Umeå University's logo

This study aims to generate а comprehensive understanding of how the Covid-19 pandemic has influenced the investment approach of venture capital funds in the Fintech industry. This aims to bring further insights into how venture capital investors react to the Covid-19pandemic. Furthermore, this research aims to identify the degree to which this reaction is аconsequence of rational decision-making instead of cognitive biases. Simultaneously, this paper will provide insights into the future trajectory of the Fintech industry, showing how major global events such as the pandemic can shape its direction whilst bringing new perspectives to similar phenomena. The following theories are tested against the findings in order to clarify if and where specifically new knowledge is created: Innovation diffusion theory, Rational Choice Theory, Behavioural Finance (with the addition of the Adverse Selection Principle), and Real options theory. A qualitative method base, an exploratory approach with а subjective ontological approach, an interpretive epistemological approach, and an abductive research approach was chosen as suitable research philosophies. A literature review was conducted to uncover areas of interest that require more investigation. The effect of the pandemic on the investment approach in the FinTech industry was identified as а key area for research. The research is based on semistructured interviews with venture capital investors in Sweden. Empirical evidence was generated through an interview with eight venture capital investors at relatively high levels of specificity in terms of the professional hierarchy. The empirical data were analysed using interpretive content analysis which is а thematic data analysis approach. The results of this study provide evidence that the Covid-19 pandemic has indeed had a significant influence on the investment approach within the Fintech industry. The empirical evidence suggests that the pandemic has accelerated the adoption of digital solutions which in turn has fostered growth and competition and attracted interest from investors. With this said findings revealed that the Covid-19 pandemic has caused а change in investor approach. Additionally, the participants revealed а multitude of varying responses which indicates complexity and uncertainty in the investment landscape.