Starling Bank, one of the fastest-growing digital challenger banks in the UK, recently confirmed that it has completed an internal fundraise of £130.5 million. The new investment, which saw participation from the company’s all existing investors, has increased the pre-money valuation of Starling Bank to £2.5 billion.
Starling Bank has highlighted the company’s consistent growth in the past few months. Since its launch in 2017, the digital challenger bank has opened nearly 3 million accounts. The number includes over 450,000 SME accounts.
“This will enable us to continue our growth and to build a war chest for acquisitions. We are looking at a number of potential targets,” a spokesperson of Starling Bank said in a recent announcement.
Starling is one of the few digital challenger banks in the UK to post consistent profits. Headquartered in London, the company has offices in Southampton, Cardiff and Dublin.
Last week, the Financial Conduct Authority (FCA) released the outcomes of its review regarding the risk assessment by challenger banks and found some issues in challenger banks’ financial crime controls.
Growth
Starling Bank offers a broad range of services, including B2B Banking as a Service and Software as a Service proposition. Recently, the company expanded its presence with the acquisition of Fleet Mortgages in a £50 million cash and share deal.
“The fundraising follows a period of sustained growth for the bank. Since launching its app five years ago in May 2017, Starling has opened nearly three million accounts, including more than 450,000 SME accounts, accounting for 7.5% of the UK SME banking market. The bank has reported monthly profitability every month since October 2020 and completed a £322 million Series D funding round in April 2021. Starling made its first acquisition in July 2021 of specialist buy-to-let mortgage lender Fleet Mortgages,” Starling Bank added.
