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 Extends Rent Day Promotion for Black Friday and Beyond

In October, the unique Bilt Mastercard unveiled its inaugural Rent Day promotion, which included the opportunity for cardholders to earn double rewards and nearly all of their purchases on the first of the month. That deal returned in November alongside the addition of a United Airlines status match offer and more. Now, just in time for Black Friday, Small Business Saturday, and Cyber Monday, Bilt is extended December's Rent Day...

Venmo App Adds Charitable Giving Interface

Although Thanksgiving and retail holidays such as Black Friday, Small Business Saturday, and Cyber Monday may be on the minds of many people, a popular peer-to-peer payment app is looking ahead to Giving Tuesday. This week, Venmo announced the rollout of a new interface that will make it easier for users to discover and donate to various charities. The feature is now live in the latest version of the Venmo...

American Express Introduces New Credit Card Approval Process

For some consumers, applying for a new credit card can be anxiety-inducing as there's a chance that they could not only be declined for the product but also have their credit impacted by the credit inquiry. To give these applicants better peace of mind, American Express is rolling out a new approval process. Amex has announced a new pilot program for its U.S. Personal Cards (meaning non-business cards) that will allow...