1、October 20243Letter From the Authors4Investor Perspectives6Macro11Capital 19ExitsFUTURE OF FINTECH 20242Generative AI is opening possibilities for value creation in fintech.Legacy companies are improving efficiencies by reducing labor costs,while AI-native companies are building novel solutions.The

2、long-term vision is compelling.Hyper-personalization of financial services and advice will accelerate the expansion of open banking through secure data sharing between financial institutions and third-party providers.”FUTURE OF FINTECH 20243Nick ChristianHead of National Fintech and Specialty F Bria

3、n FoleyMarket ManagerFintech and Warehouse L Notes:1)See our AI analysis on pages 17-18.2)See payments share of fintech unicorn value on page 20.3)See our regulatory spotlight on page 10.Heres a conversation starter for your next industry dinner party:Whats the most pivotal moment in the history of

4、fintech?You might say 1967.The first automated teller machine is installed outside a bank in London,unshackling customers from normal business hours.What about 1998?That year saw the first 1 million internet purchases,as electronic payment systems began to forever change how people make online payme

5、nts.Some might say 2009.The Global Financial Crisis shakes consumer confidence in big banks just as millennials are entering the workforce with iPhones in their pockets and mobile banking is born.Then again,what if that moment is now?The tectonic disruption of generative AI(GenAI)is reverberating ju

6、st as the sector grapples with heavier oversight and rising costs.These changes are forcing investors and founders alike to reimagine what fintech is,and what it can become.In this fourth edition of our annual report,The Future of Fintech,we leverage SVBs unmatched proprietary data and our broad net

7、work of sector experts for an in-depth look at the health of the fintech sector.Our findings show that while fintech companies are facing significant headwinds,they are also finding immense opportunity.GenAI is opening possibilities for value creation in fintech.Legacy companies are improving effici

8、encies by reducing labor costs,while AI-native companies are building novel solutions.The long-term vision is compelling.Hyper-personalization of financial services and advice will accelerate the expansion of open banking though secure data sharing between financial institutions and third-party prov

9、iders.This new generation of fintech companies is creating more value per dollar invested than legacy AI companies.1 They are building tools to automate portfolio management,retirement planning,market intelligence and many other facets of the sector.More conventionally,payment companies remain prime

10、d for growth as the shift toward embedded finance continues,creating new revenue streams and distribution channels that are shoring up customer acquisitions.2That resilience will be needed as fintechs face heavier regulatory oversight.3 The collapse of Synapse in April is fanning the flames for thos

11、e who believe fintechs should be regulated as strictly as banks.Whether youre building toward that reality with new tools to aid in compliance,or simply navigating those choppier waters,it bears remembering that every fintech company is,ultimately,a compliance company.Source:SVB Interviews.FUTURE OF

12、 FINTECH 20244When a company sees adding software they see adding an expense.The solutions that are powered by AI are not selling software;they are selling work.AI companies are not competing with software budgets;they are competing against hard labor costs.Now,the hard part is can you do what you s

13、ay you can?Matt HarrisPartner“Technology is not a moat.It maybe never was,but it certainly isnt anymore.It plays an important role but defensibility has to come from somewhere else.You need one foot back in the traditional world:SWOT analysis,ground game of selling,sales cycles all that is almost mo

14、re important.”Nico StainfeldPartner“For a long time,fintechs thought compliance was a rubber stamp and regulators were there to slow things down:Why dont we move fast and break things?It turns out,you cant do that.Regulators biggest fear is layering of fintech compliance that the bank doesnt know wh

15、o owns the customer accounts.Over the last three quarters weve seen a reckoning.That is not going to fly anymore.”Victoria ZuoPrincipal“During the fintech funding boom,a lot of hype was centered around neobanks or models monetizing via interchange.Were now seeing a shift toward software selling into

16、 financial services,solving for human-intensive functions such as onboarding or product customization.Startups building in these areas are not only changing how financial institutions operate,but how they engage with increasingly global and nuanced customer base.”Dave MullenPartner“We thought rebund

17、ling the bank was going to happen seamlessly,but it turned out to be a bumpy ride.On the way to building full stack financial service products within b2b software,you have to have enough revenue stream enough proof points.You cant launch everything all at once.”Adam NelsonPartner“The gap between see

18、d and Series A valuations has narrowed.The risk/reward at Series A now looks so much better.Usually,youd see a 2.5x to 3x step-up for Series A.When we looked at the top quality deals at Seed and Series A,that gap has narrowed to 1.5x to 2x.What youre getting is a lot of de-risking.For many reasons,i

