Deal flow, however, was down significantly \u2014 signaling fewer, but larger rounds. The first half of 2025 saw 1,805 deals consummated, a 31.4% decline from the more than 2,633 completed in H1 2024 and down slightly \u2014 by 10.2% \u2014 from the more than 2,000 announced in H2 2024.<\/p>\n
IPO breakthrough<\/h2>\n
One thing that could work in fintech\u2019s favor in the short term is that the IPO dam finally seems to have broken<\/a> in 2025.<\/p>\n Since the beginning of the year, several companies in the fintech space have either gone public or filed to do so.<\/p>\n This matters for the private market since startup funding often follows the lead of public counterparts. If a number of fintech companies have impressive debuts on the public exchanges, that can only bode well for the private market.<\/p>\n Meanwhile, digital wealth management startup Wealthfront<\/a> on June 23 filed confidentially for a U.S. initial public offering. And in early June, crypto exchange Gemini<\/a> confidentially filed its own plans for a U.S. IPO. Expense management firm Navan<\/a> (formerly TripActions) also filed confidentially for a U.S. IPO in June.<\/p>\n However, despite filing for a U.S. IPO last year, Swedish buy now, pay later giant Klarna<\/a> put the brakes on those plans, citing concerns over President Donald Trump<\/a>\u2018s sweeping tariffs.<\/p>\n To get insight into who\u2019s funding all these fintech startups, Crunchbase took a look at the most active investors in the space.<\/p>\n Alexandria, Virginia-based QED Investors<\/a> took the top spot for leading or co-leading rounds of more than $5 million into fintech companies in the first half of 2025. The firm\u2019s exclusive focus is fintech investing.<\/p>\n Other active investors in the space include Sequoia Capital<\/a>, Hack VC<\/a>, Accel<\/a> and Polychain<\/a>.<\/p>\n As mentioned earlier, the fact that the sector experienced an increase in funding despite a lower deal count indicates that the first half of 2025 saw a number of large rounds.<\/p>\n All told, there were more than three dozen deals totaling $100 million or more that took place in the fintech space in the first half of 2025, Crunchbase data shows. Crypto exchange Binance<\/a> raised the most money by far \u2014 a $2 billion venture round<\/a> led by MGX<\/a> in mid-March. Other large deals include infrastructure platform Plaid\u2019s<\/a> $575 million raise in early April; U.K. payments platform Rapyd<\/a>\u2019s $500 million haul in mid-March; HR and payroll startup Rippling\u2019s<\/a> $450 million Series G in May; and online banking startup Mercury<\/a>\u2019s $300 million Series C round in late March.<\/p>\n Speaking of large rounds, the investors that led or co-led rounds greater than $230 million differed some from the list above. MGX took the top spot, with Sequoia, Franklin Templeton<\/a>, Paradigm<\/a> and Founders Fund<\/a> rounding out the top five.<\/p>\n QED Investors partner Camila Vieira<\/a> said her firm is \u201ccautiously optimistic\u201d that fintech is on its way to making a comeback.<\/p>\n \u201cThere\u2019s a real sense of momentum returning, particularly in B2B infrastructure, AI-native fintech and climate-aligned financial services,\u201d she told Crunchbase News. \u201cThe market feels more grounded, and founders are building with stronger fundamentals from the outset.\u201d<\/p>\n QED\u2019s investment pace has remained steady, but with one notable difference. It\u2019s become \u201ceven more selective,\u201d Vieira said, \u201cfocusing on higher-quality opportunities, especially at the Series A and B stages.\u201d<\/p>\n She added: \u201cWe\u2019re spending more time with companies that show real traction, capital efficiency and readiness to scale, even in today\u2019s tighter environment.\u201d<\/p>\n QED remains cautious on consumer-facing fintechs \u201cthat lack a clear wedge,\u201d particularly mono-product neobanks or lenders \u201coverly reliant on paid acquisition and margin-based competition.\u201d<\/p>\n \u201cThe bar for differentiation is significantly higher today,\u201d said Vieira. \u201cThat said, we continue to see exciting consumer models where companies own distribution or have access to proprietary data.\u201d<\/p>\n Neil Kapur<\/a>, partner at Atlanta-based TTV Capital<\/a>, acknowledges that \u201csome dollars have moved away from fintech.\u201d<\/p>\n Still, the firm is trying to not let the noise impact the positive signals it\u2019s seeing in the sector.<\/p>\n \u201cWe know that in the short term the market will produce some volatility around potential investments; but on a longer time horizon, we see significant opportunity in financial services broadly,\u201d he told Crunchbase News. \u201cIn the past year, there has been a round of IPOs, M&A and consolidation \u2014 in some cases, producing positive outcomes for investors, and in others, enabling company survival.