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Fintech funding hits lowest quarterly figure since 2017

Data: CB Insights; Chart: Axios Visuals

Venture capital dollars committed to fintech companies dropped to the lowest quarterly level in seven years, data from CB Insights shows.

Why it matters: Venture investors have been optimistic over dealmaking this year, but the numbers suggest it's been less rosy for a significant swath of founders.

Driving the news: The number of venture deals ticked upward by 15% in the first quarter, to 904, compared with the prior quarter, while total dollar value dropped 16%, to $7.3 billion.

  • That's the lowest quarterly dollar figure since the first quarter of 2017, when 729 companies raised $5 billion.
  • Early-stage dealmaking remaining elevated, but later-stage businesses have also been raising modest amounts of capital, coupled with flat or lower valuations.
  • Early-stage rounds have made up 70% of deals this year, compared with 73% in 2023.

The big picture: There's good reason for the optimism. More companies are posting profitability, consumer sentiment is rising, exits are returning, and interest rates have normalized.

  • But that optimism is less about fintech dealmaking returning to all-time highs, and more about more profitable business models emerging and about company valuations coming down to earth.

The bottom line: Not everyone gets to be optimistic.

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