Following two years of local and global challenges, the Israeli FinTech sector demonstrated remarkable resilience and strong performance in 2023 and early 2024. The sector has bounced back to its previous levels, and its resilience is underscored by steady and growing investor confidence in both public and private FinTech companies. The sector’s strength is further highlighted by increased early-stage investments, which, coupled with an easing in monetary policy, are setting the stage for a new wave of innovation and growth in the coming years.

Our 2024 fintech report provide insights on these trends:

FinTech Resilience

Public FinTech companies have shown strong revenue growth and maintained solid gross margins, demonstrating their resilience in a challenging economic environment. They’ve nearly matched their 2022 KFTX levels, recovering strongly, but still slightly lagging behind the NASDAQ and S&P 500.

Investor Confidence in Israeli Early-Stage FinTech

Early-stage funding has highlighted investor confidence in FinTech disruptors. The proportion of smaller funding rounds has increased, indicating strong early-stage aflite. In addition, the size of earlystage investment amounts for Israeli companies has risen, reflecting growing investor confidence in the sector.

Israeli FinTech Acquisitions Surge

Israeli FinTech companies stand out from global peers by prioritizing buyside acquisitions over exits during tough times, showcasing their financial stability and strategic foresight. This highlights the sector’s maturity and innovation, demonstrating its ability to grow in challenging market conditions and indicating its continued, crosscycle, pursue of success.

The Return of Israeli FinTech Funding

The early signs of recovery in funding activity in Q1 2024 are encouraging for the FinTech sector. Early and growth-stage rounds in Israel are nearing pre-2021 levels, indicating a positive trend in the funding landscape. This rebound suggests that the Israeli FinTech sector is on a path to regaining momentum, creating a conducive environment for growth and investment.