Fintech funding in 2026: what investors now require of growth-stage CEOs

KPMG's Pulse of Fintech for the second half of 2025 shows total global fintech-focused investment rising from $95.5 billion in 2024 to $116 billion in 2025. Within the year, the first half saw $59.7 billion across 2,550 deals and the second half $56.3 billion across 2,169 deals. The value of capital deployed is higher than a year ago, which is encouraging for any CEO preparing a round.

The count of deals tells a different story. KPMG records 4,719 deals in 2025, an eight-year low. A rising total with a falling number of transactions means larger average cheques going to fewer companies. In plain terms, the market has become more concentrated: investors are making fewer bets and sizing each more heavily, while a long tail of businesses finds it harder to raise at all.

CB Insights data, reported by Crowdfund Insider, tell a related story with a different total. It records global investment dipping 12% to $105.9 billion, with quarterly funding stabilising around $10-11 billion and mega-rounds accounting for up to 40% of capital. The direction of change differs from KPMG's, which we address in a later section, but both agree on the main point: funding is concentrated in a smaller group of larger rounds.

The implication for a growth-stage CEO is that average market statistics may flatter your position. An aggregate rise driven by a handful of very large deals says little about whether a $20 million round is easier to raise this year. What to do: benchmark yourself against rounds of your own size and stage, using deal-level data from your advisers, and set the timetable for your process on that basis.

Another point from the numbers is that the half-year split shows no sign of acceleration: the second half was slightly lower in value than the first. Do not assume that conditions will improve by waiting. Where your metrics are strong now, the case for starting a process is stronger than the case for delay.

Consider also what a concentrated market does to the timing of a process. When capital is clustered in fewer, larger rounds, lead investors have more power to set terms and more reason to move slowly on companies that do not fit their thesis. A CEO who approaches the wrong ten funds may use up goodwill and signal weakness. Time the first meetings around a proof point, such as a quarter of improved margins, a new licence or a major customer win, because investors respond to momentum they can see in the numbers.

KPMG finds investment in AI-driven fintech companies rose from $12.1 billion to $16.8 billion, while digital assets nearly doubled from $11.2 billion to $19.1 billion. Corporate VC-participating activity reached $29.7 billion, up from $20.9 billion. These categories drove much of the increase, and CEOs outside them should expect more questions on why their product deserves capital.

PitchBook's Q4 2025 Fintech VC Trends provides the valuation view for US venture. It records $42.8 billion of VC deal value across 2,126 deals in 2025, a median pre-money valuation of $37.3 million, up 34.9% from $27.7 million in 2024, and a late-stage median of $64 million, up from $57.5 million. AI-enabled US fintech startups showed a 17.8% higher median pre-money valuation than non-AI peers.

Those premiums carry a requirement. An AI label alone does not justify a higher price; investors are asking whether AI measurably lowers cost to serve, improves credit or fraud outcomes, or increases revenue per customer. Be ready to show the metric before and after the technology was deployed, and the operating evidence that the improvement is repeatable and not a one-off.

The message from private equity is less encouraging. KPMG records PE growth funding falling from $5.5 billion across 137 deals in 2024 to $4 billion across 114 deals in 2025. Growth-equity investors are more cautious about paying for growth alone and favour companies with a visible path to cash generation. For a company seeking a minority growth investment, expect a more demanding review of margins and capital efficiency than in 2021.

What to do: position the business in a category that investors are actively funding, and be precise about which one. Fintechs that sit between categories, such as a lender with a data product, should lead with the segment where the evidence is strongest. A focused narrative with measurable proof outperforms a broad platform story that requires investors to take much on trust.

The valuation data also hold a warning about expectations. A median pre-money valuation that rises 34.9% across a year may encourage founders to anchor high, but medians cover very different companies, and the 2025 late-stage figure of $64 million is a reference point for typical rounds, not for strong ones. Use valuation data to understand a range, then let your own growth, margin and retention data position you within it. Investors price what they can verify, and a figure that cannot be backed by evidence will be negotiated down.

A final point concerns timing and sequencing within the year. Many investors set their allocations annually, and appetite for new commitments can differ between the first and second halves. Ask each prospective lead about their pacing and pipeline, so that you do not start a process just as their capacity for new investments is reduced. Understanding where an investor is in its own fund cycle, including its remaining capital to deploy, can explain a slow response and help you plan follow-up appropriately.

KPMG's regional split shows the Americas attracting $66.5 billion across 2,409 deals in 2025, EMEA $29.2 billion across 1,484 deals and ASPAC $9.3 billion across 763 deals. For a CEO outside the United States, the Americas dominance has practical consequences: US funds are the largest pool, but they invest in companies that can demonstrate a route to the US market or an exceptional local position.

