Zopa, the UK-based digital bank, has raised £75m from existing investors to “cement” its unicorn status.
The funding will be used to meet its growing capital needs and to support mergers and acquisitions that could “kick off” this quarter, the bank said in a statement.
Reuters reported IAG Silverstripe led the equity round, with participation from US hedge fund Davidson Kempner and venture capitalist Augmentum.
Zopa was founded in 2005 as a peer-to-peer (P2P) lending company. It launched Zopa Bank in 2020, and shut down the P2P side of the business a year later.
Since 2020, it has amassed £3m in deposits, £2b of loans and issued 400k credit cards.
The digital bank said its year-on-year revenue is growing by more than 100%. It hopes to have full-year profitability for the first time in 2023.
Jaidev Janardana, chief executive officer at Zopa, commented: “Today’s equity round reaffirms the support of our investors despite the challenging economic environment.
“It is a clear validation of Zopa’s responsible, sustainable and profitable approach to lending, our strong unit economics, and our vision to build Britain’s best bank.
“Zopa takes an agile and dynamic approach to credit risk which means it has continued to lend responsibly in a changing environment.
“As a result, our business remains resilient with record loan origination volumes, stable credit performance comparable to pre-pandemic levels, and continued innovation.”