19、t doesnt make sense to be playing at seed anymore for the multistage funds.A lot of people are starting to put their time,effort and energy into Series A.”Emily ManPartner“Investors are adjusting to what theyre seeing in AI companies,which is really fast growth.Getting to$3M-$5M ARR on a seed round

20、used to be exceptional,but a lot more AI companies are getting there.One reason is that teams can build products so quickly in this space,and then the new AI features are delighting customers.Customers are saying Sure,Ill try that.David JegenManaging PartnerNotes:1)SVB identified 35 fintech partner

21、banks with assets less than$10B.S&P Market Intelligence estimates fewer than 100 partner banks exist in the US.Severe enforcements defined by S&P Market Intelligence include prompt corrective action directives,cease and desist orders,consent orders and formal agreements that were issued and made pub

22、lic by federal regulatory agencies.2)The median runway for US tech unicorns was 20 months through H1 2024.3)See analysis on page 8.Source:PitchBook Data,Inc.,SVB State of the Markets H2 2024,S&P Market Intelligence and SVB analysis.Compliance must be top of mind as regulators untangle risk and confu

23、sion in customer accounts.Heightened federal scrutiny on third-party partner banks has forced fintech founders to put new urgency on regulatory compliance.Banking as a Service(BaaS)partners represent less than 2%of all chartered US banks,but have accumulated at least 10%of severe enforcement actions

24、 in the last 12 months.1 Thats up from one action the prior year.Beefing up compliance may include hiring talent,re-evaluating existing partnerships or investing in new tools,including AI-powered solutions.Custom acquisition costs(CAC)have skyrocketed in recent years,with fixed and variable costs ne

25、arly doubling for public fintechs as interest rates have climbed.3 To overcome higher CAC,some companies are leaning into value-based products as a way to entice low-cost repeat customers.For example,solutions that help customers save money or pay off debts faster are finding traction.Other platform

26、s are embedding financial services into their offerings to enhance convenience for customers and unlock new revenue streams.AI-native fintech companies are bringing a new level of automation to financial services,from reviewing insurance claims to negotiating a car purchase.However,technology is onl

27、y half the battle.When the wow factor wears off,achieving a long-term competitive advantage becomes key.Copycat competitors are ready to pounce.Customers will stick with companies that provide a variety of valued services,including data lock-in and relationship management.AI is poised to transform e

28、very fintech sector,but technology isnt the moat that founders may expect.Many fintechs raised large investments at the peak of the venture capital(VC)boom,some valued at more than the unicorn level of$1B.Among the 114 US fintech unicorns that are still active,more than 76%were last valued over two

29、years ago,when investors were hungry for deals.Now,they have lost their appetite.Exit options are limited,which may force these false unicorns to carve a path to profitability as public fintechs have done.Theres still time.Many in this group raised money during the peak of zero interest rate policy(

30、ZIRP)and still ample reserves before they must raise again.2 A cohort of fintech unicorns created in 2021-22 may be drastically overvalued with options running out.Fintechs are increasingly overcoming soaring CAC the old-fashioned way:by meeting a need.FUTURE OF FINTECH 20245Fintech finds its footin

31、g in a post-ZIRP world.FUTURE OF FINTECH 20246-5%-15%-4%-2%20212022202320240%-1%2%15%20212022202320241.0 x7.4x10.8x12.7x2021202220232024In September,the Federal Reserve started unwinding its rate hike cycle with a 50-basis-point(bps)cut.While this is certainly welcome news,it does not translate to i

32、mmediate relief for fintechs.Since early 2022,interest rates for consumer loans have skyrocketed,including a seven percentage point increase for personal loans.Those higher rates combined with the spending down of pandemic-era stimulus savings have constrained consumers ability to borrow and repay.D

33、elinquencies on consumer loans have marched steadily upward over the past two years.In response,fintechs are doubling down on acquiring customers with superior credit.High-quality borrowers command lower finance charges,and in the card space,prime demand remains high.Prime borrowers,however,generall

34、y do not carry balances,leaving lenders to reap only fixed interchange fees while experiencing higher funding costs.Customers carrying balances pay more in interest,but they also drive an increase in defaults,cutting into revenue growth.With this backdrop,revenue growth has slipped steadily.Rates re

35、main high compared to the recent past,and near-zero interest rates remain in the rearview mirror.While consistent profitability has proven challenging,the industry has proven that lenders can originate good credits in a high interest rate environment.Notes:1)Aggregated financials from a cohort of 35