In the UK, KPMG reports $10.9 billion across 418 deals in 2025, down from $13.3 billion across 527 deals in 2024. Innovate Finance, using a narrower definition, says global FinTech investment rose 21% to $53bn and the UK reclaimed second place with $3.6 billion, behind the US at $25.1 billion. The UK is fewer deals and lower value on KPMG's basis, but still a leading hub on both.

For European fintechs, Finch Capital's H1 2025 report found that capital invested rose 23% to €3.6bn despite a 32% drop in deal volume, and that AI-based start-ups made up 21% of deal volume. The pattern echoes the global one: more capital, fewer deals. A company in Berlin, Paris or Amsterdam should expect to be compared with the best in Europe and, increasingly, with US competitors.

The Gulf is smaller but growing. KPMG records Middle East fintech investment rising from $741.4 million across 161 deals to $1 billion across 135 deals. Fintech Saudi reports 261 fintech companies in Saudi Arabia, up 21% from 216 in 2024. These are small bases, but supportive regulators and sovereign-linked capital make the Gulf relevant for fintechs seeking regional partners, distribution or a first-close investor with a long-term horizon.

What to do: build the investor map by geography as well as by fund type. For each target region, identify who leads rounds, what regulatory presence they expect and whether a local subsidiary, licence or partnership would be required. A strategic investor in the Gulf may offer distribution value as well as capital, but it will also expect a commitment to the market that needs to be planned and resourced.

A final consideration for companies expanding across borders is the cost of regulation. Each new market usually brings its own licensing, data protection and consumer rules, and investors will ask whether the plan to enter has been costed and staffed. A company that projects fast international growth without a regulatory plan invites scepticism, and one that has secured a licence or a partner in a second market is valued for the evidence that it can do so repeatedly.

BCG's analysis found fintech revenues grew 21% in 2024, up from 13% in 2023 and well ahead of 6% growth in broader financial services. More relevant to fundraising, 69% of scaled fintechs achieved profitability, up from less than half the year before. Scaled fintechs generated roughly $231 billion, or 60%, of industry revenue. The reference group that investors use has therefore shifted toward profitable businesses.

Banking Dive, reporting a later BCG study, says global fintech revenues reached a record $504 billion in 2025, growing 22% and four times as fast as bank revenue. It also notes that the top 20 fintechs account for 40% of overall revenue. Scale and profitability are concentrated, and investors compare mid-sized companies with leaders that already demonstrate that the model works at the largest scale.

The segment mix matters. BCG's breakdown of scaled fintech revenue in 2024 shows about $126 billion from payments, $27 billion from challenger banks and around $16 billion from retail crypto trading and brokerage. A payments business is judged against payments benchmarks, a challenger bank against deposit and lending economics, and a crypto platform against volatility. Investors will want to know which comparison group applies to you, and why.

Profitability is not a binary condition. Investors will accept losses where the unit economics are visibly improving: contribution margin positive by product, payback on customer acquisition shortening, and credit losses or fraud rates inside plan. What they will not accept is a model that needs ever-higher spending to produce the same growth. Show cohort data, not blended averages, since cohorts reveal whether the business is genuinely improving.

What to do: build a one-page profitability bridge from today's results to break-even or to a defined margin, with the assumptions explicit and the sensitivities shown. Include the capital the plan needs and what the company will do if the next round is delayed. A bridge that holds up under challenge is the strongest single document in a data room.

Investors also look at the quality of revenue. In payments, that means take rate resilience and the share of revenue that is recurring rather than volume-driven. In lending, it means credit performance by vintage and the cost of funds. In wealth and trading, it means customer retention through market cycles. Showing revenue quality in the terms the relevant investors use, rather than generic software metrics, demonstrates that management understands the economics of its own sector and has the discipline to report them honestly.

Investors underwrite a round by asking how they will get their money back. Banking Dive reports 42 initial public offerings in fintech in 2025, a 50% increase on the previous year, and M&A volumes rising from $184 billion in 2023 to $251 billion in 2025. KPMG separately records M&A deal value of $55.4 billion in 2025, up from $44.6 billion in 2024.

A more active exit environment supports valuations in two ways. It gives investors confidence that capital can be returned, and it makes strategic acquirers more visible as potential buyers. For the CEO, the practical effect is that investors will ask who your natural acquirers are, what they have paid for comparable companies and how your product fits their roadmap. Having a view prepared, supported by evidence of the strategic relevance of your technology, strengthens your negotiating hand.

There is a limit to this optimism. Exits are concentrated among the largest and most profitable names, and an active IPO market does not mean the window is open to every company. Deal counts are down and investors are selective, so a mid-sized fintech without a clear exit route may find that the financing it needs is available only on terms that protect the investor first, such as structured preferences or ratchets.

