2023年欧洲金融科技状况-资金纪律的回归引发了生态系统为生存而争夺盈利能力的斗争

TheReturn of Funding disciplineresulted in aFlight toQualityandProfitabilitytoSurvive Introduction Welcome to Finch Capitals 8th edition of the“State of European FinTech”report inwhich we take a closer look at Europe’s FinTech sector. Given the market backdrop,we focus on 3 core areas that provide an analysis of the sector and a forecast foropportunities that will likely emerge including:(1) State of European Fintech, (2) State of Fintech in Key European Countries and (3)Opportunities Likely to Emerge In Current Situation Finch Capital is a Growth Investor in Europe’s Biggest Technology Transitions. Wecurrently focus on 6 themes: FinTech (incl. Health and Insurance), Payments,Business Applications (Incl Accounting, Tax), Regulatory and ESG Software and RealEstate Technology. We back companies generating €2m+ in ARR by investing €5 to€15m initially and help them scale to €30m-€50m revenues by building sustainableand capital efficient business models. We’ve invested in±45 companies includingFourthline, Goodlord, Grab, ZOPA,Twisto,AccountsIQ,NomuPayand Symmetrical. These topics are good proxies for the overall health of European FinTech which, aswe predicted last year, has now entered a period of contraction. Unsurprisingly,there will be losers, but like in every market cycle, there will be winners as well.Laser focus on building profitable businesses at sustainable valuations will driveeconomic value to all stakeholders in the future. Finch Capital consists of a team of 12 investment professionals with wideentrepreneurial experience located across offices in Amsterdam, London and Dublin.For more information seewww.finchcapital.comand subscribe to our newsletter. Eugénie Colonna d’lstriaAssociateEugenie@finchcapital.com Radboud VlaarManaging PartnerRadboud@finchcapital.com Aman GheiPartnerAman@finchcapital.com Joe McHaleAnalystJoe@finchcapital.com Executive Summary The year of reckoning has arrived in European FinTech. TheReturn of Funding discipline resulted in a Flight to Quality andProfitability to Survive for the entire ecosystem. European local ecosystems have been impacted differently based on their maturity •US investors were ranking in the top lists in major countries in 2021/H1 2022, but have disappeared this year•UK, Germany and France saw a 70% drop in funding value BUT exits were getting done consistently•Ireland and Netherlands are more elastic to single deals (Fourthline&NomuPayrespectively) in both regions•Poland recorded biggest drop, but the crypto infrastructure sector is gaining momentum •Funding dropped by 70% to pre 2020 levels driven by theend of mega round and flight to quality;•A retreat in Payments and Challenger Banks as thetraditional resilient sector loses its crown to Crypto andLending given valuation benchmarks achieved in 2022;•US, Asian and Strategic investors are retrenching and are in50-100% less deals than they were last year;•M&A has remained stable with volumes on track to match2022 levels, but deal sizes have fallen dramatically with 19%of deals above €500m vs 30% last year;•Valuations are stabilizing in the public markets which willhelp private companies to get funding/exits, but at differentterms than before, which will take time before all companiesreset "last round" to "current" valuations The trend of a shift to software and B2B FinTech continues in 2023. More than 50% of all fintech deals are B2Bsoftware versus 17% in 2016. •Business models: Some balance sheet business are in tough spot with loan losses rising as well as thosewithout own deposit funding. Focus on recurring software businesses with strong margins and NRR vs.product led hyper growth. •Key areas we foresee strong momentum the next 6 to 12 months are: •Revisit of the payment investment landscape, with accelerated consolidation expected to boostprofitability and growth•RegTechcontinues to show attractive growth in KYC and AML•Consolidation of Open Banking and Banking as a Service continues•Generative Artificial Intelligence will get at scale in Insurance and Banking•Automation and Digitalization of the CFO and HR function continues to increase control and efficiency 1.State ofEuropeanFinTech Macro 50%Up from 45% in H1 2022 €4.6BnDown 70% from €15.3Bn in H1 2022 Capital invested in EuropeanFinTechsin H1 2023 UK share of total capital raised 19.7%Up from 14.1% in H1 2022 463Down 48% from 884 in H1 2022 Share of announced flat anddown rounds in H1 2023 Number of deals in H1 2023 3rdDown from 1st in 2022 Rank of Payments & Banking inamount raised for all FinTechsub sectors -84% Decrease in M&A transactionvalue versus H1 2022 1054Last 12 months Number of hires from Top 10fastest growing EuropeanFinTechs Announced total laid-offemployees in EuropeanFinTechsin the past year -3100 After Many Years Dominating, Payments & Banking is No Longer The Leading Sub Sector Top subsectors in deal volume 1.Lending*2.Crypto/Blockchain3.Payment/Banking4.Wealth/Investing5.Insurance In 202