By George Ward
In 2022, fintech dominated the investment portfolios of some of the world’s leading venture capital firms. Sequoia Capital and a16z are two of the most prominent VC firms in the industry, and they have shown a strong interest in emerging technology.
Last year alone, a16z invested in a whopping 49 fintech-related companies. This is a remarkable increase from the previous year, in which it had only invested in seven such companies.
Likewise, Sequoia Capital also increased its investments in fintech companies, investing in 25 such companies in 2022. These investments speak volumes about the confidence of VC firms in the potential of fintech.
They believe that technology has the potential to revolutionize the financial sector, enabling more accessible and more secure access to financial services for customers.
Fintech Sector Booms Despite Economic Turmoil
Top venture capital companies focus heavily on fintech, with Sequoia Capital and Andreessen Horowitz (a16z) leading the charge. According to reports, these firms invested substantially into the fintech sector in 2022.
Sequoia Capital devoted about 25% of its 100 deals to fintech, while a16z followed suit. 2022 was a year of economic uncertainty, making the sizeable investments into fintech even more impressive.
Sequoia devoted 8% of its budget to fintech startups in the crypto sector, with EDXM and Multis being the biggest beneficiaries. On the contrary, a16z was more active in crypto investments, backing up 49 companies with its long-term focus on blockchain technology, and the enthusiasm is only increasing.
A16z’s investments in blockchain technology firms represented 22% of its total investments. Companies such as Phantom, Aztec, Lido, Goldfinch, and Near were among the notable firms received funds from a16z.
A16z’s Unrelenting Investment Spree
A16z has been committed to investing in crypto and blockchain technology for a long time. In 2021, the firm initiated a $1B crypto investment fund.
India is also a key area of interest, with a16z providing $500M of investments to startups in the country. Based on its actions in the new year, 2023 will be a year of significant venture capital investment from a16z.
Last week, a16z spearheaded a $25.5M financing round in Web3 social media platform Town. The firm spearheaded a $6M investment in Stelo Labs, a Web3 security firm, a few days prior.