36、 formerly VC-backed public fintech companies.Year-over-year comparison of calendar year financials.The 2024 data is the extrapolated year-end total based on YTD 2024 quarterly earnings.Sources:Federal Reserve,Federal Reserve Bank of New Yorks“Quarterly Report on Household Debt and Credit,”S&P Capita

37、l IQ and SVB analysis.-1%0%1%2%3%4%5%6%7%2021202220232024Percentage PointsMortgage(30-year)Auto(5-year)Personal(2-year)Credit cardsRevenue Growth(YoY Median)EBITDA Margin(Median)-2%-1%1%2%3%4%5%Q1 21Q2 21Q3 21Q4 21Q1 22Q2 22Q3 22Q4 22Q1 23Q2 23Q3 23Q4 23Q1 24Q2 24Percentage PointsMortgageloansAuto l

38、oansCreditcardsOtherloans52%27%13%12%2021202220232024Revenue growth has slowed since the end of ZIRPInterest costs have increased since 21Interest Expense(Median Indexed to 21)Interest Income(Median Indexed to 21)but profit margins are on the rise.but interest income is climbing much higher.FUTURE O

39、F FINTECH 20247Mar.21Aug.21Dec.21Jan.22Jan.23Jun.23Oct.23Dec.23May 24Jun.24Costs are growing for fintechs,but its not just higher interest rates affecting their margins.Customer acquisition costs(CAC)are also on the rise and contributing to overhead.In response,some fintechs are seeking partners wit

40、h existing customer bases.In June,for example,eBay and Venmo announced a partnership,allowing shoppers to pay for their purchases with their Venmo balance or methods linked to their Venmo account.Other fintechs,including big names like SoFi,have applied for bank charters.There is also a move to dive

41、rsify revenue streams,illustrated by Robinhoods reduced reliance on transaction fees for the bulk of its income.Both trends underscore a clear reality:As fintechs get squeezed,it is less viable for them to offer single,standalone products.At the center of these moves is a focus on customer value.One

42、 effective way to reduce CAC is offering customers value on the financial side through products that help build savings or offer rewards.Another strategy is to add products to an existing customers base.Robinhoods history of investments and acquisitions typifies this approach.Since 2021,the company

43、has added adjacent businesses that can add value to customers.These acquisition targets range from financial news and shareholder communications to credit cards and trading platforms.Notes:1)List of public financial technology companies compiled by Bain Capital Ventures.H1 2024 data is extrapolated

44、to represent a full year.2)Selling,general and administrative costs.3)FDIC deposit insurance applications and new bank charter applications of fintech companies,regardless of outcome of the application.Sources:S&P Capital IQ,Office of the Comptroller of the Currency,FDIC,Robinhood 10k filings,PitchB

45、ook Data Inc.and SVB analysis.$219M$241M$367M$430M$478M$471M1920212223H1 24$212M$227M$292M$354M$421M$542M1920212223H1 24Fixed Costs(SG&A)2Variable Costs(Cost of Revenue)201920202021202220232024FormativeBankTransactionsInterestOther62%75%77%60%42%26%18%14%31%50%13%6%9%9%8%20192020202120222023FUTURE O

46、F FINTECH 20248AcquisitionInvestmentPartnershipDriven by their customers growing expectations for digital solutions,Large Financial Institutions(LFIs)1 are increasingly partnering with,investing in and acquiring fintechs,leveraging the functionality and customer bases that fintechs have built in the

47、ir specialized areas.Acquisitions such as JP Morgan Chases purchase of WePay for payments are one way for retail banks to add capabilities without building them in-house.At the same time,strategic partnerships can create efficiencies in customer acquisition.However,achieving a proper win-win in thos

48、e relationships can be difficult to strike.Wells Fargos partnership with credit card provider Bilt Rewards has attracted skepticism after gaining initial traction signing up millions of customers through its offer of feeless rent payments.The Wall Street Journal reported that Wells Fargo is losing m

49、oney on the deal,which is producing less revenue than expected.Publicly,both companies remain committed to the project,which expires in 2029.Note:1)LFIs are those banks with over$100B in assets,according to the OCC.List is not exhaustive;select fintech companies represented.2)As of 6/30/2024.3)Trail

50、ing twelve months.4)Wells Fargo has invested in and partnered with Bilt Rewards.Source:PitchBook Data Inc.,CB Insights,Federal Financial Institutions Examination Council,“Top Holdings,”SVB proprietary data and SVB analysis.Payments/Embedded FinanceLendingDigital BankingFinancial SoftwareCredit Cards

