FinTech: Revolut In Talks To Raise Upto $1B At A Valuation Over $30B
Sky News reported that SoftBank’s Vision Fund 2 is among several potential investors.
Revolut, the British challenger bank, and its advisers have sounded a select group of investors on an investment between $750m (£542m) and $1bn (£723m), according to Sky News. The report, which cited “industry sources,” also said SoftBank’s Vision Fund 2 is one of those investors, and that the round, if successful could value Revolut at a massive $30 billion or more.
That tag would catapult Revolut into the ranks of the most valuable fintechs based in Europe.
Sky News said the sheer size of the deal meant only the largest private investment players, such as US-based Tiger Global Management or Dragoneer Investment Group would be part of the investor group.
A “halo effect” from the Klarna funding round?
Sky News speculated that Revolut’s valuation may have received a leg-up from last month’s raise of $639 million by Swedish fintech Klarna at a staggering $45.6 billion valuation, post money. Note that Klarna had raised $1 billion in March at a tag of $31 billion – so its valuation jumped 50% in a matter of three months!
A similar turn of events seems to be playing out at Revolut. According to Sky News, shareholders were given the impression its next capital-raising would value the fintech at somewhere between $10 billion and $15 billion as recently as three months ago.
Investors lap up growth
Revolut reported an operating loss of £201 million for the year ended December 31, 2020, up +88% over 2019.
However, at £4.6 billion (end-December), customer balances surged 57%, while personal customers numbered 14.5 million, up 45%.
According to Chief Financial Officer, Mikko Salovaara, revenue in the first quarter of 2021 jumped 130% over the same quarter last year, with the number of personal customers at quarter-end totalling 15.5 million.
“Gross profit grew by more than 300% vs Q1 2020, with meaningful gross margin expansion driven by our product mix and continued ownership mentality on cost control,” he added.
The company is pushing expansions internationally, including in India, Latin America and South Korea.
Sky News said FT Partners, the US-based fintech-focused investment bank, is overseeing Revolut’s latest fundraising.
FT Partners is said to have advised Dutch payment service provider Mollie on its closing last month of US$800 million in a Series C funding round led by Blackstone Growth.
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