Britain’s OakNorth, a start-up specialist bank that provides business and property loans, has been valued at $2.3 billion after closing a $100 million funding round.
OakNorth, which also provides personal and business savings, said on Thursday that the funds would be used to increase the size of its business in Britain and drive sales of its financial technology platform to other banks internationally.
Its valuation, up from $1.4 billion last year, is the latest example of the quickly increasing values investors are putting on financial technology firms, known as “fintechs”, they believe are set to shake-up an industry still dominated by long-established giants.
Rishi Khosla, OakNorth’s co-founder and chief executive, said in a statement the firm, which was launched in September 2015, had been overwhelmed by interest in its fintech platform, dubbed Acorn, which helps banks that adopt it lend to small and medium-sized firms more efficiently.
“Having the support of such a renowned group of international investors is testament to the strength of the platform’s proposition to lenders globally,” he said.
The money raised came from a mixture of new and existing investors, including Singapore’s EDBI, Coltrane Asset Management, Clermont Group, and Dutch bank NIBC, which was one of the first foreign lenders to sign up to the platform.
NIBC CEO, Paulus de Wilt, said in a statement that Acorn would enhance its efficiency and insights in credit analysis and monitoring, strengthening its technology-based approach.
The platform works by automating the application of credit analysis approaches normally used for larger corporate loans to lending to smaller firms, making the process quicker.
OakNorth said Acorn has opened offices in New York and Singapore, expects to add another 50 people to its team in the near term and will have more than $5 billion of assets under service by the end of the year.
In Britain, the lender has doubled its loan book to $2.2 billion since the start of the year and expects to lend another $600 million by the end of 2018.