Global Fintech M&A rose sharply in the first half of 2022, as deals now take place at discounted prices
Tech M&A and corporate finance advisory firm Hampleton Partners registered 591 M&A fintech deals in H1 2022. That is a 46% increase on H1 2021, and a massive 70% increase compared to H1 2019 pre-pandemic figures.
At the same time, deal valuations remained steady. The first quarter of 2022 saw the trailing 30-month median revenue multiple at 3.1x. That goes in line with the levels seen in the past two years.
Although the global M&A figures slowed down, fintech remains attractive for dealmakers as their pockets are full whereas high-growth fintech companies are being sold at all-time affordable prices.
A particularly significant jump in the number of deals in the past 12 months was observed in the crypto and blockchain segment. It recorded a total of 107 transactions, a 75% growth year-over-year.
Open banking also witnessed enhanced M&A activity. Moreover, the number of users is expected to increase fivefold to 64 million consumers by 2024. In addition, the embedded finance sector is on the rise, with transaction values expected to hit $7.2 trillion by 2030.
Overall, Hampleton Partners believe M&A activity in the fintech sector will further increase. To begin with, many private fintech companies run out of money needed to fuel and maintain their operations. Therefore, they consider selling their business. Meanwhile, public companies and PE with massive capital, as well as late-stage high-growth private companies and traditional financial services companies are on the lookout for fintech innovations at a lower cost.
M&A top 10 global financial advisers by deal value
Fintech startups account for less than a fifth of all VC funding