The so-called fintech, or financial technology, sector had an unquestionably breakout year in 2015, following the initial public offerings of online financing companies Lending Club and OnDeck a year ago. But Levchin's starting to see warning signs. "My general view of the world is that raising money for series B will be harder in 2016 than it was in 2015 in fintech," he says. "There's a perception of oversaturation or at least significant overinvestment in too many small bets being taken by venture capital." Affirm, which closed its own series B round this spring, is starting to get approached by startups offering to sell themselves, Levchin says. "It's still very few and far between right now, but I expect it will increase significantly," he adds. "My guess is that you will see a lot of M&A and failure activity."

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