51、Blockchain/CryptoTotal assets2FUTURE OF FINTECH 202494$4.1TTTM3 Revenue$161BInvestments andM&A since 2020137Total assets$2.4TTTM Revenue$70BInvestments andM&A since 2020168Total assets$1.9TTTM Revenue$78BInvestments andM&A since 20203620202021202220232024-10%40%90%140%20232024The April collapse of S

52、ynapse,a BaaS startup,locked 100K customers out of their savings accounts,raising concerns from the Federal Deposit Insurance Corporation(FDIC)about the fintech-banking relationship.Fintech partnerships are intended to be symbiotic,with tech companies like Chime providing a user-friendly front-end w

53、hile a chartered partner bank such as The Bankcorp or Stride Bank provides the FDIC-insured accounts and handles risk and compliance.This allowed fintechs to walk like a bank and talk like a bank while leaving the actual banking to someone else.In the last decade,deposits in fintech partner banks1 h

54、ave skyrocketed,growing 9x faster than deposits in small US banks overall.In September,the FDIC proposed regulations requiring financial institutions to hold fintech partners accountable for managing consumer banking data,and strengthening recordkeeping requirements for bank deposits received from t

55、hird-party companies.Regulators are stepping up their oversight by issuing 50 severe enforcement actions in the last six months,a 2.5x increase from the severe enforcements filed in same period last year.A lopsided number of these actions are targeting partner banks.Startups are responding to the in

56、creased regulation by beefing up compliance talent and by reviewing existing processes,in some cases severing ties with partners.That opens the door to AI-native startups who can meet a high bar for regulation with new tools for automation.Notes:1)Banks with under$10B are exempt from the Durbin amen

57、dment,which limits transaction fees an issuing bank can charge a merchant.2)SVB identified 35 fintech partner banks with assets less than$10B.S&P Market Intelligence estimates fewer than 100 partner banks exist in the US.Severe enforcements defined by S&P Market Intelligence include prompt correctiv

58、e action directives,cease and desist orders,consent orders and formal agreements that were issued and made public by federal regulatory agencies.3)Equally weighted returns for 35 formerly VC-backed public fintechs.Sources:PitchBook Data,Inc.,S&P Market Intelligence,S&P Capital IQ and SVB analysis.Pu

59、blic fintech cohortS&P 5002%-1%-2%0%11%5%1%2%1%10%15%8%9%36%13%7%7%2%$54B$131B20162018202020222024144%for US Fintech Partner Banks16%for US Banks Under$10BUS partner banksUS banks$10B in depositsYoY Growth:FUTURE OF FINTECH 202410Total severe enforcement actionsUS partner bank enforcement actionsUS

60、VC investment in banking startups(TTM)Regional Banking CrisisBaaS VolatilitySept 17:FDIC proposes record-keeping rules for third-party accounts.July 25:FDIC requests infoon bank-fintech relationships.April 22:Synapse files bankruptcy,freezing 100K accounts.Companies recalibrate as investors draw bac

61、k.FUTURE OF FINTECH 202411Median IRR:Limited Partner(LP)interest in the fintech space is starting to wane,with fewer US VC funds citing“fintech”as focus areas during fundraising.And those that are still interested in fintech are not raising as much money as they have in the past.Fintech-inclined VC

62、fundraising dropped 91%since its peak in 2021,with funds raising$5B through September.Announced funds,including those that have not yet closed,totaled$9B,the lowest since 2020.This drop in fundraising accompanies a decline in fintech investment overall.One in 12 US VC dollars went to a fintech compa

63、ny in 2024,down from one in five dollars in 2021.If that drop reflects a changing attitude toward fintech investment,its not due to a lack of results.Historically,funds with fintech as one of the stated focus areas have performed well,with internal rates of return(IRR)outperforming overall VC return

64、s in each of three cohorts we analyzed.VC firms are not only reducing the size of their checks,theyre also slowing their pace of deployments in fintech.In 2021,the most active 100 US fintech investors were closing more than two deals per month.That pace has dropped to less than one per month this ye

65、ar,though some are staying the course.Andreessen Horowitz has averaged nearly four fintech deals per months the last two years,bucking the larger trend.Notes:1)Focus areas may include multiple tech verticals.2)The top 100 most active fintech firms include VC-focused funds with minimum median fund si

