The qualities to look for in a RegTech partner & Global RegTech funding soars in H1

5 qualities to look for in a RegTech partner

Look for these five important qualities when evaluating regtech partners to be sure you get not only a useful technology solution, but also a knowledgeable, supportive team of professionals who prioritize your business needs, collaborate with you, configure the system to meet your unique processes, and provide responsive support long after go-live day.

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Research highlight

RegTech deals projected to drop by a third for 2024 as investors focus on larger deals

Key Global RegTech investment stats in H1 2024:?

• Global RegTech deal numbers projected to drop by a third compared to the 795 deals completed last year
• Average deal value increased by 37% as investors focus on larger deals
• Claroty secured the biggest RegTech deal globally for the first half of the year with a $100m funding round

H1 2024 marked a challenging period for the global RegTech market, which experienced a sharp reduction in both financial backing and deal volumes. Only 246 deals were recorded in the first half of the year, marking a 45% decrease compared to the 444 deals completed in H1 2023. Funding also saw a notable drop, with RegTech companies raising $3.9bn in H1 2024, a 25% decrease from the $5.2bn raised in H1 2023. If this trend continues, the projected total for deal activity in 2024 would be around 492 deals, a 33% decrease from the 795 deals completed in 2023.

The average deal value in H1 2024 was approximately $15.9m, reflecting a 37% increase from the $11.6m average in H1 2023. This rise in average deal value indicates that while there has been a sharp decline in the number of deals, investors are focusing on larger, more substantial investments. This shift suggests that investors may be more selective, prioritising well-established RegTech companies with proven scalability and market traction amidst a more cautious investment climate.

Claroty, a leader in RegTech and the protection of cyber-physical systems, successfully completed a strategic growth financing round, securing $100m, making it the largest deal for H1 2024 globally. This significant financial boost comes from a group of prestigious investors, including Delta-v Capital leading the equity charge, complemented by contributions from AB Private Credit Investors at AllianceBernstein, Standard Investments, Toshiba Digital Solutions, SE Ventures, Rockwell Automation, and Silicon Valley Bank, a division of First Citizens Bank. The company specializes in safeguarding cyber-physical systems (CPS) across various sectors, including industrial, healthcare, commercial, and the public sector, while ensuring regulatory compliance through comprehensive risk management and monitoring solutions. By integrating advanced RegTech solutions into its offerings, Claroty helps organizations navigate complex regulatory landscapes, ensuring compliance and robust protection for the Extended Internet of Things (XIoT). The newly acquired funds are earmarked for scaling Claroty’s platform across key verticals and regions, enhancing product innovation, and fostering strategic partnerships, supporting the company's efforts in expanding its reach within the public sector and critical infrastructure industries across the Americas, EMEA, and Asia-Pacific.

RegTech news

• The rise of Agentic AI: How it’s redefining efficiency and compliance in finance?- The next significant development in artificial intelligence (AI), referred to as “agentic AI,” represents a crucial evolutionary step for technology within the finance sector and beyond. Read the full story here.
• Salv’s new e-book explores why collaboration is key in the battle against APP fraud - A new e-book, co-created by Salv, Thistle Initiatives, and We Fight Fraud, offers a deep dive into the mechanics of APP (Authorised Push Payment) fraud, providing readers with a view from the victim’s perspective. Read the full story here.
• Harnessing technology for efficient financial crime investigation - In the realm of financial crime investigation, government officials are inundated with a vast amount of data that demands meticulous scrutiny. Available databases are packed with critical data on beneficial ownership, corporate structures, and various risk indicators, such as those associated with shell companies and financial performance. Read the full story here.

Regulation news

• UK to overhaul retail investment disclosures with new CCI framework -?The UK Government and the FCA have announced plans to overhaul retail disclosure regulations to enhance transparency and investor confidence. Read the full story here.
• US regulators extend comment period for Bank-FinTech partnerships - US regulators have decided to prolong the comment period on bank-FinTech relationships until October 30, 2024. Read the full story here.
• UK government takes steps to combat late payments to small businesses - The UK government has announced a package to support small businesses and the self-employed by addressing the persistent issue of late payments. Read the full story here.

RegTech Deal news

• ACA Group unveils advanced archiving in ComplianceAlpha upgrade - ACA Group has announced a major upgrade to its eComms Technology Solutions suite within the ComplianceAlpha platform. Read the full story here.
• EasyDMARC secures $20m in funding to enhance global email security operations - EasyDMARC, an Armenian startup specializing in email security, has successfully closed a $20m funding round. Read the full story here.
• c/side secures $6m in seed funding to combat browser-side cyber threats - c/side, a CyberTech specializing in the protection of browser-side third-party scripts, has secured $6 million in seed funding. Read the full story here.

CyberTech news

• Intezer secures $33m in Series C to boost AI-driven cybersecurity capabilities - Intezer, a cyber leader renowned for its AI-powered security operations technology, has pulled in $33m in Series C funding. Read the full story here.
• BlackCloak raises $17m in Series B funding led by Baird Capital - BlackCloak, a leader in Digital Executive Protection, announced it has successfully completed a $17m Series B funding round. Read the full story here.
• RunSafe Security secures $12m in Series B to bolster global cyber defenses - RunSafe Security, a CyberTech known for its unique software immunization process, has completed a $12m Series B financing round. Read the full story here.

Other RegTech news

• Navigating the maze of compliance search in unified communications - Compliance search and discovery across unified communications platforms present substantial challenges. Those tasked with governance responsibilities, such as audits, investigations, and e-discovery, find themselves grappling with the complexities and sheer volume of modern communications. Read the full story here.
• How cloud technology is revolutionising financial crime compliance - In the evolving financial landscape, institutions are increasingly harnessing cloud technology to bolster their financial crime compliance strategies. Read the full story here.
• The crucial role of AI in enhancing compliance management for FinTech - In the complex landscape of financial regulation, compliance managers play a pivotal role, often finding themselves at the forefront of critical challenges. Read the full story here.