Over the last few years or so, financial technology or fintech have become one of the most rapidly growing sectors in the tech industry. Fintech is any startup or company that is focused on solving various problems associated with the finance industry utilizing modern technology. It includes almost everything from money transfer to insurance brokering.
Early stage investments in the financial technology are also on the rise. According to a report from global management consulting company Accenture, investments in fintech startups registered an exponential increase of 2,200% from about $930 million to $22 billion in 2015.
If we take out a couple of big names, most of the fintech companies are small and don’t have the needed exposure, but this is about to change real soon. Anyway, here are the 15 biggest and most valuable fintech companies from all around the world. And one more thing, we haven’t added online payment giant Paypal despite of its near $100 billion valuation to stop stating the obvious.
Valuation: Around $800 million
Betterment is a U.S based registered online investment firm that provides its customers with goal based investing services and financial advices. Back in 2016, the company was valued at $700 million, but a recent investment by a Swedish investment company, Kinnevik worth $70 million bought firm’s valuation to $800 million. Betterment currently has about $10 billion assets under management.
Moreover the company employs specialized algorithms to provide personalized financial advice. They also have advisers to provide consultations over the phone. They offer a wide range of services, from taxable asset location services to simple retirement accounts.
14. Funding Circle
Valuation: $1.2 billion
Funding Circle is one of UK’s leading fintech companies that allow investors to lend money to small and medium scale firms. It works on peer-to peer model. Launched in 2010, it quickly acquired £12.5 million in funding from different venture firms. Then in 2013, further $37 million was pumped into the company by Accel Partners and other big names.
Recently, according to a report published by sky news, the company has plans to go public soon and this move can possibly double its current valuation. By mid 2016, the company had already facilitated over £3.4 billion in loans.
Valuation: $1.3 billion
Kabbage, Inc. is a venture funded online money lending company that provides funds to small scale business. With a maximum lending amount of $250,000, Kabbage identifies suitable customers based on factors including appropriate annual revenue, business maturity, social media activity, etc.
Kabbage has raised funds from several big venture capitals like Reverence Capital Partners, Thomvest Ventures and Softbank Capital over multiple series of funding. It also debt funded by Victory Park Capital. In 2017, the company received fresh $250 million investment from Softbank.
At the moment, the company has more than 130,000 customers and extended $4 billion in loan amount.
Valuation: $1.6 billion
TransferWise is one of Europe’s fastest growing financial technology company that helps its customers with its peer-to-peer money transferring service worldwide. As a startup, TransferWise received its seed funding of around $1.3 million from a consortium and several individual investors as well.
In 2013, Peter Thiel’s Valar Ventures led a $6 million investment round. Over the next three years, the company raised a total of $109 million from famous investors such as Richard Branson and Andreessen Horowitz. Last year, the company raised another $280 million with plans to expand to Asian markets.
Valuation: $2 billion+
Cryptocurrency boom in 2017 turned out to be turning point of the biggest digital currency exchange. For those who don’t know Coinbase, it allows users to trade popular digital currencies like Bitcoin and Ethereum. Since its establishment, Coinbase has raised over $217 million in funding.
According to Recode, last year the company achieved $1 billion in revenue boosting its previous valuations. Well, there is no doubt that the fate of the company is totally depending on the future of digital currencies, but the real question here is how far it can go unchallenged?
Valuation: $2 billion
Avant, formerly AvantCredit, is a personal loan providing company that uses machine learning to evaluate borrower’s credit worthiness and to establish interest rates. Launched in 2012, the company has since raised almost 1.8 billion in debt and investments. Back in 2015, the company was raked #6 on Forbes America’s Most Promising Companies.
Valuation: $2.5 billion
Klarna is a Sweden based banking company that provides payment solutions to merchants and business, including credit payment and debt collection services. The company was founded by Niklas Adalberth, Sebastian Siemiatkowski and Victor Jacobsson back in 2005 after pondering on the idea of providing merchants and consumers with much simpler and safer payment methods.