66、ze above$50M.Sources:Preqin,PitchBook Data,Inc.and SVB analysis.4%5%5%6%7%8%9%9%12%12%12%15%17%14%14%3%4%5%5%8%12%11%11%13%15%16%19%19%16%12%201020112012201320142015201620172018201920202021202220232024$2B$9B$9B$56B$31B$26B$9B$54B$28B$12B$5B2018201920202021202220232024ClosedAnnounced21%24%11%10%19%7%

67、2005-142015-192020-23Middle 50%Fintech-focused fundsFund VintageAll other VC funds0.80.92.32.00.90.9024681012201920202021202220232024Deals per MonthMedianMiddle 50%Most investmentsFUTURE OF FINTECH 202412Percent of dealsPercent of capital201920202021202220232024VC Investment in fintech is nearing a

68、six-year low,both in deal count and in dollars.This may signal the start of a new era of leaner,more targeted fintech investing rather than the capital-heavy deals we saw in the pandemic years,particularly 2021.The end of ZIRP has stunted demand in many fintech sectors.Growth in consumer lending is

69、half what it was pre-pandemic,mortgage originations are still low,delinquencies are up and CAC costs are rising.Increased regulatory uncertainty has also put a damper on VC investment.The funding crunch is especially squeezing companies at the late stage.Valuation step-ups for Series B and C are app

70、roaching a 10-year low.Many of these companies are simply unable to grow into their inflated valuations from 2021-22.Mega-deals of$200M or more now account for just 28%of invested capital,down from 47%in 2021.This shift may reflect a fundamental change in the sector.Higher interest rates make certai

71、n capital-intensive business models less viable for venture investing,said Matt Harris,partner at Bain Capital Ventures.“Generally,were seeing that$50M-$100M rounds are not happening.That activity is never coming back.Some of that was lending companies or proptech companies that required hundreds of

72、 millions of dollars but never had a great ROI these were ZIRP value propositions.”Notes:1)Data as of 10/17/2024.Dotted line shows projected 2024 values.2)Extrapolated year-end totals.Sources:PitchBook Data Inc.and SVB analysis.$7B$8B$14B$19B$20B$53B$33B$19B$15B16%20%29%41%40%47%26%41%28%0.6K0.7K0.9

73、K1.1K1.1K2.0K1.9K1.1K0.9K201620172018201920202021202220232024Capital investedDeal countPercentage of capital in deals over$200MExtrapolated values1.0 x1.5x2.0 x2.5x3.0 x3.5x4.0 x201620172018201920202021202220232024Series ASeries BSeries CFinancial B2B SoftwareCrypto/BlockchainAlternative LendingPers

74、onal FinanceBanking/Capital MarketsInsurance TechReal EstatePayments31726584$7.4B$6.1B$7.1B$8.8B$16.6B$8.4B$14.0B$8.0B$1.6B$2.2B$2.1B$2.7B$2.2B$2.8B$5.2B$3.6BFUTURE OF FINTECH 202413Johnny Appleseed would be proud of the growth at the seed stage.Investors and founders?Maybe not so much.ZIRP ushered

75、in a new era of seed investing,catapulting a budding investment type into an established asset class.Not content just to grow and improve,investors sought yield at the seed stage,hoping to cash in and provide perceived winners with more options in the follow-on rounds.Additionally,investors new to t

76、he asset class employed a“hit and hope”strategy that prioritized deal activity over targeted bets.Mix in the emergence of dedicated seed funds and the rise in company formations and you have what we call the“seedpocalypse.”Some skeptics will point to startups raising multiple seed rounds often calle

77、d Series A-,seed-plus or seed extensions driving the activity.That may be true,given that 30%to 36%of US fintechs that raised their initial seed between 2015 and 2020 went on to raise another seed round.But thats not the main culprit.Even with the glut of seed rounds,US fintech seed rounds are on pa

78、ce to fall 24%YoY in 2024,and 55%relative to the peak in 2022.Those numbers deteriorate another 5%for startups raising their first seed round.Despite the drop off,the backlog of seeds will take years to shake out and continue to have lasting impacts on Series A.Startups opting to raise multiple seed

79、 rounds in lieu of a Series A or delaying a Series A as they struggle to grow into a once promising valuation have depressed graduation rates and pushed the ratio of seed deals per Series A deals to new heights.Notes:1)Fintech defined using SVB proprietary taxonomy.Source:SVB proprietary taxonomy,Pi

80、tchBook Data,Inc.and SVB analysis.Number of unique US fintechs raising first seedShare of US fintechs raising multiple seedsFUTURE OF FINTECH 20241430%29%33%35%36%33%27%18%11%5%2941751892043143753006497474012092015201620172018201920202021202220232024Of the 747 US fintech startups that raised their f

