STATUS OF THE CANADIAN FINTECH LANDSCAPE · STATUS OF THE CANADIAN FINTECH LANDSCAPE (and beyond)...
Transcript of STATUS OF THE CANADIAN FINTECH LANDSCAPE · STATUS OF THE CANADIAN FINTECH LANDSCAPE (and beyond)...
STATUS OF THE CANADIAN
FINTECH LANDSCAPE
(and beyond)
David Nault
Co-Founder, General Partner
2
Every
category of
financial services
is being
re-imagined
by nimble teams using modern technology
New Canadian Fintech Companies On the Rise
Source: Luge Capital, Crunchbase & AngelList (2018)
Payments
Vertical
Vertical
Share
Blockchain & Crypto
Lending & Mortgage
Insurance Tech
Wealth Tech
Personal Finance
Digital Banking & Infrastructure
Capital Markets
Other
13%
13%
13%
10%
10%
7%
6%
5%
23%
59% of fintechs are in
the top five verticals
100
4
More than 600 Fintech Companies in Canada
Source: Luge Capital (2018), Crunchbase, Hockeystick, AngelList, EY Report
600+
Fintechs
4 000+
Fintechs
1 600+
Fintechs
5
FinTech Funding Across Canada
Where Investors are Betting on Fintech
$600M Canadian Fintech Venture Investments in 2018
Note: In 2017, three companies
raised an aggregate $244M
31
72
59
75 new
Investments
19
As of Q
3: $500M
~ $500M invested to date in
2018 and projected to reach
$600M by end of 2018
Estimated
Source: Luge Capital, Crunchbase, AngelList & CVCA
7
In 2018, U.S. Investors Invested ~20x More Capital
Compared to Canada
Source: KPMG Pulse of Fintech H1 2018 Report
Fintech venture
investments in the U.S.
reached ~ C$6.7B in
the first half of 2018
~ C$10B
by end of 2018
As of Q
2: $
6.7
B8
CB-Insights_Fintech-Trends-2019
Global Fintech Investments Tops $39B in 2018
Annual Global Deals and Financing, 2014-2018 ($B)
Canadian Fintech Investments of $1.7B+ Since 2014
Source: Luge Capital and Crunchbase (2018)
# of Investments
by Stage
$ Invested
by Stage
Series A
Series B+
Pre-Seed and Seed
Series B
63.5%
21.0%
7.7%
7.7%
10.8%
33.4%
26.0%
29.8%
170+
companies$1.7B+
10
Canadian Fintech Investors
FinTech focused investors: ~$600M+ Other investors with investments in FinTech: ~ 4B+
Source: CVCA and Reseau Capital
Notable Fintech Financing in 2018
$1M
$400K+
$1M
$1.75M
$2.5M
$600K
$1.1M
$2.25M
$8M
$2.3M
$975K
$3M
Seed
$57.8M
$5.4M
$6.6M
$9M
$14.3M
$6.5M
$8.4M
$14M $25.8M
Series A
$105.2M
$23M
$10.1M
$12M
$36M
$62M
Series B
$153.6M
Source: Crunchbase, CVCA
$12M
12
Fintech M&A in 2017-2018 of Over $5.8B
* Estimated
** Majority stake acquired
$4.8B
$400M+
+
+
$302M +
$100M
$200M+*
+
+
$70M
Undisclosed
+
+
Undisclosed**+
Source: CVCA
13
FIs Supporting the Fintech Ecosystem
Ventures Ventures
Digital Garage
and Insurtech
Accelerator
program
FinTech Accelerator program
14
Recent Incumbent + Fintech Partnership Examples
15
Create Guide
Support Collaborate
CSA Regulatory
Sandbox
Unite
FinTech Summit
AMF Fin
Tech Lab
Canadian Fintech Ecosystem Collaboration
Animating the fintech
ecosystem
Adapting our regulatory
environment
Creating support for
entrepreneurs
Increasing capital for
fintechs
How is fintech
being applied?
17
Money Remittance:
• $4 billion/ month
• 4M customers
• $8 million in profit
Consumer/ POS Lending:
• 40% of all e-commerce sales in Sweden
• 2000 employees
• Funded $21 billion in online sales
Credit Scoring:
• $368M in funding
• >$500M revenue
• 700 employees
Data Aggregation/
Credit score
• Used by >115
Fintechs
Process Automation:
• AI and ML to reduce manual
processes
• $50M in fundingReinventing Banking:
• 3 years old. $1.7B valuation
• 3M accounts
• $250M in funding
• 630 employees
Accounting Automation + AI:
• $25M in funding
• 300 employees
• Used by > 1,000
Accounts payable/ receivable
automation
400M
users
=> Ant Financial leads the development of the first financial blockchain standard for IEEE
600M
users
“Dear finance professionals…
the times, they are a changing…”
• You will want to understand how technology can be used, so that you can apply it to your
job and be part of this transformation process.
• Finance professionals will need to train fintech software and work on more complex or
strategic issues.
• Automation will significantly reduce administrative tasks. You will continue to have an
important role in the relationship with clients, but will be increasingly assisted by more
digital tools.
• As alternate currencies and blockchain technologies become increasingly integrated into
the finance industry, there will be a greater need for roles in security fields like encryption,
identity protection, risk and compliance.
• Roles will require personnel having strong soft skills — like personal attention and empathy
— that cannot be replicated (yet!) by machines
• Fintechs need professionals that understand financials services are in-demand
22
About Luge Capital: $75 Million Fund
Investing in early-stage fintech companies and AI solutions applied to
financial services
23
Our investors and partners:
Our areas of interest:
Thank you / Merci
@LugeCapital
www.luge.vc
Building Fintech Champions
Read our blog that summarizes this presentation.
No part of this document may be reproduced without the prior written permission of Luge Capital.