Despite market turmoil, VCs bet big on FinTech in 2022, study shows

By Puja Sharma

Over a quarter of the 206 deals a16z participated in last year went to FinTech companies – more than any other industry. There were 60% of FinTech investments that closed during H1’22 and 40% during H2’22.

Andreessen Horowitz (a16z) invested more in FinTech than any other category in 2022, according to research from CB Insights. As investors scaled back their investments amid market turmoil in 2022, the FinTech industry took a hard hit.

There were still top investors active in the space across various stages, valuations, geographies, and sub-industries, such as Andreessen Horowitz (a16z). The investment strategy of a16z revolves around fintech. In recent years, the firm has not only shored up its presence in more familiar sectors like banking but also reached deeper into newer territories like blockchain. 

Over a quarter of the 206 deals a16z participated in last year went to fintech companies – more than any other industry. There were 60% of fintech investments that closed during H1’22 and 40% during H2’22.

CB Insights data helped map how a16z spread its FinTech investments across different categories, such as digital lending, blockchain, and payments. Below, are a16z’s top 3 FinTech targets in 2022, including key deals in each category.

Payments 

More than a quarter (28%) of a16z’s FinT.ech investments in 2022 went to the payments category. Notable investments include:

• SpotOn ($300 million Series F): SpotOn offers a cloud-based platform that provides payment solutions for restaurants and small retailers.
• Jeeves ($180 million Series C): Jeeves offers corporate cards and other expense management tools for businesses, with a focus on credit and payments rails across countries and currencies.
• Tally Technologies ($80 million Series C): Tally’s app helps consumers pay off credit card debt more quickly by automating payments.

Blockchain

a16z has actively invested in companies developing blockchain platforms for years. In 2022, 22% of its fintech deal volume went to blockchain companies — although most of these deals closed between January and June, before the year-end turmoil that rocked the cryptocurrency markets. Notable investments include:

• Matter Labs ($200 million Series C): Matter Labs is an Ethereum development company building a rollup layer 2 networks designed to lower fees and speed up transactions.
• Lightspark ($175 million Series A): Lightspark, launched in May 2022, is building a Bitcoin payments tool.
• NEAR Protocol ($150 million Series B): NEAR Protocol is developing a platform for blockchain-based decentralized applications, with a heavy focus on Web3.

Digital lending

a16z’s third-most popular fintech category in 2022 was digital lending, accounting for 12% of the firm’s fintech deal flow. Notable investments include:

• Point Digital Finance ($115 million Series C): Point provides a lending marketplace that allows homeowners to borrow against a percentage of the future value of their property.
• Valon ($60 million Series B): Valon offers residential mortgage loan servicing technology through a cloud-native platform.
• Vesta ($30 million Series A): Vesta provides a platform for mortgage origination and underwriting that is designed to streamline processes, reduce risk, and help lenders improve their book of business.