British fintech Zopa hits $1b valuation with SoftBank investment

Photo: Bloomberg

British digital bank Zopa has raised $300 million from investors including Japan’s SoftBank Group, it said on Tuesday, as the lender looks to expand its business ahead of a possible listing as soon as next year.

The funding round values Zopa at around 750 million pounds ($1.03 billion), a source familiar with the details of the transaction told Reuters.

SoftBank identified us as the clear leader when it comes to digital consumer lending in the UK, and they are also big believers in the use of AI and machine learning for lending and pricing, which we have been doing for years,” Chief Executive Jainav Janardana told Reuters.

The cash injection via SoftBank Group’s Vision Fund 2 is the latest in a string of investments into British financial technology firms by the Japanese conglomerate.

It also holds stakes in OakNorth, which lends to small businesses, and digital banking app Revolut which in July rocketed to a $33 billion valuation after an $800 million funding round led by SoftBank.

Zopa’s new valuation marks a significant turnaround since media reports in December 2019 estimated it at 354 million pounds, after one of its investors wrote down its stake in the lender amid struggles for the peer-to-peer lending sector where Zopa originated.

The funding round puts Zopa on track for a long-mooted initial public offering in London as soon as the fourth quarter of next year, Janardana said.

Zopa also aims within the next year to expand into the booming “Buy Now, Pay Later” sector in Britain, he said, joining other lenders pouring into the credit product which lets shoppers defer payments for goods such as clothes and electronics.

The deal on Tuesday was announced as part of a summit in London attended by Prime Minister Boris Johnson, top financiers, industry leaders and British royals and aimed at drumming up investment in the country.

Reuters

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.