Serial Acquirers Market Update: Canada’s FinTech Scene Sneaking Back & Legacy Growth Through AI Adoption
Canada's FinTech sector has reached new heights, driven by major buyouts from Nuvei and Plusgrade, which contributed to a record $7.8 billion in investments in just the first half of the year. Despite previous struggles with deal volume and investment in 2022, the sector is showing signs of recovery and growth. Excluding those major deals, investments grew by 20% compared to early 2023, with notable funding rounds for companies like Brim Financial, Nesto, and Vena.
While slow regulatory progress and infrastructure issues remain as challenges, Canadian FinTechs are making strides. Two examples I’m keeping an eye on are Koho pursuing banking licences and Wealthsimple continuing to increase its valuation and assets. I’m hopeful a promising future for innovation and disruption in Canada's financial services sector is on the horizon, but we will have to wait and see.
Legacy SaaS Business Adapts to AI
Continuing the Canadian FinTech conversation, Toronto-based wealthtech firm PureFacts recently sold a majority stake to New York-based PE firm GrowthCurve Capital, valuing PureFacts at $250 million after its most recent $37 million funding round. Founded in 1997, PureFacts, a long-standing figure in Canadian FinTech, offers wealth and asset management solutions to clients such as BMO and Fidelity. GrowthCurve plans to accelerate PureFacts' growth through investing in technology and AI, aiming to enhance product development and expansion into new markets. This move is yet another example of the ongoing trend of AI technology influencing acquisitions and legacy software companies having the choice of adapting or being left behind. It’s nice to see a company that has been around for close to three decades experience success but hoping the next big move stays in Canada.
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