Insurtechs Led German Fintech VC in 2019

Insurtechs Led German Fintech VC in 2019

by February 14, 2020
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Insurtech startups in Germany raised a record of EUR 442 million in funding in 2019, up a staggering 216% from EUR 140 million the previous year. The figure made insurtech the most successful segment within Germany’s fintech sector, according to an analysis by consulting company Barkow Consulting.

Insurtech companies accounted for 26.4% of all funding going towards German fintech companies in 2019, surpassing aggregation, wealtech and proptech.

2019 saw several key insurtech deals. Wefox Group, the Berlin-based insurtech company, raised US$235 million in a Series B funding round, reaching unicorn status. Frankfurt-based Thinksurance, which has built a platform for insurance distributed to digitalize the entire commercial insurance distribution process, closed a EUR 13 million Series B funding round in October. And Friday, a specialist digital car insurer, raked in EUR 114 million in its latest round of financing in March.

Besides insurtech, some of 2019’s key fintech deals in Germany included N26’s US$300 million Series D funding round and Raisin’s US$114 million funding round.

After insurtech, Barkow Consulting names the finance aggregation category as the second most successful fintech segment in 2019, with startups in the field, which include challenger banks such as N26, Penta and Tomorrow, raising EUR 433 million in funding and representing 25.5% of all German fintech funding in 2019.

Meanwhile, proptech lost its momentum last year, dropping from the top spot in 2018 to the 5th position in 2019, the study says. In 2019, proptech companies raised EUR 198 million, compared with EUR 241 million in 2018.

German Fintech VC by Category, Barkow Consulting, February 2020

German Fintech VC by Category, Barkow Consulting, February 2020

The Barkow Consulting study echoes a separate report released last year by Oliver Wyman, which highlighted Germany’s rapidly growing and maturing insurtech sector. According to Oliver Wyman’s third issue of InsurTech-Radar 2019, Germany was home to 134 insurtech companies, as July 2019, up from less than 80 in 2014.

 

German fintech VC

2019 was a record year for German fintech venture capital (VC) on most measures, according to Barkow Consulting, with fintech startups raising more than EUR 3 billion in investment, including equity venture capital investment, debt, and merger and acquisition (M&A).

Equity VC investment reached a new record of EUR 1.7 billion, up 44% year-on-year (yoy), and the number of equity VC deals rose by 8% yoy to 141.

In 2019, fintech accounted for more than a quarter, or 27%, of all German equity VC, showcasing the sector’s continued importance within the German startup ecosystem.

BC Fintech Money Map- FY 2019 Venture Capital Review, Barkow Consulting, January 2020

BC Fintech Money Map- FY 2019 Venture Capital Review, Barkow Consulting, January 2020

German startups raised EUR 6.2 billion in 2019, a 36% increase compared with the previous year, according to a recent report by EY. Berlin startups got the lion’s share, raising nearly EUR 3.7 billion. Berlin is followed by Bavaria with EUR 1.5 billion, North-Rhine Westphalia with EUR 268 million, and Hamburg with EUR 254 million.

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