A report by KPMG in Canada says investment in Canadian fintech companies plunged in the first half of the year as valuations fell to levels not seen since the beginning of the pandemic.
According to data compiled by PitchBook for KPMG in Canada, fintech investment in Canada, including venture capital, private equity and merger and acquisition activity, totalled US$353.7 million across 57 deals in the first six months of 2023.
The result was down from a total of $1.09 billion across 87 deals in the second half of 2022 and US$834.1 million across 109 deals in the first half of last year.
The report says the first half of 2023 was one of the weakest for valuations since the first half of 2020.
Geoff Rush, partner and national industry leader for financial services at KPMG in Canada, says the decline in investment is the continuation of a downward trend that started last year.
Rush says investors are still concerned about the state of the global economy, with fears of a recession, elevated inflation and interest rates continuing to put a significant strain on valuations.