Robert McConnell
The Fintech Corridor
Europe’s fintech sector is dynamic, ambitious and increasingly global in outlook. Yet beneath the headlines of record-breaking valuations and the concentration of capital in established hubs lies a fragmented investment landscape. While London, Paris, Berlin and Amsterdam have grown into well-recognised centres of innovation, many promising ecosystems across Central, Eastern and Southern Europe remain underserved. Early-stage and growth-stage fintechs in these regions often struggle to access the funding they require to scale.
This imbalance is not caused by a lack of innovation or entrepreneurial talent. Across the continent, exceptional startups are building products in payments, embedded finance, RegTech, blockchain and financial inclusion. Rather, the challenge stems from structural barriers in the flow of capital. Investors remain risk averse, particularly towards emerging markets and novel technologies, and institutional funders concentrate their attention on a handful of proven geographies. The result is an uneven distribution of opportunity and a persistent funding gap.
Against this backdrop, co-investment has emerged as a critical tool for levelling the field and strengthening resilience. It is not simply a financial mechanism but a structural enabler of collaboration, diversification and connectivity. For Europe’s fintech ecosystem to realise its full potential, co-investment must move from being a marginal practice to becoming a mainstream model of capital deployment.
Defining Co-Investment and Its Relevance
At its core, co-investment refers to multiple investors backing a venture jointly, usually alongside a lead investor but without pooling funds into a managed vehicle. Each investor retains discretion over their own commitment, while benefitting from the due diligence, governance and deal structuring carried out by the lead.
For investors, co-investment offers diversification across regions, sectors and stages while maintaining visibility and control. It reduces risk exposure by spreading commitments and allows entry into deals that might otherwise be inaccessible. Compared to fund-based approaches, it is often more cost-efficient, with fewer management fees and no carried interest.
For startups, the model opens the door to larger funding rounds and more strategic networks. By attracting multiple investors, early-stage fintechs are less dependent on a single backer and gain broader exposure across borders. The process strengthens legitimacy, builds resilience and accelerates international scaling.
In the European context, the relevance of co-investment extends beyond individual deals. It directly supports the European Commission’s Digital Finance Strategy and the ambitions of the Capital Markets Union, both of which emphasise integrated capital markets and more equitable access to finance. In short, co-investment is both a tactical solution and a strategic instrument for policy objectives.
FINE’s Practical Demonstration
The Fintech Investor Network and Ecosystem (FINE) project was designed to test and prove the value of co-investment in practice. Funded under Horizon Europe, FINE set out to address fragmentation by operationalising co-investment mechanisms across borders.
Within Work Package 3, the project delivered a structured methodology to identify, connect and activate investors. More than 280 investors and fintech stakeholders were profiled using onboarding systems and digital platforms such as F6S and Slack. These tools provided structured investor data, enabling thematic alignment and targeted introductions.
The methodology was not theoretical. It was applied in real time through a series of matchmaking events. In December 2024, FINE piloted its first online session, bringing investors together in breakout rooms tailored to thematic interests. This was followed by a focused in-person event in Dublin, a larger interactive simulation in Belfast known as the Syndicate Challenge, and a final pan-European virtual session in June 2025.
Together, these events generated over 60 curated investor-to-investor introductions, far exceeding the initial target of 40. The introductions were facilitated with care, often supported by video calls and structured follow-ups. In each case, the emphasis was on building trust, clarifying expectations and seeding genuine collaboration.
Crucially, FINE integrated exit planning from the outset. Many investors emphasised the importance of knowing how liquidity would be managed before making commitments. The methodology therefore included early discussions on secondary transactions, buyout options and time horizons, which gave participants greater confidence.
The Strategic Value of Co-Investment
The lessons from FINE highlight that co-investment is not simply about securing capital for individual ventures. It plays a wider strategic role in strengthening Europe’s fintech ecosystem.
Firstly, it builds resilience. By sharing risk and pooling expertise, investors can back more ambitious ventures, even in frontier areas such as decentralised finance or compliance technologies. This creates a pipeline of innovation that might otherwise struggle to attract support.
Secondly, it expands visibility for startups located outside traditional hubs. A founder in Romania, Portugal or Malta can gain access to investors from Paris or Dublin, which would have been highly unlikely in the absence of a structured facilitation process.
Thirdly, it creates efficiency. Investors benefit from reduced duplication of due diligence and streamlined deal processes. Startups face less uncertainty in their fundraising efforts, which accelerates scaling.
Finally, co-investment contributes to equity of access. It levels the playing field by directing capital flows to regions and groups that are often excluded. This aligns directly with European objectives on inclusivity, diversity and regional development.
Challenges That Must Be Addressed
Co-investment is not without its difficulties. Misalignment between investors is the most common challenge, particularly around timelines, governance expectations or return horizons. Without careful facilitation, these differences can cause friction and slow decision-making.
Cross-border syndication also introduces complexity in legal, tax and regulatory matters. Each jurisdiction has its own rules and practices, and without clear structures, transactions can stall.
Trust is another critical factor. Information asymmetries between lead investors and co-investors can undermine confidence. To mitigate this, transparency and consistent communication are essential.
These challenges demonstrate why facilitation is indispensable. Passive networking is rarely sufficient. Active structuring, profiling and support are what transform connections into genuine investment outcomes.
Next Steps for Europe
The evidence from FINE makes clear that co-investment works when implemented with structure and purpose. However, to make it truly mainstream, the model must be institutionalised.
This means embedding facilitation functions into ecosystems permanently, not only within time-limited projects. It requires clear governance frameworks, harmonised onboarding processes and tools that investors can trust. It also means creating lightweight but consistent continuity models, such as quarterly events, thematic groups and targeted communication.
Europe is at a critical juncture. Fintech remains one of its fastest-growing innovation sectors, yet fragmentation risks leaving potential untapped. Co-investment offers a tested, scalable way of addressing these gaps while aligning with broader policy goals.
Conclusion
Co-investment is more than an investment structure. It is a strategic enabler for Europe’s fintech future. By pooling capital, aligning interests and creating trust, it transforms fragmentation into connectivity. The FINE project has demonstrated the methodology, tested the formats and proven the appetite among investors. The task now is to embed this approach across the continent so that Europe’s fintech entrepreneurs, wherever they are based, can access the capital they need to grow.