The number of European fintech start-ups continues to decline steeply year on year.
In 2017, there were 1,553 new finetch start-ups – last year, there was just 225, down 51% from when 456 made their entrance in 2020.
Does it matter? The fintech industry isn’t that big to start with, nor is it very old, so seeing such dramatic drops in new players points to a sense of maturity that will worry many and lead to speculation as to where the industry is going.
Some facts:
- there are over 3,300 active fintechs in Europe versus 4,200+ in the US (Oct 2022);
- over 70% of all European fintechs specialize in investments, lending, and payment services;
- most B2B fintechs focus on addressing white space in the SME merchant segment;
- cross-border payments and spend management fintechs are on the rise.
Should we be worrried? You can rush and point the finger at the troubled economc times, but even if you look back in 2018 and 2019, the drops in new fintech start-ups were significant. Has the European fintech industry peaked? Is there only so many things you can slice and dice with financial technology? Or more worringly, is it now the chance for TradFi to get its own back and use the economic dire times to exploit M&A strageties and pick off the best and leave the weakest floundering?
Figures and infographics come from a report from Flagship Advisory Partners entitled Breakdown of the European Fintech Landscape, 2022.