81、irst seed in 2022,18%have raised an additional seed0.0 x0.5x1.0 x1.5x2.0 x2.5x3.0 x3.5x4.0 x201020112012201320142015201620172018201920202021202220232024Seeds per A:FintechAs per B:FintechSeeds per A:OverallAs per B:Overall0%5%10%15%20%25%30%35%40%45%The boom times following the onset of the pandemic

82、 brought capital excess and lofty expectations.But yesterdays market is not todays market.Fintech startups,now pegged with higher-than-justified valuations,need to clear a higher bar to move on to the next round.Capital is no longer a commodity,and activity has declined,forcing many startups to cut

83、costs at the expense of growth(a key metric for Series A investors).Add in startups opting to raise another seed round and you have the Series A crunch,which has led to drastically falling graduation rates.For US fintechs that raised their seed round in 2019 or 2021,nearly 15%had graduated to Series

84、 A within 18 months.That figure for 2022 and 2023?Barely 5%.However,change may be on the horizon.In our conversations with investors,there is a growing sense that the gap between seed and Series A valuations has narrowed.This changes the risk/reward calculation,making Series A more attractive.Some a

85、rgue that the difference in an outcome between seed and Series A is marginal.Where graduation rates end up is anyones guess.It will likely take some time for the oversupply of seed companies to either fail or meet the necessary metrics for a Series A round.Until then,graduation rates may stay on the

86、 current path.Notes:1)Fintech defined using SVB proprietary taxonomy.Sources:SVB proprietary taxonomy,PitchBook Data,Inc.and SVB analysis.0%10%20%30%0612182430360%5%10%15%20%25%30%35%40%Dec 16Jun 17Dec 17Jun 18Dec 18Jun 19Dec 19Jun 20Dec 20Jun 21Dec 21Jun 22Dec 22Jun 23Dec 23Jun 24Cumulative Graduat

87、ion Rate by YearMonths to GraduateWithin 1 YearsWithin 1.5 YearsWithin 2 YearsWithin 3 YearsBlockchain and CryptocurrencyPaymentsFinancial B2B SoftwareAlternative LendingPersonal Finance and Wealth ManagementBanking and Capital Markets/Fintech InfrastructureInsurance TechReal Estate2016-20182017-201

88、92018-20202019-202120192020202120222023FUTURE OF FINTECH 20241520%of startups that raised a seed in 2020 graduated to Series A within 18 months.That figure has dropped to single digits for 2022/2023 seed cohorts.1.2x1.1x1.2x1.5x1.3x1.5x2.9x2.7x2.9x4.8x3.7x3.7x9.7x9.6x8.9x15.7x12.5x7.4x20192020202120

89、2220232024Companies may not be able to raise new funding rounds,but theyre not sitting idly by.Founders are diligently improving the bottom line through efficiencies.Nearly 80%of fintech companies have improving earnings before interest,taxes,depreciation and amortization(EBITDA)margins YoY,a vast i

90、mprovement from the low in Q2 2022.Burn rates,a key measure of efficient growth,are also improving.While the median burn rate for US fintechs matches last years rate of 3.7x,burn rates for startups in the top quartile have fallen 41%since last year and over 50%since 2022,when the market shift began.

91、Efficiency is not only about improving your unit economics,which should please investors,but also extending your cash runway in hopes of surviving the current recalibration period and potentially raising another round or to potentially exit at a more favorable price.Still,margins are still negative

92、and are eating at runway for those that havent raised more funding.Nearly 30%of US fintechs now have 6-12 months of runway left,up from 20%last year.The trend skews lower for companies with less revenue.Those with under$10M in revenue now have a median of 10 months of runway,down from 12 months last

93、 year.Some of these companies have a path to future rounds,but others are the walking dead,with no real path to profitability or exit.FUTURE OF FINTECH 202416Notes:1)Fintech defined using SVB proprietary taxonomy.2)Median as of Q4 of respective year.Sources:PitchBook Data,Inc.,SVB proprietary data a

94、nd SVB analysis.-200%-180%-160%-140%-120%-100%-80%-60%-40%-20%0%0%10%20%30%40%50%60%70%80%90%100%Q1 19Q2 19Q3 19Q4 19Q1 20Q2 20Q3 20Q4 20Q1 21Q2 21Q3 21Q4 21Q1 22Q2 22Q3 22Q4 22Q1 23Q2 23Q3 23Q4 23Q1 24Q2 24Median EBITDA marginShare with improving EBITDA marginsMedian burn multiple25th to 75th perce

