2021 saw interest in fintech grow to a fever pitch, leading to the crazy expansion of many fintech companies driven by high financing amounts. In 2022, fintech continued the fever. Data from a recent research report by Pitchbook show that global fintech companies raised about $29.3 billion (up 13.8% YoY) across 1,233 deals (down 6.5% YoY) in the first quarter of 2022.
Investors have faith in the fintech market, despite the volatile global stock market and the changing international situation.
Why did fintech continue its global boom?
As far as SocialPeta can see, there are mainly two factors leading to the current boom of fintech:
- The COVID-19 pandemic drove the development of fintech
Due to the COVID-19 pandemic, the global fintech investment declined in 2020, but online investment and online shopping showed rapid growth. During the post-pandemic era, people have gotten used to doing things online, which has further improved the activity level of fintech companies to bring about the financing fever of fintech in 2021.
Total deals and amount of global fintech investment; Image Source: Pitchbook
- Great demands for finance services from Internet-underdeveloped regions
Unlike in China, America, and other countries with well-developed financial technologies, other countries/regions in the world have relatively underdeveloped Internet technologies, so people there are unable to enjoy the convenience and efficiency of online financial services. It is also a great opportunity to many fintech start-ups including Stori, which is a new company in Mexico and a typical example.
Image Source: Stori
Supply has fallen short of demand in the Latin American credit market. That’s why [Stori] started to provide online credit card service in Mexico in 2020. So far, the app has acquired over 1.4 million local customers, and it also helped [Stori] achieve a revenue growth of 2000% in 2021. Recently, [Stori] raised $150 million in a new funding round and was valued at $1.2 billion.
Image Source: Stori
[Stori] has proven that where there is demand, there is a market. But to new players, financial industry might be highly risky. There’s no other way to know except through actual operations if the well-established fintech systems in developed regions will be applicable in underdeveloped regions. And there will be many specific problems in the market of different foreign countries/regions, including but not limited to problems arising from customs and policies.
To avoid the above-mentioned problems, we can learn from successful fintech companies whose experience may help us avoid some unnecessary mistakes.
Webull: Zero-commission, a small step towards globalization
[Webull] is an integrated brokerage company founded in May 2017. Less than a year later, the company became a member of the Financial Industry Regulatory Authority (FINRA) and a broker dealer registered with the Securities and Exchange Commission (SEC). Webull moved to 44 Wall Street Suite 501 New York in February 2018, and started to offer zero-commission services for American stock market in May 2018.
Image Source: Webull
According to data from the SocialPeta-Advertiser Analysis section, [Webull] emphasizes its “0-commission” services in its advertising slogans and advertising copies, trying to acquire more users through a lower access threshold. According to its public data, [Webull] traded over 2 billion stocks in 2018.
But [Webull] hadn’t stood out from all the other brokerage companies until 2021 when it played an important role in the battle of “retail investors against shorts”. During the battle, a band of retail investors in America managed to push up the share price of GameStop to 40 times higher within a month, causing many short sellers on Wall Street to suffer great losses and some institutions, such as [Webull], to earn a fortune and become famous.
According to the news, at the crucial moment of the battle, many brokerage companies including [Robinhood] closed trading on key stocks, putting retail investors in a disadvantageous position. But [Webull] opened earlier for trading, giving the retail investors a chance to fight back and also obtaining quite a lot of new users. [Webull] gained average of 1548% more new users within a week to quickly become the second biggest online brokerage company in America.
[Webull] was at the top of the list of highest-grossing finance apps on Android in H1 2022
Its regulatory licenses allowed [Webull] to access the market, and its zero-commission service mode enabled [Webull] to attract basic target users. Based on all that, [Webull] was qualified to join the “Retail Investors VS. Shorts”. However, there are other ways for fintech companies to seek success, and reaching users by meeting their core demands is also a good way.
Akulaku: E-commerce entering the financial market
[Akulaku] entered the Indonesian market in 2016, starting as an online installment shopping platform. At its early stage, most of the goods offered on the platform were electronic products and furniture, and later it offered living services such as mobile top-up service. In 2018 when the platform had a certain number of users, [Akulaku] started to offer personal unsecured loans, and slowly expanded its financial service business in Indonesia.
Like other app genres, [Akulaku]’s main way of promotion is to work with brand owners and buy directional media. According to data from SocialPeta, [Akulaku] had over 8000 deduplicated creatives in H1 2022, and it released more creatives in May and June in response to the fierce competition among e-commerce platforms in the summer.
[Akulaku] prefers releasing image creatives, with image creatives accounting for 90% of its total creatives in H1 2022. Most of its creatives show hot-selling products and big amounts of money to attract more users. A few of its creatives are short videos about dramatic stories. Overall, most of the app’s creatives display its features.
[Akulaku] has a vision that goes beyond just doing business in Southeast Asia. It will take Southeast Asia as a starting point and expand to cover more countries and users by building an ecological cooperation network of digital banks and BaaS services to help it explore more cities on the world map. Let’s look forward to it.
There are more financial opportunities awaiting in the future
2021 saw totally $165.625 billion invested into the global blockchain industry, up 222.38% YoY. With such an upward trend, more and more countries/regions started to implement policies to support the development of blockchain technologies. And, the tight regulations sped up the realization of blockchain technologies. When the relevant laws and regulations are completed, the fintech market will take on a new look in the future.
[Bonus] What has happened to the mobile marketing industry in H1 2022? To answer this, SocialPeta has published the “Mobile Marketing Report for H1 2022”, a report that provides complete and valuable information for your product to easily expand the market. The data in this report will cover 72 countries and regions, as well as more than 90 well-known marketing channels in the world. You can download the full report here.
