Q2’21 was the largest funding quarter on record. Across 657 deals, global VC-backed fintech companies raised a record $30.8B, shattering last quarter’s funding record by 30%. This impressive funding growth was accompanied by a modest 2% deal growth quarter-over-quarter (QoQ) and a 29% increase year-over-year (YoY).

Funding activity grew in nearly all fintech sectors except for wealth tech and capital markets tech. The digital lending, banking, and SMB fintech sectors saw the most pronounced deal activity growth QoQ.

Explosion of mega-rounds drove the funding boom. This quarter, global fintechs raised 88 mega-rounds (deals worth $100M+) — up from 60 in Q1’21 — accounting for 70% of total funding. As a result, the average deal size grew 28% from nearly $37M in Q1’21 to $47M.

South America led growth in both funding and deal count.

Funding to South America-based fintechs grew dramatically by 153% QoQ, while deal activity on the continent grew 52% QoQ — the largest increase among regions. Deal activity was varied with QoQ growth across North America, South America, and Australia, while Asia, Europe, and Africa all saw deal declines. However, across the board, all continents saw increased funding.

Fintech public exits reached new highs. There were 19 public exits (including announced, but not yet completed, deals) for VC-backed fintech companies in Q2’21. In addition to traditional IPOs, a notable portion of these deals represented SPACs, which have become an increasingly popular path for fintechs to enter public markets. This quarter, Grab, Better.com, Dave, and Acorns all announced plans to go public via SPACs.