Goldman Sachs, Citi, and JPMorgan Lead U.S. Banks in FinTech Investment

The question of whether FinTechs and banks are friends or foes has been a topic of debate for more than a decade now. Funny enough, the perception of animosity persists despite the two camps regularly partnering with each other. On top of that, several banks have taken to investing in startups and helping them grow.

According to Business Insider, JPMorgan, Goldman Sachs, and Citi are currently the largest investors in FinTech among U.S. banks. In fact it’s been that way since 2012.  In fact two of the banks — Goldman and Citi — maintain separate investment firms for such purposes. Meanwhile  JPMorgan apparently has a tech investment budget of a whopping $11.4 billion for 2019. Additionally the bank runs its own incubator for startups and intends to build a FinTech campus in Palo Alto.

Between the three banks, they’ve invested in 22 FinTechs this year so far. However Business Insider notes that the trio seems to gravitate toward different spaces in the sector. For example JPMorgan has funded three startups in the accounting and tax industry, while Goldman Sachs appears interested in wealth management and real estate investing. Citi is the most varied of the three, venturing into payments, data aggregation, and beyond.

The FinTech investments Citi has made this year include leading the project management and billing company HoneyBook’s series C as well as participating in a round for Flybits. As for JPMorgan, they led a seed round for Trovata and participated in a Series C for financial software company OpenFin. Finally Goldman led a Series B for construction lending software startup Built Technology and also led a Series E for digital wealth manager Nutmeg. Incidentally there were also a couple of funding rounds Citi and Goldman Sachs were both a part of, including a Series A for Second Measure led by Goldman and a Series C for Better.com.

Despite the on-going “FinTech vs. traditional banks” storyline, the investments made by JPMorgan, Goldman Sachs, and Citi show once again that the two sides are better off working together. Although current FinTech funding seems on track to fall below last year’s record, the trio are certainly doing their part to bring those figures up. Plus, with seven years of leading the pack under their belt, don’t be surprised if these three institutions continue to invest in helping FinTech startups grow.

Author

Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Bilt Rewards Launches Travel Portal with Benefits for Cardholders

Last year, the startup Bilt made a splash when it announced a new service that would reward users for paying their rent. That premise was then expanded upon with the launch of the Bilt Mastercard, which is issued by Wells Fargo. Now, continuing to capitalize on both the hype of their product and the demand for travel, Bilt has debuted another new offering for customers. This week, Bilt Rewards announced...

Cash App Introduces Round-Up Investing Feature for Debit Card

Debit card customers looking to grow their investments gained a new, automated option today as Block Inc. (formerly Square Inc.) officially announced a new feature for its popular Cash App. Now, customers with the Cash App Cash Card can opt into Round Ups as a means of growing their investments. When this feature is toggled on, Cash App will round up debit card purchases to the nearest dollar and invest...

Marqeta Expands Credit Program with New APIs and More

A FinTech that specializes in creating credit card experiences is rolling out some new features. This week, Marqeta announced what it calls a "significant expansion" of its credit platform. This includes more than 40 new credit APIs that will further help clients craft and launch their own credit card products. Additionally, the company notes an updated intuitive dashboard. Using this platform, businesses can create unique card options that can not...