Fintech segments

Payments sector regains momentum

After falling to $17.2 billion during 2023, global investment in the payments space picked up to $31 billion in 2024, driven significantly by defensive transactions. While deal value was heavily weighted towards H1’24 due to the $12.5 billion Worldpay deal, investor interest grew considerably in H2’24 as interest rates started to come down in many jurisdictions and as some global uncertainties began to stabilize. Similar to H1’24, the Americas attracted the largest payments deals, including the $6.3 billion take private of Canada-based Nuvei by PE firm Advent International and $1.6 billion acquisition of US-based Transact Campus by Roper Technologies.

Absence of M&A megadeals sinks Insurtech investment total

Total investment in insurtech dropped to just under $3.1 billion in 2024 — a level not seen in over ten years, driven in large part by the complete absence of M&A megadeals, which had become a staple in
the market in recent years. While the number of deals dropped only marginally year-over-year, deal sizes were relatively small compared to historical trends, particularly in the second half of the year. A $192 million raise by France-based Alan was the largest deal of H2’24, followed by a $140 million raise by
US-based Zing Health, and a $120 million raise by France-based Akur8. This compares to H1’24, when the largest deal was the $427 million acquisition of cyber-insurance company Corvus by Travellers.

The declining investment reflects a shift in investor sentiment from rational exuberance to realism; insurance carriers have become the major driver of insurtech investment as VC firms have pulled back given the high cost of financing and uncertain macroeconomic conditions.

Regtech investment tapers off after H1’24 megadeal

Total global investment in regtech rose from $4.4 billion in 2023 to $7.4 billion in 2024, although the increase was driven primarily by Leonard Green’s $4 billion buyout of UK-based IRIS Software Group in H1’24. While investment in H2’24’s was much lower in H2’24, total deal volume remained relatively consistent between the first half of the year and the second. 

Given the complexities of the regulatory environment in financial services, there continued to be a lot of investor interest in regtech — particularly in software-as-a-service companies — although completed deals remained far and few in between during H2’24 as investors held off from completing deals given uncertainties within the global macroeconomic environment. Investor sentiment started to improve in Q4’24, which bodes well heading into 2025.

Cybersecurity investment quiet in H2’24 as big players focus on integration

Direct investment in the cybersecurity space was very soft in 2024, accounting for just $890 million compared to $1.4 billion in 2023. After a very quiet H1’24, cybersecurity investment slowed even further in H2’24, driven in part by global macroeconomic challenges and the absence of significant M&A deals. Deal sizes were quite small during H2’24; the largest deal of the period was a $90 million raise by South Africa-based Cassava Technologies.

In recent years, the nature of investment in cybersecurity has shifted quite dramatically, with acquisitions by major tech companies — both global and regional — having a bigger role to play in investment totals than the cumulative value of smaller deals. The absence of these kind of acquisitions likely accounts for the significant drop-off in funding in H2’24 given cybersecurity continues to be a significant challenge across all regions.

After falling to more than ten-year low, investment in wealthtech doubles in 2024

Total global investment in wealthtech doubled from a more than ten-year low of $190 million in 2023 to $400 million in 2024. Most of this investment came in H2’24, including four of the five largest wealthtech deals of the year — a $73.9 million raise by US-based Edward Jones, a $60 million raise by US-based Bitwise, a $58.5 million raise by Sweden-based Baseload Capital, and a $47.9 million raise by India-based Neo Asset Management. 

Brighter skies ahead for digital assets space

Investment in digital assets and currencies globally rose from $8.7 billion to $9.1 billion between 2023 and 2024, although the more notable rise came in the US, where investment in the space rose from $3.2 billion to $5.4 billion year-over-year. Interest and investment in the US picked up in H2’24, driven by a combination of factors including the election of a new US president expected to be crypto friendly, Bitcoin reaching the $100,000 mark for the first time, and the increasing involvement of institutional investors —which has helped cement crypto’s place as a legitimate asset.

The Americas saw the largest deals in the digital assets and currencies space in H2’24, including Stripe’s $1.1 billion acquisition of stablecoin infrastructure business Bridge and a $525 million raise by Praxis — both based in the US — and a $210 million raise by Canada-based Blockstream. A $100 million raise by UK-based Crytocoin and an $80 million raise Singapore-based Partior — a blockchain-based, real-time clearing and settlements firm — were the largest deals in EMEA and ASPAC, respectively.