Many venture capital firms are selling their fintech investments and generating substantial returns: the exit volume is rising rapidly.
VC firms sold fintech shares worth $940 million in the third quarter of 2017 alone. In the previous quarter, VC investors' fintech exits totaled $270 million. This represents a two-and-a-half-fold increase. The results come from a regular survey conducted by the consulting firm KPMG. For the months of July to September, the study measured the second-highest total ever and the highest fintech proceeds since 2010.
“Investments at a high level”
At the same time, the record exits do not mean that venture capital investors are withdrawing from the fintech industry: new investments also increased from the second to the third quarter of 2017, from 3.0 to 3.3 billion US dollars.
Investment activity is also picking up in the insurtech sector. Deals totaling $1.53 billion were already closed in the first three quarters of 2017. Investments for the full year of 2016 totaled $1.79 billion. KPMG Partner Sven Korschinowski says:
"Thanks to the commitment of venture capital firms, investments in fintechs remain at a high level this year. However, investors are increasingly focusing on more mature companies whose business models have already proven themselves. After all, at the end of the day, it's all about creating value and generating revenue. In the insurtech sector, a new record is emerging this year in terms of both the number of deals and the amount invested."
Corporate venture capital is booming in Europe
In Europe, fintech investments fell by 17 percent to $1.66 billion in the third quarter compared to the previous three months. Venture capital accounted for almost half, or more than $700 million. Corporations intensified investments through their own VC firms, increasing their share of the overall VC fintech market from 13 to 20 percent.
