Enterprise fintech startup market map

The financial technology industry continues to be an attractive space for investors in spite of economic headwinds ranging from inflation to higher interest rates as the pandemic led to more people and businesses relying on digital financial services.

Fintech can be broken into two different segments: retail and enterprise. Retail fintech companies deal with customers directly, while enterprise fintech companies focus on businesses, banks and other financial institutions.

Despite the general caution regarding broader economic uncertainty, enterprise fintech companies are still prime candidates for investors due to how indispensable they are for businesses as well as the significant opportunities that remain for growth. With half of all payments made between businesses done via physical checks, there is plenty of room for these companies to grow, according to PitchBook analyst Rudy Yang. Higher demand from businesses for software and platforms that focus on cost savings could also power growth.

In today’s cost-cutting environment, tools that help CFOs better control expenses, payroll and budget forecasts are in high demand. The CFO stack segment remains relatively well-funded and was the second-most funded sector in B2B fintech in 2022. Even amidst the general drop in VC deal value, the sector has held up relatively well, according to Yang.

The market map below outlines the global enterprise fintech VC ecosystem. Explore the CFO stack segment by clicking on the blue tile.

To go deeper, read our inaugural Enterprise Fintech Report. PitchBook clients can also explore the full market map with details on more than 3,400 companies.

Spotlight: CFO Stack

CFO stack companies fall into four subsegments.

• Accounting, tax and compliance. Platforms and other technology for automating processes related to accounting and tax documentation in addition to helping businesses comply with regulations in those areas.
• Budgeting and forecasting. Technology that helps businesses with budgeting and financial forecasting.
• Expense management and AP/AR automation. Companies that help with automating and managing spending and invoices as well as accounts payable and accounts receivable.
• Payroll and earned wage access. Companies that help businesses automate payroll operations like onboarding as well as setting up different payment options for employees.

In Q4 2022, there were 375 deals worth $4.2 billion, representing a 37.3% decline in deal value quarter-over-quarter while deal count stayed unchanged, according to PitchBook data. This marked the third straight quarter with a decline in deal value.

As was the case for the broader VC market, 2022 was a down year compared to the lofty heights set in 2021. With $35.1 billion raised over 1,764 deals in 2022, deal counts and total deal value fell by 13.1% and 32.1% respectively year-over-year. However, it was still the second-highest year on record, largely powered by a strong first half.

Despite the quarterly deal value decline, there were some notable deals in the last quarter of 2022 such as a $130 million Series B expansion for regulatory technology platform developer TRM Labs and a $131 million Series A for financial planning system platform developer Updraft.

There were 150 exits worth $18.1 billion in 2022, a steep decline from the previous year but more in line with the activity seen in 2018 through 2020.

This sharp decrease is following trends within fintech as a whole, according to the report, with exit activity as a whole continuing to stagnate in the immediate future.

Notable exits in Q4 included credit financing provider Nearside being acquired by Plastiq for $130 million, and residential lending and mortgage management platform developer OpenClose was acquired by MeridianLink for $65 million.

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