\u201d<\/p>\n Notably, many of the investments TTV made in the first half of 2025 are companies that were founded less than two years ago. In fact, its volume of newly closed investments in 2025 has increased by 3x vs. last year due to what the firm perceives as \u201can overall increase in both company quality and investment activity.\u201d<\/p>\n In Kapur\u2019s view, it\u2019s clear that AI has kicked off \u201ca super cycle\u201d and will be \u201ctransformational\u201d as a new enabling technology.<\/p>\n \u201cWe all agree that AI will revolutionize the financial services industry; the big question is when,\u201d he said.<\/p>\n The firm also is bullish on consumer fintech despite some of the negative sentiment around the segment.<\/p>\n \u201cWe still see unending potential,\u201d Kapur said. \u201cJust look at Revolut<\/a>\u2019s latest numbers and the rumors surrounding their upcoming fundraise.\u201d<\/p>\n The firm is also seeing traction from non-AI-native companies in categories that may be overlooked by investors, but still operate in \u201cmassive revenue and profit pools\u201d such as lending.<\/p>\n Sheel Mohnot<\/a>, co-founder and general partner at Better Tomorrow Ventures<\/a>, is resoundingly enthusiastic in his belief that fintech is in fact having a comeback year.<\/p>\n \u201cIt feels like every company that survived is doing incredibly well after suffering for a couple of years,\u201d he told Crunchbase News. \u201cWe never stepped off the gas because we have always believed in the sector.\u201d<\/p>\n Like many other investors, Mohnot believes that there is still a lot of opportunity where AI meets fintech.<\/p>\n \u201cThere are just so many things that AI can help solve,\u201d he said, noting that BTV continues to be excited about embedded fintech, particularly in the banking, payroll and accounting segments.<\/p>\n Mohnot is less bullish on stablecoins. While he concedes they can solve some problems \u201creally well,\u201d he thinks \u201cthere are way too many people trying to solve things with stablecoins that probably won\u2019t be solved with stablecoins \u2026 like payments in the U.S.\u201d<\/p>\n Looking ahead, Mohnot predicts more generalist funds will be tip-toeing back into fintech after sitting out 2023 and 2024. He also expects we\u2019ll see even more companies going public in 2026, and continued consolidation \u201cas some 2021\u2011era Series\u202fB startups sell or merge once post\u2011pandemic tailwinds fade.\u201d<\/p>\n He added: \u201cI think we\u2019ll also see AI everywhere \u2014 not much distinction between an AI fintech and a fintech company.\u201d<\/p>\n Jeremy Jonker<\/a>, co-founder and managing partner at Infinity Ventures<\/a>, agrees there\u2019s definitely more energy in the market compared to the past couple of years.<\/p>\n \u201cRounds are getting aggressively preempted, M&A seems to be picking up, and IPO chatter is back,\u201d he said. \u201cHowever, this rebound appears selective as the companies getting rewarded now tend to be the ones with strong fundamentals. The growth\u2011at\u2011all\u2011costs era has faded. \u2026The bar remains very high.\u201d<\/p>\n For its part, Infinity Ventures is focused on areas where it believes startups are positioned to out-execute and take share from incumbents and later-stage companies. Agentic workflows in regulated industries are a good example, Jonker said.<\/p>\n \u201cWe\u2019re less interested in generic LLM wrappers that are relying solely on distribution or abstract use cases that never make it into real workflows,\u201d he said.<\/p>\n In general, Jonker believes that AI has become foundational in fintech, and not just a feature.<\/p>\n \u201cWe\u2019re seeing it used to automate dense, rules-based workflows in regulated industries, power agentic systems that can trigger actions without human input, and unlock new ways to serve customers with fewer resources,\u201d he told Crunchbase News. \u201cThe hype cycle is still noisy, but the real impact is happening where AI is embedded deep in the workflow, tied to proprietary data, and driving tangible productivity gains.\u201d<\/p>\n David Mort<\/a>, general partner at Propel<\/a>, believes that fintech is in fact already having a comeback year thanks to a few tailwinds including the impact of AI, the growing intersection between traditional financial services and cryptocurrencies, and the successful launches of products and services from companies established over a decade ago, including Coinbase<\/a>, Robinhood<\/a>, Revolut<\/a> and Nubank<\/a>.<\/p>\n \u201cExcitement has returned to the fintech space, and we owe it to these three tailwinds,\u201d he told Crunchbase News.<\/p>\n\n
Active investors and bigger deals<\/h2>\n
\u2018A real sense of momentum returning\u2019<\/h2>\n
AI spurring fintech \u2018super cycle\u2019<\/h2>\n
IPOs, M&A and a higher bar for funding<\/h2>\n
Related Crunchbase query:<\/h2>\n
![](\"https:\/\/news.crunchbase.com\/wp-content\/uploads\/AI_Sector_Fintech.jpg\")
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