18 October 2017

Bay Area top spot for fintech startup funding

14 September 2015  |  7464 views  |  0 San Fransisco

Fintech startups in the San Francisco Bay Area tend to raise far more in capital funding than those in other parts of the US, figures put together by the Financial Solutions Lab (FinLab) suggest.

FinLab is a five year, $30 million programme established last year by the Centre for Financial Services Innovation and JPMorgan Chase to identify, test and expand the availability of services that increase household savings, improve credit, and build assets.

An opening competition for a $3 million prize pot attracted entries from some 298 startups. The lab has now crunched the numbers on the entrants to give a snapshot of trends in the burgeoning fintech market.

Between them, the 298 serve over 10 million Americans, employ nearly 2000 people, and are based in 34 states, although the Bay Area and greater New York City account for 38% of all applicants. Just 31% have female founders, which drops to 25% when the 62 non-profits are stripped out.

In total, the 298 have raised $178 million in capital. However, Bay Area organisations have pulled in an average of 71% more in funding, despite not having a significantly larger number of customers and having the same median team size as firms from other parts of the country.

Funding is not the be-all and end-all for the startups: asked for their motivation in applying to the lab, 72% said the access to partner opportunities, while 63% said capital and 37% networking.

When it comes to what the startups actually offer, more than half have a hybrid product, combining two or more traditional things. Financial planning tools are popular, but there is a growing consumer desire for technology that goes beyond information and allows users to take action, says FinLab.

Meanwhile, the nature of credit is evolving. Many applicants use technology to "enable short-term liquidity solutions that leverage personal relationships in new ways," says the report. Another hot area is prepaid. Of the 21 virtual account products among the lab’s applicants, a significant number are leveraging prepaid infrastructure.

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Atlanta gets fintech task force

Atlanta gets fintech task force

11 September 2015  |  6471 views  |  1 comments | 13 tweets | 6 linkedin
Australian incubator opens its doors as battle for fintech talent heats up

Australian incubator opens its doors as battle for fintech talent heats up

25 August 2015  |  7239 views  |  0 comments | 7 tweets | 9 linkedin
Andreesen Horowitz hires fintech 'veteran' Alex Rampall as general partner

Andreesen Horowitz hires fintech 'veteran' Alex Rampall as general partner

20 August 2015  |  8879 views  |  1 comments | 8 tweets
Interac backs Toronto fintech cluster

Interac backs Toronto fintech cluster

18 August 2015  |  9093 views  |  0 comments | 20 tweets | 6 linkedin
PE fund for African and Asian fintech startups raises $150m

PE fund for African and Asian fintech startups raises $150m

10 August 2015  |  8376 views  |  0 comments | 18 tweets | 7 linkedin
Former Google exec launches fintech startup

Former Google exec launches fintech startup

20 July 2015  |  6748 views  |  0 comments | 14 tweets | 5 linkedin
Fintech leads the charge as VC investment in UK tech firms hits record highs

Fintech leads the charge as VC investment in UK tech firms hits record highs

03 July 2015  |  18737 views  |  0 comments | 33 tweets | 20 linkedin
Global fintech investment triples - Accenture

Global fintech investment triples - Accenture

25 June 2015  |  19866 views  |  0 comments | 50 tweets | 28 linkedin
FinLab unveils winners of $3m cash flow management competition

FinLab unveils winners of $3m cash flow management competition

12 June 2015  |  5394 views  |  0 comments | 12 tweets | 3 linkedin
Mobile fintech investment soaring

Mobile fintech investment soaring

29 May 2015  |  12149 views  |  0 comments | 39 tweets | 25 linkedin
Europe sets the pace as fintech investment triples in 2014

Europe sets the pace as fintech investment triples in 2014

26 March 2015  |  14273 views  |  0 comments | 33 tweets | 21 linkedin
JPMorgan Chase creates $3 million prize pot for innovation challenge

JPMorgan Chase creates $3 million prize pot for innovation challenge

24 February 2015  |  6440 views  |  0 comments | 16 tweets | 5 linkedin
Investment in fintech startups soars

Investment in fintech startups soars

10 February 2015  |  22919 views  |  0 comments | 51 tweets | 31 linkedin

Related blogs

Create a blog about this story (membership required)
Register now visit www.fivedegrees.nl

Top topics

Most viewed Most shared
Ripple looks to drive bank adoption with $300m XRP rebate programmeRipple looks to drive bank adoption with $...
15477 views comments | 12 tweets | 4 linkedin
Swift positive on blockchain, but big challenges remainSwift positive on blockchain, but big chal...
8671 views comments | 16 tweets | 22 linkedin
hands typing furiouslyHow artificial intelligence can deliver a...
8275 views 0 | 8 tweets | 9 linkedin
satelliteGates Foundation backs Ripple collaboratio...
7738 views comments | 13 tweets | 10 linkedin
IBM uses blockchain to improve cross-border payments processingIBM uses blockchain to improve cross-borde...
6945 views comments | 9 tweets | 17 linkedin

Featured job

Find your next job