The deal
It is a well-worn path. Zopa is again raising fresh capital-and still flagging up that it is on course to post its first profit.
This time, Zopa has raised £75m. In February this year, Zopa also raised £75m and as with this latest fundraising, gives no valuation but references its unicorn status.
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Past fund raising included $303m raised in 2021 in a fundraising led by Softbank Vision Fund 2 and backed by existing investors including Silverstripe, Northzone and Augmentum. An earlier funding round in 2021 raised $28m.
Why it matters
Notwithstanding the tougher economic climate, Zopa is still successfully raising capital. As usual, Zopa references that the fresh capital will ‘fuel its continuous growth and expansion.’ In a business update, Zopa reports that it has attracted £3.5bn in deposits, more than £2 billion of loans on balance sheet, and issued 470,000 credit cards. Total customer numbers have now reached 1 million. Optimistically, it forecasts that it will serve 5 million customers by 2027. Zopa says that it now generates £250m in revenue.
Zopa originally set up in 2005 as a peer-to-peer (P2P) firm. When that proved to be unprofitable, it closed its P2P unit to focus on digital banking. It then targeted the loss-making BNPL sector in another strategy shift in 2022.
Jaidev Janardana, CEO Zopa Bank said: “Today’s financing is a clear market validation of Zopa Bank’s financial performance. It points to strong investor confidence in its growth and in its ability to deliver strong financial performance despite the economic uncertainty.
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