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December 23, 2020updated 24 Dec 2020 6:48am

Venture Capitalists trends: Fintech leads Twitter mentions in November 2020

Verdict lists the top five terms tweeted on venture capitalists in November 2020, based on data from GlobalData’s Influencer Platform. The top tweeted terms are the trending industry discussions happening on Twitter by key individuals (influencers) as tracked by the platform.

1. Fintech – 603 mentions

European fintech sector lagging behind the US, Covid-19 expediting transition to digital payments and fintech firms competing with traditional banks were some popular topics discussed in November 2020. According to an article shared by Florian Graillot, founding partner at astroya.vc, a venture capital (VC) fund, the American fintech industry is booming, while the European fintech industry is failing to catch up.

The European continent, especially London, was the vanguard of the fintech industry just a few years ago but has fallen behind the US due to the 28 different regulators and payment infrastructures in the UK. The US has the advantage of a single payments infrastructure, the article highlighted.

Further, Spiros Margaris, a fintech influencer and venture capitalist, shared an article about the acceleration of UK’s shift towards digital transactions during the coronavirus pandemic induced lockdown. The pandemic related crisis became a tipping point in the domains of online banking and mobile payments.

UK’s e-commerce economy witnessed an exponential growth since the onset of the pandemic, with many companies joining the online business bandwagon for fear of becoming redundant. The use of quick response (QR) codes for tracing contacts is also expected to gather steam across Europe and North America during the pandemic, the article noted.

Fintech also trended in discussions shared by Christos Mastoras, a VC investor, about fintech companies competing with traditional banks in the US by accepting customer deposits. Varo Money, a Silicon Valley start-up, began to accept federally insured customer deposits, becoming the first consumer fintech business to receive a national banking charter. The approval granted by the Office of the Comptroller of the Currency gave a level-playing field for start-ups to take on banks. The start-ups are competing for a $16tn portion in deposits and $100tn in yearly payments in the country’s banking system, the article highlighted.

2. Artificial Intelligence – 393 mentions

Covid-19 diagnosis using artificial intelligence (AI) and how only a few firms using AI are reaping the benefits of the technology were some extensively discussed topics in the previous month. Tim O’Reilly, founder and CEO of O’Reilly Media, an online learning company, shared an article about distinguishing Covid-19 positive patients, including asymptomatic ones by leveraging AI.

Researchers from the Massachusetts Institute of Technology created an AI speech processing framework that uses acoustic biomarkers for identifying coronavirus through cough recordings. The research demonstrated that AI techniques can yield a free Covid-19 asymptomatic screening tool to expand current methods in curbing the spread of coronavirus, the article highlighted.

Other discussions surrounding AI included how only 11% of the firms harnessing AI framework are getting a substantial return on investment (RoI), according to an article shared by Hussein Kanji, analyst at Hoxton Ventures, an emerging VC firm. A recent study concluded that very few companies actually benefit from AI technology, in contrast with the recent hype surrounding the technology.

A major factor contributing to the successful implementation of AI for some companies was the continued use of the technology despite teething troubles. Businesses where the staff worked closely with AI algorithms obtained robust financial returns, compared with the ones that did not adapt themselves to AI technology, the article highlighted.

3. Machine Learning – 347 mentions

How machine learning augments business intelligence and two companies collaborating to use machine learning for research on diseases were some widely discussed topics in November. According to an article shared by Spiros Margaris, leveraging machine learning and AI helps companies improve their business intelligence (BI).

Using these advanced technologies, businesses are gaining deep insight and implementing them in developing future business models. Further, the open-source phenomenon is providing mid-market and small and medium-sized enterprises (SMEs) with access to advanced BI solutions, the article highlighted.

Machine learning was also discussed in an article shared by Financial Carnivores, a crowdfunding news website, about Bristol Myers Squibb (BMS), a pharmaceutical firm, signing a deal worth $50m with insitro, a drug discovery and development company, to develop treatments for various disorders. insitro will utilise machine learning to develop drug candidates for neurodegenerative diseases such as amyotrophic lateral sclerosis and frontotemporal dementia, while BMS will be responsible for further clinical development, the article highlighted.

4. Startups – 323 mentions

The impact of Covid-19 on the start-up ecosystem, SoftBank funding electric scooter start-up and two UAE-based companies collaborating to transform truck logistics were some broadly discussed topics last month. David Cohen, founder and managing partner at Techstars, a global platform for innovation and investment, shared an article about how the funding and mergers and acquisitions (M&A) in the start-up industry were affected due to the ongoing pandemic.

Cohen analysed data for a six-month period from the onset of the pandemic in April to October 2020. While M&A activity picked up steadily through smaller deals, start-ups found it difficult to raise new funding. The financing activity showed no significant change compared to last year, the article highlighted.

Marcin Zabielski, managing partner at Hedgehog Fund, a VC fund, further, shared an article about SoftBank, a Japan-based holding company, investing $250m in Tier Mobility, a Germany-based e-scooter start-up. The investment was made through SoftBank’s Vision Fund and is considered to be the biggest funding round for an e-scooter company in Europe. The valuation of Tier Mobility almost touched $1bn following the investment, the article noted.

Another discussion related to start-ups was shared by Christos Mastoras, about Maqta Gateway, UAE’s port community system operator, and TruKKer, a truck aggregator, signing a memorandum of understanding (MoU) for digital transformation of truck logistics. The two companies proposed to transform the truck business by leveraging Maqta’s digital logistics solution platform, MARGO. The collaboration will enable TruKKer’s customers to access a range of cargo movement solutions, the article highlighted.

5. Investments – 247 mentions

Funding raised by online events platform, investments in European healthtech sector and private equity investments projected to surge were some trending topics in November. According to an article shared by Matt Mazzeo, partner at Coatue, a global investment firm, online events provider Hopin raised $125m in a Series B funding round. Many investors including IVP, Tiger Global, DFJ Growth participated in the funding round, along with returning investors such as Accel and Salesforce, among others, the article highlighted.

Further, Brent Hoberman, co-founder of Founders Factory, a start-up accelerator, shared an article about how the burgeoning healthtech industry in Europe performed in terms of attracting investment this year. Despite the uncertainty amid the ongoing pandemic, investors invested $2.3bn into European healthcare start-ups in Q3, compared with $2.9bn for the corresponding period in 2019. The start-up ecosystem, which was vibrant in the past ten years, declined slightly during the past three years due to lower funding, the article noted.

Another discussion surrounding investments was shared by Hussein Kanji, about how steady fundraising and robust investment will help private equity industry double its assets by 2025. The private equity assets could surpass the $9tn mark over the next half decade, provided the investment flow into the sector does not stop. The industry assets grew exponentially over the last five years reaching $4.4tn in October this year, compared with $2.3tn in 2015. The Covid-19 pandemic, however, reduced the assets under management by $70bn in 2020, the article highlighted.