In recent years, private investments have become a driving force in the fintech and payments landscape, particularly within the merchant services sector. With the global fintech market valued at approximately $294 billion in 2023 and projected to exceed $1 trillion by 2032, private capital has fueled transformative growth and innovation. Private capital has been instrumental in this expansion, providing essential funding that enables fintech firms to innovate and scale their digital solutions, effectively navigating the rapidly evolving digital environment.
Today, we’re joined by David Núñez, Strategy Consultant at PaymentGenes, to explore how private investments are transforming fintech and payments. With his expertise in payments strategy and his keen interest in private investments and M&A, David provides unique insights into this dynamic industry.
David: Absolutely. At PaymentGenes, I work as a Strategy Consultant, focusing on helping companies in the payments and merchant services sectors unlock growth opportunities. My role involves market analysis, developing strategies, and ensuring our clients stay competitive in this increasingly digital and globalized space.
What excites me about this field is how payments touch every part of modern life—they’re integral to businesses, consumers, and entire economies. My background in economics and international relations gave me a passion for understanding the broader forces shaping markets, and payments are a perfect example of that dynamic in action.
At PaymentGenes, I’ve had the chance to collaborate with a range of clients—from startups to established players—helping them navigate challenges like market entry or operational optimization. It’s incredibly rewarding to see how the strategies we develop can directly contribute to their success and, ultimately, to the evolution of the payments industry as a whole.
David: After a COVID-driven surge, private investments in fintech experienced a temporary decline as the market adjusted to new realities. However, we’ve now reached a point of stabilization, closer to pre-2019 levels. By the end of 2024, private investments across North America, Europe, and Israel are projected to reach approximately $16 billion year-to-date.
I’m optimistic about where we are headed, but I don’t think we’ll see the bullish growth of 2021 again anytime soon. Instead, we’re looking at a more sustainable pace of growth, which isn’t a bad thing—it reflects a focus on long-term fundamentals rather than inflated valuations. This stability is a strong signal of continued confidence in the fintech sector’s potential to drive innovation and adapt to changing market demands.
Private investments from venture capital and private equity remain critical for fintech companies, especially for Payment Service Providers (PSPs). They provide the resources needed to scale, innovate, and tackle the high upfront costs required for technology development, product innovation, and regulatory compliance.
In the merchant services sector, for example, private capital has been pivotal. PSPs and fintechs handle immense transaction volumes, requiring real-time, secure processing across global markets. This demands significant investment in both technological and regulatory infrastructure. Beyond funding, private investors also offer strategic insights, helping companies expand into new markets and address the rising demand for digital payment solutions.
David: Private capital fuels innovation by giving fintechs the resources to explore new technologies and optimize their offerings. AI-driven fraud detection, for instance, is one area where private capital has spurred rapid innovation, reducing fraud and associated costs for merchants. Adequate private funding also allows PSPs to improve foreign exchange rate efficiency, reduce processing times, and lower the costs of cross-border transactions, addressing a growing need for efficient global payment solutions.
David: It really depends on the stage of the company.
For seed and early-stage investors, the focus is more on the big picture—the founding team, the size of the market opportunity, and the innovative potential of the product. At this stage, metrics like initial traction or early partnerships might be more important than profitability. Investors are looking for bold ideas that can scale, even if the business model is still being validated.
For later-stage investors, the priorities shift. By this point, they’re looking for proof of scalability and operational efficiency. Metrics like transaction volume growth, profitability, and the ability to navigate complex regulatory environments become much more critical. These investors want to see that the company is ready for sustained growth and can handle the demands of expansion.
That said, there are key metrics that investors evaluate at all stages to assess a company’s potential:
Understanding what matters most to investors at your specific stage can make all the difference when seeking funding.
David: It all starts with clarity. Fintechs need to clearly articulate their value proposition and show how they’re addressing a real market need. Investors don’t just want a great idea; they want data-driven proof points, like user growth rates or successful partnerships, that demonstrate product-market fit.
Here are some practical tips:
David: Absolutely. Some of the most successful fintechs today highlight how strategic private investments can propel companies to incredible heights. They show the scalability and innovation possible when the right funding and guidance come together.
Let me break down three well-known examples in the industry: Stripe, Adyen, and Checkout.com. These companies not only leveraged private capital to expand their offerings and enter new markets but also set benchmarks for the future of fintech.
These 3 cases show the far-reaching potential of private investment. For future fintechs, the lesson is clear: innovation, scalability, and operational excellence are the keys to attracting investment and achieving sustainable growth.
David: I see a few main trends shaping the future of investments in the merchant services sector, transforming how payment companies operate and innovate.
David: At PaymentGenes, we focus on helping our clients make the most of their opportunities. Whether it’s refining their strategies, optimizing operations, or identifying new growth paths, we provide the tools and insights they need to succeed.
For me, it’s incredibly rewarding to see our work directly impact a client’s growth and contribute to the evolution of the payments industry. We’re committed to shaping the future of fintech by empowering our clients to thrive in this exciting, fast-changing space.
The future of fintech holds endless possibilities—driven by innovation, collaboration, and the courage to reshape the way the world moves forward together.
We specialize in providing tailored Consultancy Services designed to address the unique challenges of businesses across the payments and fintech ecosystem. Our expertise spans market analysis, strategy optimization, vendor selection, and more—empowering you to stay competitive in a rapidly evolving landscape.
Whether you’re optimizing your payment strategy, exploring new growth opportunities, or streamlining operations, we’re here to help you achieve your goals with customized, actionable solutions.
Ready to take the next step? Let’s discuss how PaymentGenes can support your success.
David is a Strategy Consultant at PaymentGenes, where he focuses on market research, strategic planning, and providing insights into the merchant services space. With a passion for payments, investments, and M&A, David helps payment companies navigate complex market dynamics and optimize their solutions.
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