95、ntile burn multiples0%5%10%15%20%25%30%35%$25M$3M$33MPrice negotiation3.0 x3.3x3.5x2.8x2.5x3.4x4.5x3.8x3.8x4.0 x20202021202220232024Year of VC Deal2010-192020-24Companies founded:ExpectationsInnovation TriggerPeak ExpectationsDisillusionmentSlope of EnlightenmentPlateau of ProductivityPlateau will b

96、e reached in:0-2 years2-5 years5-10 yearsMore than 10 yearsRisk AssessmentRobo-AdvisorsFraud-Detection Customer ChatbotsAI AssistantsAlgorithmic TradingApplication:Vertical:Finance-specific use,not broadly applicable to other sectors Horizontal:Non-industry specific use,broadly applicable.Underwriti

97、ngData AnalyticsRegulatory ComplianceMarket PredictionP2P LendingNLPCounterfeit Detection Estate PlanningRetirement PlanningPersonalized MarketingCyberattack PreventionDeal NegotiationMarket IntelligencePersonalized Wealth AdvisorsProperty valuationDecentralized bankingLead GenerationVC InvestingFUT

98、URE OF FINTECH 202418Treasury ManagementAging unicorns grow restless in the stable.19FUTURE OF FINTECH 2024$0$100B$200B$300B$400B$500B$0$5B$10B$15B$20B$25B061218243036424885%32%Notes:1)Fintech subsectors based on SVB taxonomy.2)Latest financials through Q2 2024 from 35 formerly VC-backed public fint

99、echs.3)Includes unicorns formed through 9/26/2024.Sources:PitchBook Data Inc.and SVB analysis.Real EstateBanking/Capital MarketsPersonal FinancePaymentsAlternative LendingFinancial B2B SoftwareInsuranceBlockchain and CryptoShare of fintech unicorn valueMonths since last valuationCompany valuationCum

100、ulative valuationFUTURE OF FINTECH 2024208.8x4.4x3.9x3.8x3.0 x1.3xBanking/CapitalMarketsPaymentsFinancialB2BSoftwareLendingReal Estate Insurance$16B$11B$16B$41B$88B$69B$44B$155BOct 2022Oct 2023Oct 2024Financial B2B SoftwarePaymentsAlternative LendingPersonal FinanceInsurance TechBanking/Capital Mark

101、etsReal EstateBlockchain/Crypto17%10%15%10%7%22%40%57%Share of valuation last valued within 18 months Total valuation of active unicornsWhats a fintech unicorn to do?In the funding bonanza of 202122,achieving unicorn status became a rite of passage more than a measurement of value for many companies

102、.Nearly 80 US fintech companies achieved a valuation of$1B or higher during the VC boom,with about 65%of these companies just squeaking over the line with a valuation under$1.5B.In total,114 fintech unicorn companies are now active in the US,with a cumulative last known value approaching$440B,equiva

103、lent to the annual GDP of Minnesota.But with revenue growth slowing and valuation multiples on the decline,most fintech unicorns are likely worth far less than their last valued round.Since 2021,formerly public fintechs have seen significant declines in revenue multiples,with financial business proc

104、ess software falling from an average of 25x in October 2021 to 4x in October 2024.Only about a quarter of current aggregated unicorn value has been tested in a deal within the last two years.Now,those inflated valuations are weighing down many companies eyeing an exit.“Billion-dollar buyers are scar

105、ce,and for those that are interested in acquisitions,there is a wide spread between the bid and the ask,”said Emily Man,Partner at Primary VC.That leaves only one viable path for false unicorns.“At the end of the day,if I raised at the peak,I probably still have a couple years of runway.Why would I

106、take a big hit on valuation when I could keep growing and see if I can grow into it?”28%$70B99%Fintech unicorns have a cumulative value of$460B,but only a third of that sum has been valued within the last two years.A hot streak of acquisitions last year may have been a flash in the pan as the exit m

107、arket has turned colder this year.Exits are down 15%from 2023.The deals that are happening tend to carry signs of distress.Only 15%of M&A deals have disclosed amounts,down from 27%in 2021,a sign that deal terms tend to favor buyers rather than sellers or investors.Exits are growing scarce relative t

108、o later-stage deals.There are just 2.7 exits per 10 late-stage deals this year,down from 3.9 exits per 10 late-stage deals in 2021.Additionally,buyouts grew as a share of exits in 2023 but have now receded,a further sign of reduced liquidity in this risk-off environment.The gap between the best perf

