Investments in Fintech Hit Record High in Q3

Global investments in financial technology firms hit their highest quarterly record to date, clocking in $8.9 billion in Q3 2019, according to the Q3 2019 Global Fintech Report from CB Insights. The year-to-date count of $24.6 billion already surpasses 2017’s annual total of $18.8 billion.

Early-stage transactions fell to an 11-quarter low and funding hit a seven-quarter low, contributing to the lower overall funding by aggregate annual data. CB Insights expects that this year’s deal total won’t top 2018, which saw nearly 2,000 deals and $40.6 billion in investments.

Asian markets helped propel this year’s growth, with China and India head-to-head for the top spot in the region. India raked in 33 deals totaling $674 million in total funding, while China had 55 deals totaling $661 million.

Southeast Asia reached new highs as well, setting an annual record with $701 million raised across 87 deals in the third quarter. The United States, however, experienced a slight pull-back in early-stage deals.

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Many institutional investors are pouring money into private equity deals as a whole, since their returns are amongst the highest in many portfolios. The California Public Employees’ Retirement System is struggling to keep up with its private equity pacing plan, and must to increase its commitments on a steady basis to meet its 8% target allocation to the asset class, according to its consultant Meketa.

Private equity firms have been under fire from politicians lately for its “predatory behaviors impacting investors.” Massachusetts Sen. Elizabeth Warren introduced legislation that would publicize their fees and returns, and likened them to vampires “bleeding the company [they acquire] dry and walking away enriched even as the company succumbs…Costing thousands of people their jobs, putting valuable companies out of business, and hurting communities across the country.”

CalPERS Falling Short of Private Equity Goals

Venture Capital Deals Set Record for 5th Straight Year

Tags: CB Insights, deal flow, Fintech, Private Equity, Q3 2019, record, Venture Capital

In a bid to end worker strikes that have paralyzed France for a week, French Prime Minister Edouard Philippe has announced the government’s plan to reform its pension system.

“The time has come to build a universal pension system,” said Philippe at a news conference in Paris. “We are proposing a new inter-generational pact.”

Phillipe, who revealed the plans in a speech at the Economic, Social and Environmental Council in Paris, touted the new system as being fairer than the old one, and one that would provide improved benefits for women and part-time workers.

Under the plan, the government will consolidate 42 distinct pension plans according to occupation and region into one overarching universal plan. The reformed pensions system will be based on points, which is intended to give everyone the same rights for the amount of money they pay into it.

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The legal retirement age will remain at 62, but includes incentives to keep working until age 64, which Philippe said will allow for a balanced pension budget by 2027. Retirees who have worked a full career, which in France is just under 42 years, will receive a minimum of €1,000 ($1,119) a month.

Philippe said the retirement system has been strained because there are only 1.7 people working to support each retiree, compared with 4.5 when the system was created in 1945.

“We know our children won’t have the same linear careers we had and we need a pension system that allows that,” Philippe said, according to Reuters. “We need to have faith in a system that is not deemed to favor one person over another.”

The General Confederation of Labor (CGT), France’s largest railway workers’ union, panned the new plan for the retirement system, and called for its members to continue to strike. The union said the plan does not question the ceiling of the 14% of the GDP devoted to the financing, nor the €120,000 annually of the wages subjected to contribution.

“The government has decided to remain silent to the anger of the workers in struggle and to go into force,” CGT said in a statement. “Faced with a deaf government, the trade unions reaffirm their call to strengthen the mobilization by the strike.”