Corporate investors play a growing part. KPMG's figure of $29.7 billion for corporate VC-participating activity shows the weight of strategic capital. These investors can offer distribution, data and credibility, but they may also restrict future options, for example through exclusivity or rights of first refusal that deter other acquirers. Terms of this kind should be tested early against your exit strategy.

What to do: write a two-page exit view for your board covering the most likely acquirer groups, the metrics they value and your timetable. Use it to test any term sheet: a clause that reduces the number of credible buyers has a cost, even if the headline valuation is higher.

The route you choose will also determine who sits on your cap table. Strategic investors who later become acquirers can create conflicts when other bidders see them as having inside knowledge. Financial investors with a long horizon may be more patient but will expect governance rights. Think about which combination supports your most likely exit, and negotiate information rights, observer seats and rights of first offer accordingly, with legal advice from the start.

A CEO preparing a round will encounter conflicting statistics. KPMG reports $116 billion of global fintech investment in 2025. CB Insights, via Crowdfund Insider, reports $105.9 billion. Innovate Finance reports $53bn, up 21%. PitchBook records $42.8 billion of fintech VC deal value. Some differences are about scope, such as whether M&A, private equity and corporate investment are included. Others reflect which companies are classed as fintech and how deals are dated.

Mixing these figures in one argument is the commonest error. A board paper that quotes KPMG for the market total and PitchBook for the median valuation is comparing different populations. Choose one source for each analytical question, state the definition and use it consistently. The direction of travel may be similar across sources, but the levels are not interchangeable.

Direction can differ too. KPMG reports a rise in 2025 from $95.5 billion to $116 billion, while CB Insights reports a 12% dip. The reason, in part, is that KPMG includes M&A and private equity, which rose strongly, while venture-only measures are flatter. The divergence is informative: it suggests that conditions are better for mature companies, and for transactions that include buyers, than for early venture rounds.

What to do: ask your advisers for the definitions behind every benchmark in your board materials. For investor documents, use sources that investors themselves cite, and footnote the definition. Credibility in a data room depends on precision; an investor who finds that you have blended two data sets will question the rest of your analysis.

The same discipline applies to the claims made by advisers and vendors. Statistics that appear in press releases often come from different samples or time periods, or from a mixture of announced and closed deals. When a number matters to a decision, ask for the underlying methodology. A few minutes spent clarifying scope can prevent a presentation that an investor can dismantle in the first meeting by pointing out that the comparison is not like for like.

Given the selective market, preparation is the main source of advantage. The pack should have five parts. First, unit economics by product and cohort, showing contribution margin and payback. Second, regulatory standing: licences held, applications in progress, supervisory correspondence and the compliance team's capacity. Third, the control environment, including financial controls, information security and operational resilience. Fourth, the product and technology roadmap. Fifth, the exit view discussed earlier.

Regulatory maturity deserves emphasis because it affects speed. A fintech with the right licences, a documented compliance framework and a record of clean supervisory interactions can complete diligence faster. One that is operating under a partner's licence without a plan to obtain its own, or that has unresolved questions on safeguarding, anti-money-laundering or consumer duty, will face delays, price adjustments or conditions precedent. In the UK, FCA-authorised firms must be involved in regulated activities; in the Gulf, licensing from the central bank or the relevant authority will matter to local investors.

Plan the process itself. Allow eight to twelve weeks for a well-run growth round from first meeting to term sheet, depending on the stage. Prepare the data room in advance, rehearse the answers to the hardest ten questions and agree your acceptable terms with the board before meeting investors. Competitive tension, created by approaching several qualified investors in a defined window, improves terms more reliably than extended one-to-one negotiations.

Finally, remember that fundraising is a regulated area. Information provided to prospective investors can constitute a financial promotion, and offering securities may require authorised persons or an exemption. Take legal advice before circulating materials, and work with regulated advisers where the activity requires it. This article is information, not investment advice.

What to do: set a ninety-day preparation plan owned by the CEO and CFO, with a named owner for each element of the evidence pack. Begin with the weakest element. If the profitability bridge is the gap, address it first, since no amount of polish elsewhere compensates for a bridge that does not hold up.

It is also sensible to prepare for a failed or reduced round. Set out in advance what you would do if the process produced a lower valuation, a smaller amount or longer timelines than planned: which costs would be paused, which commitments deferred, and whether a bridge from existing investors would be available. Showing new investors that the company can reach its next milestone on a reduced budget reassures them that the plan is robust, and gives the board options if conditions change.

Our Capital Raising work helps fintech leadership teams prepare for investor scrutiny: building the profitability bridge, the regulatory and controls evidence pack, the investor map and the data room. Where an activity is regulated, we work alongside FCA-authorised firms. This article is information, not investment advice.