109、orming companies and the rest is widening,in some cases giving rise to conflicts of interest between those on the cap table.“Some funders and founders are open to restructuring cap tables while others are holding on tightly to their liquidation preferences.”said Victoria Zuo,principal at QED Investo

110、rs.In one positive sign,Ibotta,a consumer fintech that delivers digital promotions to consumers,completed an IPO in April,raising$200M.The company slashed expenses last year in preparation to go public.Such a performance might make way for other future exits.Notes:1)Data through 9/30/2024.Buyout/LBO

111、 deals are not disclosed.2)Deal values for disclosed deals only.The majority of M&A deals are not disclosed.Sources:PitchBook Data,Inc.and SVB analysis.$0B$10B$20B$30B$40B$50B05010015020025020152016201720182019202020212022202320244.33.33.84.63.53.43.93.03.52.72015201620172018201920202021202220232024

112、0 x2x4x6x8x2015201620172018201920202021202220232024Deal Value to Dollars Raised$405M$419M$427M$500M$930M$2.7BCapital RaisedExit ValuationIPOSellers MarketBuyers Market74%78%81%78%79%75%73%77%85%85%UndisclosedDeal TermsDealsFUTURE OF FINTECH 202421Exit ValueBuyout/LBOM&APublic ExitNick ChristianHead

113、of National Fintech and Specialty FNick is the leader of the national Fintech and Specialty Finance practice,working closely with CEOs,CFOs and venture capitalists to support growth in the fintech sector through innovative financing,banking solutions,industry insight and advice.Nick joined SVB in 20

114、08.Josh PherigoSr.Analytics ResearcherSVB Market IBrian is a market manager in SVBs national Fintech practice,leading both relationship management and warehouse lending for fintech clients.Brian joined SVB in 2019 and has over 20 years experience structuring and executing warehouse asset-based secur

115、ities.Brian FoleyMarket Manager,Fintech and Warehouse LNoah GrubmanSenior Vice President,FJoseph SmartManaging Director,FJoe FranzoneDirector,FArianne PerryManaging Director,Investor Coverage and Business DAnjalika KomatireddyAnalytics ResearcherSVB Market IJake LedbetterSr.Analytics ResearcherSVB M

116、arket IAndrew PardoSr.Analytics ResearcherSVB Market IFUTURE OF FINTECH 202422Silicon Valley Bank(SVB),a division of First-Citizens Bank,is the bank of some of the worlds most innovative companies and investors.SVB provides commercial and private banking to individuals and companies in the technolog

117、y,life science and healthcare,private equity,venture capital and premium wine industries.SVB operates in centers of innovation throughout the United States,serving the unique needs of its dynamic clients with deep sector expertise,insights and connections.SVBs parent company,First Citizens BancShare

118、s,Inc.(NASDAQ:FCNCA),is a top 20 U.S.financial institution with more than$200 billion in assets.First Citizens Bank,Member FDIC.Learn more at .Silicon Valley B See complete disclaimers on following page.2024 First-Citizens Bank&Trust Company.Silicon Valley Bank,a division of First-Citizens Bank&Trus

119、t Company.Member FDIC.3003 Tasman Drive,Santa Clara,CA 95054 23FUTURE OF FINTECH 202423The views expressed in this report are solely those of the authors and do not necessarily reflect the views of SVB.This material,including without limitation to the statistical information herein,is provided for i

120、nformational purposes only.The material is based in part on information from third-party sources that we believe to be reliable but which has not been independently verified by us,and,as such,we do not represent the information is accurate or complete.The information should not be viewed as tax,acco

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122、 to acquire or dispose of any investment,or to engage in any other transaction.All non-SVB named companies listed throughout this document,as represented with the various statistical,thoughts,analysis and insights shared in this document,are independent third parties and are not affiliated with Sili

123、con Valley Bank,division of First-Citizens Bank&Trust Company.Any predictions are based on subjective assessments and assumptions.Accordingly,any predictions,projections or analysis should not be viewed as factual and should not be relied upon as an accurate prediction of future results.Investment P

124、roducts:Are not insured by the FDIC or any other federal government agencyAre not deposits of or guaranteed by a bankMay lose value2024 First-Citizens Bank&Trust Company.Silicon Valley Bank,a division of First-Citizens Bank&Trust Company.Member FDIC.3003 Tasman Drive,Santa Clara,CA 9505424FUTURE OF FINTECH 202424