Fintech financing is bucking the downward trend across Europe

editorial

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While European startup funding stalled in the third quarter of 2024, with startups raising a total of $11.3 billion – a 35% decline compared to the same period last year – the fintech industry bucked this trend and rebounded in 2023 a downturn.

Funding for fintech startups increased 45% year-over-year in the third quarter of 2024, reaching $1.6 billion.

AI technologies continue to be a driving force in the European startup landscape. Generative AI in particular has attracted a lot of interest from investors, with $165 million raised across all sectors in the third quarter. GenAI companies have raised a total of $3.3 billion so far this year, representing 8% of total European VC funding.

Despite a decline in late-stage investments, early-stage and breakout-stage deals have remained stable in 2024. With an expected dry powder volume of $33 billion by year-end, the ecosystem is poised for further momentum in 2025.

Remus Brett, General Partner at LocalGlobe and Latitude, comments: “Europe’s fintech sector is back in full swing, as these funding figures confirm. Fintech startups, most of which are now AI-first, are further accelerating B2C and B2B innovation and opening up more opportunities here.” Additionally, the emergence of purebred fintech companies with over $100 million in annual revenue is driving this “Promotes growth, creates jobs and changes the landscape.”