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Thanks to helpful regulations, Europe has become a hotbed of fintech activity, and deals in this region have tripled in the last year.
But the looming threat of the " Brexit " could shake up the way investors pour their money into the region.
European and Israeli fintech companies raised $570 million in 95 deals in the first quarter of 2016, according to Tech.eu . This marks an increase from $561 million in 32 deals in Q1 2015. These funding amounts and deal total include mergers, acquisitions, and fundraising rounds.
These figures indicate that funding amounts have stayed consistent year-over-year while the total number of deals has increased, which means the amount per deal is shrinking.
The U.K. still leads fintech funding in Europe with 23 deals, or 25% of all funding in Q1 2016. The two biggest deals involved British fintech companies, as digital-only bank Starling raised $102 million, while remittances firm WorldRemit raised $45 million.
But the U.K. position could change as the threat of the "Brexit" looms. The U.K. will decide in June if it will remain a member of the European Union. This vote is already causing some unease among foreign investors, as 31% say they intend to reduce or freeze investments until the situation resolves.
Germany ranked second with 14 deals in Q1 2016. German alternative lender Sportcap participated in the third-largest European deal in that timeframe with $34 million. If the U.K. does leave the EU, then investors would likely look at the European fintech landscape differently, and Germany could see more fintech investments as a result.The increasing number of fintech deals in Europe demonstrates that we’ve entered the most profound era of change for financial services companies […]
