Fintech firms are presenting a mixed bag with their fundraising during the Covid-19 outbreak.

A trio of recent reports reveals that the Covid-19 outbreak is causing fintech funding to evaporate, but several firms have announced successful fundraising rounds in the wake of the epidemic.

According to the Q1 2020 Fintech Trends Data report from CB Insights, venture capital-backed fintech funding dropped to $6.1 billion across 404 deals in the first quarter.

CB Insights goes on to say that venture deal volume has fallen to 2016 levels, while the amount of venture capital invested in fintech firms has fallen to levels not seen since 2017. Early-stage startup funding fell to 228 deals and $1.1 billion in funding, both multi-year lows.

Europe was the only region that saw an increase in venture-backed fintech funding, as funding in Asia, Australia, North America, South America and Africa fell during the first quarter, according to CB Insights. The withering of fintech funding followed Covid-19’s spread across regions, occurring first in China and southeast Asia before moving on to other areas.

Another recent report, this one from Ana.vc, a venture capital research firm, found a 57% decline in funding to fintech and digital asset projects in April. According to that report, certain fintech sectors, like decentralized finance and blockchain/distributed ledger developers, fared better than fintech as a whole, but still generally lost funding. Payments service providers saw their fundraising decline from $9.24 million in March to $1.61 in April. Slower growing or even declining valuations typically accompany a more challenging fundraising environment.

And in April, U.S. market researcher Forrester revealed research finding that funding into U.S. fintech was 46% lower in the first quarter of 2020 than it was in the third quarter of 2019.

The lack of funding could be fatal for some nascent fintechs. A fourth report, from research, analysis and policy advisory Startup Genome in April, found that 65% of companies that have raised at least Series A funding have 6 months or less of cash on hand, and that many companies and startups are shedding employees to survive what is likely to be an ongoing period of fundraising challenges.

But as the outbreak descended upon the Western world, fintech firms continued to raise funds, some with spectacular success. Stripe ended a Series G round of fundraising in April having raised $600 million, while U.K.-based challenger bank Revolut took in $500 million in the first quarter.

There were more moderate successes to report as well. Small business messaging platform Podium successfully closed $125 million in fundraising in March, while Stash was able to close a $112 million fundraising round, and Robinhood, beleaguered by outages during the March market volatility, was able to close on a $280 million fundraising round in early May.

Some startups also found success: LoanSnap, a mortgage, HELOC and refinancing tech company, recently announced that it had completed a $10 million fundraising round, shortly thereafter zero-fee charitable giving app Charityvest closed a a $1.1 million seed fundraising round, and in early may, Vise, a wealth management platform blending direct indexing capabilities with AI, announced that it had raised $14 million in Series A funding as it emerged from stealth.

As it turns out, volatility can even be good for startups, despite pessimism over their near-term fundraising prospects. According to a commonly cited study from the Kauffman Foundation, 57% of Fortune 500 companies were founded in a bear market or recession.

“Part of why we raised this funding is that we wanted to show a good front with the market uncertainty and that we’re there for our clients at will be able to support them,” said Samir Vasavada, co-founder and CEO of Vise. “This funding enables that, and it allows us to continue to be aggressive about rolling out products, service more advisors, hire a bigger team, get more outreach and offer more product and sales support.”

The outbreak may end up tamping down on IPOs for longer than expected, as well. During the 2008 and 2009 global financial crisis, the number of IPOs per year declined precipitously from their pre-crisis levels.

Yet there were still plenty of exit opportunities and some huge deals during the first quarter, led by Intuit’s $7.1 billion acquisition of CreditKarma, and Visa’s $5.3 billion purchase of Plaid, but merger and acquisition activity has slowed in the second quarter and is expected to remain muted over the short-term.

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