In 2007, the company received their first investment capital from a Swedish investment company called AB Öresund. Within the next 2-3 years, Sequoia Capital and General Atlantic joined the funding round, while Klarna expanded its geographical reach to other European nations. In 2014, Klarna handled online sales worth of $10 billion.
Recently they picked up a full banking license, which enables them to expand their business to other spheres of the banking world.
8. Credit Karma
Valuation: $3.5 billion
Credit Karma is one of the fastest growing personal finance company founded more than a decade ago. Though the company is known for financial management and free credit platform, it also provides services like free tax preparation and tools to identify credit report errors.
In 2013, the company closed $30 million investments led by Susquehanna Growth Equity. The next year in a funding series led by Google Capital, Credit Karma raised $85 million. The company raised $175 million from existing and new investors at a valuation of $3.5 billion in 2015.
Valuation: $4.4 billion
SoFi or Social Finance is an online personal finance company that mainly focuses on student loan refinancing along with personal loans and mortgage. From 2012 to 2014 SoFi raised more than $650 million in debt financing and equity from Morgan Stanley, Baseline Ventures and others.
By mid 2016 the company had already facilitated over $2 billion in loans, including mortgages and loan refinancing. The same year SoFi became the first online lender to receive AAA ratings from Moody’s.
Valuation: $4.5 billion
GreenSky is leading financial technology company that provides loans to individuals and small to medium sized business. Unlike other online lending companies, GreenSky is linked with banks and other financial institution to finance the loans. GreenSky closed its first major investment capital of $50 million in 2016.
In early 2018, the Pacific Investment Management invested about $200 million into the company valuing it at about $4.5 billion. GreenSky has recently filed for an IPO.
Valuation: $5.6 billion
Financial services company Robinhood allows customers to invest in publicly traded companies and ETFs (exchange traded funds) listed in the U.S stock exchange without paying hefty commissions. The company in-turn makes money from margin lending and cash balancing process. In a recent funding round, led by DST Global, the company raised about $350 million at a valuation of $5.6 billion.
The service is popular among young people, who admire the hassle free stock trading without commissions or fees. Earlier in January (2018) the company announced that they are about to add a crypto trading option.
Valuation: $8.5 billion
MarketAxess is a leading global fintech company that provides advanced electronic trading platform for institutional bond markets. The company enables big investors and brokers to trade corporate bonds and all other types of securities. It also provides Open Trading, offering new trading opportunities in high-yield markets.
Valuation: $9.2 billion
Stripe is a payment processing company founded in 2011 that enables both individuals and businesses to accept payments online. As a startup, Stripe received $2 million as an investment from Peter Thiel and Sequoia Capital, then further $18 million led by Sequoia Capital at a valuation of $100 million.
The company reached its current valuation after successfully completing a $150 million funding round in late 2016. Its quick rise to being one of the most favored online payment company can be attributed to its technological supremacy over its competitors including a machine learning based fraud detection system.
Valuation: $16.5 billion+
Jack Dorsey co-founded Square, Inc. after he left Twitter in 2009. Now, nine years later, with a valuation of more than 16.5 billion, Square is worth more than Twitter. During its initial years, Square received angel investments from Biz Stone, Marissa Mayer and Kevin Rose and series funding from big names such as Sequoia Capital and Goldman Sachs. Since its initial public offering in 2015, Square’s valuation has increased four fold.
1. Ant Financial
Valuation: $60 billion
Ant Financial is without a doubt the biggest fintech company in the world. Originally a subsidiary of Alibaba Group, the Ant Financial owns Alipay, the largest mobile payment platform, Yu’e Bao, world’s biggest money-market fund and also a private credit rating system known as Sesame Credit.
The company was founded after Alipay was re-branded as Ant Financial Services in 2014. The next year the company successfully raised a hefty $6.5 billion investment capital from China Investment Corp and other local institutional investors. By early 2017, Ant Financial reached $60 billion valuation.
Many analysts believe that the company may even reach $100 billion valuation within a couple of years, if that happens Ant Financial will worth more than the market capitalization of some of the biggest banks in the world.