Inside fintech’s rebound: Dan Latimore on Q3 funding trends

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New data from CB Insights’ State of Fintech Q3 2025 report shows an industry finding its footing again. After two uneven years, the funding landscape is in flux, as firms focus on AI and financial infrastructure. 

Let’s take a look at a few highlights:

  • Global fintech funding in the third quarter was $10.9 billion, roughly flat from Q2. Behind the steadiness storyline, the bigger story is about concentration. Mega-rounds of $100 million or more made up 40% of total capital, even as overall deal count was down 9%. Capital is flowing toward firms with momentum rather than early-stage, untested startups. Median deal sizes for mid- and late-stage rounds jumped 16% and 50% respectively compared to 2024, pushing total year-to-date deal sizes more than 35% higher.

  • Perhaps unsurprisingly, AI-enabled fintechs captured 23% of all global funding, their highest share in nearly two years. Five of the top ten deals, including Ramp’s $500 million Series E and AppZen’s $180 million Series D, went to AI-powered finance platforms, signaling that automation and agentic tools are now core to competitive advantage.

  • Capital tilted toward maturity. Mid- and late-stage deals reached 22% of total activity, the strongest showing since 2022, while early-stage rounds fell below 70% for the first time since 2020. Meanwhile, exits picked up, with 249 mergers and acquisitions, the most in over three years.

  • Year-to-date funding for wealthtech hit $4.2 billion, putting it on pace to nearly double 2024 totals. CB Insights’ hiring data shows three of the five fastest-growing global fintech job markets are in wealth-management technology, led by advisor-productivity platforms and AI-driven investment tools.

What’s the major story here?
Four points stood out to me. First, deal sizes are bigger and concentrated in the mid and late stages, meaning investors are favoring firms that have already demonstrated some degree of success. Second, AI fintechs are unsurprisingly grabbing a lot of attention. Third, wealthtech funding continues its momentum, with financial-advisory productivity tools showing high growth. And fourth, there’s growing institutional interest in crypto, showing that digital assets continue their march to becoming more mainstream.

What does the future hold for fintechs?
First and foremost, they’ve got to investigate whether AI can be incorporated into their workflows — and if so, execute on that. They also need to focus on specific problems that generate a demonstrable return on investment. Beyond that, fintechs must maintain the perennial basics: a scalable tech stack, strong compliance, and a flexible culture that makes them easy to work with.

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What’s the biggest surprise?
The increased risk-aversion of investors, as shown by the shift toward later-stage deals. It’s going to be harder for emerging fintechs to gain traction. AI is beginning to change the build-versus-buy calculus. Two years ago, my advice was for most banks to default to buying many tech solutions; now, advances in coding mean smaller institutions can realistically build their own tools to fit their specific needs at costs that were once out of reach.