GP.B-2020年第一季度金融科技报告（英文）-2020.6-40页_6mb

Fintech Sector Update Q1 2020 Summary

Core Content

This report provides a detailed analysis of the fintech sector during Q1 2020, focusing on both quantitative and qualitative insights into market valuations, transaction trends, and company performance. The impact of the COVID-19 pandemic is a central theme, with emphasis on how the digital shift has affected different sub-sectors and the importance of recurring revenue models.

Key Sector Takeaways

• Impact of COVID-19: The crisis has accelerated the digital shift, with fintech companies that offer digital solutions and have strong unit economics likely to benefit. There is expected to be increased consolidation in the payments sector, as incumbents enhance their capabilities and challengers face lower volumes.
• Challenger Banks: There is a renewed focus on business banking, with companies like Monzo, Starling, and Revolut expanding their offerings and monetization strategies.
• Open Banking M&A: The sector has seen significant M&A activity, including the acquisition of Plaid by Visa and Strands by CRIF, indicating a trend toward consolidation and enhancing digital capabilities.
• AI/ML Fintech Enablers: These companies are expected to benefit from the digital shift, particularly in KYC/AML, fraud detection, and credit scoring, as they offer advanced data analytics and automation.

Recent Fintech Transaction Trends

• Global Fintech Transaction Volume: There has been a slowdown in M&A and fundraising activity, with fewer deals but higher valuations. Asian investors are less active, and investors are focusing on later-stage businesses.

• Payments Consolidation: Strategic acquisitions have been notable, such as Plaid by Visa and Ingenico by Worldline, suggesting a trend toward consolidation in the payments sector.

• Challenger Bank Investments: Several challenger banks have raised capital, including Revolut, Thought Machine, and Tink, indicating continued investor interest in these models.

• Notable Acquisitions:

  • Plaid acquired by Visa for $5,300 million
  • Ingenico acquired by Worldline for $8,600 million
  • Credit Karma acquired by Intuit for $7,100 million
  • EXTRADE acquired by Morgan Stanley for $13,000 million
  • Klarna acquired by Commonwealth Bank for $200 million
  • Currencycloud acquired by Visa for $80 million

• Notable Fundraisings:

  • Revolut raised $500 million
  • Thought Machine raised $83 million
  • Tink raised $99 million
  • PLASTIQ raised $75 million
  • BharatPe raised $75 million
  • ecovadis raised $200 million

Public Market Fintech Analyses

• Fintech Index Performance: The fintech index dropped by approximately $24 billion in Q1 2020 due to the pandemic, but some sub-sectors, such as Financial Data & Analytics and Payments, showed better performance.
• Valuations: Fintech valuations are currently below the 3-year average, with Financial Data & Analytics and Payments sectors being strong beneficiaries of the digital shift.
• Key Performance Metrics:
  • Financial Data & Analytics had a 4.8% LTM revenue growth and 35.1% EBITDA margin
  • Banking Technology had a 1.6% LTM revenue growth and 31.6% EBITDA margin
  • Payments had a 4.9% LTM revenue growth and 33.9% EBITDA margin
  • HR & Payroll had a 10.8% LTM revenue growth and 29.2% EBITDA margin

Fintech CEO Commentary

• Bankable: Led by Eric Mouilleron, Bankable focuses on Banking-as-a-Service, offering API-enabled digital banking and payment solutions. The company aims to provide transparency and real-time capabilities for end-customers.
• ZestMoney: Founded by Lizzie Chapman, Priya Sharma, and Ashish Anantharaman, ZestMoney provides affordable credit to underbanked populations using AI and mobile technology. The company has raised $63 million from notable investors.
• TPAY MOBILE: Founded by Sahar Salama, TPAY MOBILE is a leading merchant acquirer in the Middle East and Africa, offering cross-border payment solutions. It has a unique proposition of reaching 580 million+ users through mobile number-based transactions.

Appendix Highlights

• Trading Comparables by Category: A table comparing various fintech companies in the Financial Data & Analytics category, including Moody's, Thomson Reuters, and MSCI, highlighting their financial performance and valuation metrics.
• GP Bullhound Fintech Credentials: Information on the firm's fintech advisory and investment experience, including over 20 fintech transactions and notable investments in companies like Revolut, Monese, and EcoVadis.
• Corporate Overview: A brief overview of GP Bullhound, highlighting its role as a leading technology advisory and investment firm in the fintech space.

Conclusion

The fintech sector in Q1 2020 was significantly impacted by the COVID-19 pandemic, with a shift toward digital solutions and recurring revenue models. Challenger banks and AI/ML enablers are expected to benefit from this trend, while consolidation is anticipated in the payments and open banking sectors. Investors remain interested in differentiated models and innovative technologies, as seen in the continued fundraising and M&A activity.