (Okarito), October (Credit.fr), Ibanfirst (Cornhill International), Yousign (Canyon), +Simple (Aleade and SAY) or Checkout (Ubble).

Translated from Etude de l’Observatoire de la Fintech sur les levées de fonds réalisées durant le 1er semestre 2022