German fintechs are booming: 1.2 billion euros in the first half of the year!

German fintechs are booming: 1.2 billion euros in the first half of the year!

German fintechs and insurtechs received a total of impressive 1.2 billion euros from investors in the first half of 2023. This new round of funding has further spurred interest in financial start-ups. Loud Payments and Banking 19 financing rounds were recorded in Fintechs and two in Insurtechs during this period, underlining the dynamism and growth of the sector.

The average funding per start-up was 20 million euros, while the lowest funding was 3.1 million euros. Particularly noteworthy was the largest financing commitment of 500 million euros to the Berlin fintech Bees & Bears in January. These funds are to be used to finance installment loans for sustainable energy solutions such as heat pumps and wallboxes and come from an as yet unknown listed bank from the DACH region.

Significant financing rounds

Another outstanding event in the financing sector was the round in which Scalable Capital raised 155 million euros in June from renowned investors such as Sofina, Noteus Partners and Balderton Capital. Solaris, another prominent fintech, raised €140 million from SBI Group and Boerse Stuttgart Group in February, although the company's overall valuation fell to €90 million.

An interesting trend in financing can also be seen in the concentration of investors on certain market segments. Loan start-ups such as Neoshare and Bees & Bears as well as payment start-ups such as Nelly Solutions and Circula in particular increased their interest. Overall, most financing rounds took place in June, followed by equal rounds in January, April and May.

Mergers and Acquisitions

In the area of ​​mergers and acquisitions, ten exits were reported in the first half of the year. Well-known examples include the sale of Alphalink to xPortal and the takeover of Fincompare by its competitor Compeon. In March, IDnow was sold to Corsair for $300 million. These developments show not only the growth, but also the increasing competition between start-ups in the financial sector.

There were also four mergers, including the merger of Fincite and Harvest to form Harvest Group, as well as the merger of Billwerk+, Plenigo and Sofacto to form the Frisbii platform. These mergers could impact the market structure in the long term and increase pressure on smaller players.

Committee procedures and market conditions

In parallel to these developments, BaFin opened preliminary insolvency proceedings against the Insurtech Element in January, which finally became insolvent in March. This shows that despite the overall positive trend in the fintech sector, there are also challenges and risks that need to be taken into account.

Given the multitude of new fintechs and insurtechs, it is crucial for aspiring entrepreneurs to start searching for potential investors early. Loud Founder platform It can take months for funds to flow, and approaching multiple donors helps to strengthen your negotiating position.

In summary, the first half of 2023 has brought significant progress for German fintechs and insurtechs, both in terms of financing and in the dynamics of mergers and acquisitions, with companies and investors well advised to closely monitor the changing market conditions.