UK digital bank Revolut is now valued at $5.5bn after a fresh round of funding, making it one of Europe’s most valuable fintech startups despite still being a loss-making business.
The Series D $500m fundraising was led by US-based investment firm TCV, which has previously invested in some of the world’s largest companies, such as Facebook, Netflix, Airbnb and Spotify. The bank also attracted backing from existing investors such as Ribbit Capital, DST Global, Lakestar and GP Bullhound.
Revolut said the cash will be used to roll out its banking operations, strengthen product development in other markets and build up its subscription accounts. This funding round means the London-based fintech has so far raised $836m from investors.
The app-only bank competes with such UK firms as Monzo and Starling, as well as German rival N26 which earlier this month said it would leave the UK because Brexit meant it would mean it would be more difficult to operate in Britain.
Revolut ‘on a mission’
Revolut, which employs 2,000 staff, is now tied with Swedish e-commerce payments start-up Klarna as the most valuable fintech start-up in Europe, according to data firm CB Insights.
The additional funding means Revolut is now three times more than its initial valuation of £1.7bn in 2018. The company, which claims 10 million account holders, offers stock trading, cryptocurrency, business banking, loans and current accounts in the UK.
The bank was founded by former Credit Suisse trader Nik Storonsky (pictured, right) and former Deutsche Bank systems engineer Vlad Yatsenko (pictured, left), in 2015.
Revolut co-founder and chief executive Nik Storonsky said: “We’re on a mission to build a global financial platform – a single app where our customers can manage all of their daily finances, and this investment demonstrates investor confidence in our business model. Going forward, our focus is on rolling-out banking operations in Europe, increasing the number of people who use Revolut as their daily account, and striving towards profitability.”
Similarly to rivals Starling, and Monzo, Revolut is yet to make a profit, its full-year losses doubled in 2018 to £32.8m.
Last year, the bank beefed up its senior management team including the appointment of asset management veteran Martin Gilbert as chairman, following reports about a ‘toxic’ work culture that put signing new account holders above all else, as well ascompliance issues.