The fintech sector has been growing at an exponential rate in the past few years. Global investment in the fintech industry currently stands at a staggering $49.7bn per year, with the majority being invested in companies located in the U.S, UK, Europe, China and India. Investment in fintech companies has tripled in the past few years, with investments in 2012 recorded at only $12bn.
There are also 1,362 fintech companies in 54 countries globally. The U.S, UK, Ireland and Germany are leading the way with the most fintech companies and start-ups in the world. Fintech companies around the world have also received over of $25bn in funding to date.
Following on from our top 10 UK fintech companies to look out for, bobsguide has put together a follow up article on the top 10 US fintech companies to look out for this year. While there’s a myriad of well known fintech brands in the U.S, such as Square, Lending Club and Braintree, we thought we’d share some of the fintech companies that may not be as well known.
Here are the top 10 U.S fintech companies we believe will make industry waves in 2017:
Total equity funding to date: $440m
Probably the most famous company on the list, fintech unicorn Stripe is an American technology company that operates in over 25 countries. The creative thinking behind the company is to expand internet commerce by making it easier to process payments and transactions and manage an online business.
Digital banking has become a quintessential area of the fintech sector where companies are creating products that allow businesses to easily transactions online. Stripe works with companies ranging from start-ups to corporate businesses and provide a set of unified APIs and tools that allow payments to be managed online.
James Allgrove, UK Growth at Stripe spoke exclusively to bobsguide:
"Stripe exists to advance the state of the art in developer tools and support innovative businesses. This year, we're investing in software products that help technology businesses scale faster and help the next generation of start-ups get off the ground.”
“This includes advances in machine-learning powered fraud detection with our Radar product, which learns from Stripe's massive behaviour network of hundred of thousands of businesses to help our users fight fraud without reducing conversion. We're also excited to see how entirely new kinds of internet businesses scale internationally on Stripe Connect, our product built for marketplaces and platforms like Kickstarter and Shopify. Our users are scaling and innovating faster because of the way these software products work together, so this is a natural focus for us."
Total equity funding to date: $67m
Kensho is a data analytics and machine intelligence company. With a specialised focus around AI, Kensho’s machine learning systems filter through data and market information, searching for correlations between real world fluctuations to evaluate whether the movement would have an impact on assets.
Kensho was founded in 2013 by Daniel Nadler, a PHD candidate at Harvard University. The company secured its first seed investor, partnering with Google Ventures, and has since been backed by key Wall Street banks such as JPMorgan Chase, Goldman Sachs, Morgan Stanley and Citigroup.
Total equity funding to date: $238m
Another fintech giant, Kabbage is a financial technology and data company that has created an online automated system to lend money for small businesses and consumers.
Kabbage’s aim is to simplify the online application form for lending and borrowing money to become solely automated, with businesses and consumers using their own data to submit an application and receive an immediate decision to access funds on the spot.
Total equity funding to date: $1.88 billion
Social Finance (SoFi) is a well-established fintech company based in San Francisco. The company offers a variation of lending and wealth management services to consumers and businesses globally. SoFi caters primarily to early professionals and an essentially younger audience, offering a range of mortgages, student loans, and MBA loans.
SoFi has lent over $12bn to date. The latest funding for the company was in February this year, raising $500m in funding led by Silver Lake Parkers, allowing the company to expand into offering deposits and asset lending.
Total equity funding to date: $93.6m
Ripple offers real-time payments for financial firms around the world. The company’s purpose is to enable low exchange rates that enable banks and financial institutions around the world to directly transact with each other without the need for a central correspondent. Last year, the blockchain start-up company raised $55 million in a Series B funding round.
Total equity funding to date: $38.75m
Stash is a relatively new company that has already made waves in the fintech sector. With headquarters in New York, the company was created to break the mould for the investing sector, making online investment tools available for anyone with no requirements.
The platform goes further than just being an investment tool, as it aims to create awareness in financial habits that consumers can track and be aware of.
Total equity funding to date: $129.5m
Wealthfront builds and manages diversified portfolios for a multitude of businesses and consumers. The company was created to reimagine the way people invest their money, offering low fees in exchange for access to an automated investment service that builds personalised portfolios so consumers don’t have to.
With headquarters in Redwood, California, the company has over $2bn in assets under management.
Total equity funding to date: $654m
Avant was created as an online marketplace that provides individuals easy borrowing tools for personal loans and debt. The company uses data specific algorithms and machine learning to determine a customised approach to streamline credit options for individuals.
The company has lent over $3.5bn to over 500,000 customers globally.
Total equity funding to date: $111.5m
LendUp was founded to give those a better path to financial success and health. It has quickly emerged into the financial services industry, offering debit and credit cards, as well as loans for those who are interested in tracking their spending behaviour.
A pivotal marketing strategy for the company is accepting customers onto their programmes that banks usually decline. LendUp created the L Card, which was built for those who may be new to credit or debit cards or have previously not been able to be granted a card.
The ethos behind the company is to give customers with poor and low credit scores access to credit cards and loans with no hidden fees to provide stability for the consumer.
LendUp has now provided more than $1 billion in loans.
Total equity funding to date: $117m
Coinbase is an online platform that allows merchants, consumers and traders to transact with digital currencies. Based in San Francisco, the company allows users to create their own bitcoin wallets and start buying or selling various cryptocurrencies as they would normally with a digital trading platform. The platform allows trading of digital assets with currencies in 32 countries.
Coinbase allows users to connect their accounts with their bank accounts. The digital asset exchange company has surpassed 6 million users worldwide.