Europe bucks the fintech slowdown

The two fintechs that announced megarounds Wednesday hailed from Europe.

Driving the news: Modulr, an embedded payments company based out of London raised $108 million (£83 million) in Series C funding. Thought Machine — also headquartered in the U.K. — raised $160 million in Series D funding valuing it at $2.7 billion.

Why it matters: While funding to fintech companies around the world dropped in the first quarter, Europe continued to grow.

By the numbers: European fintechs raised $7.9 billion in the first quarter, up 39% compared to the previous quarter, according to CBInsights. But Global fintech funding fell 18%.

• Europe, for the first time ever, also outpaced Asia last quarter for the most total fintech unicorns (though still putting it in second place overall behind the U.S.)

Of note: It’s not just the European ties that set Modulr and Thought Machine apart — they are also pick-and-shovels plays. Modulr gives other companies the ability to embed payments into their services. Thought Machine sells banking software.

Details: General Atlantic led the round in Modulr, with participation from others, including Blenheim Chalcot, Frog Capital, Highland Europe, and PayPal Ventures.

• Temasek led the round in Thought Machine.

Thought bubble: Funding in Europe has continued in part because the U.S. — the world's most well-funded market — has become overly saturated.

• But that raises the question: Is Europe simply lagging behind the wider fintech selloff?
• General Atlantic's co-head of financial services, Aaron Goldman, certainly thinks so. "The U.S. and Europe will probably begin the move in lockstep," he tells Lucinda. "The exit opportunities are in the U.S."