The Turkish digital banking startup Colendi has raised $65 million in a Series B funding round, boosting its valuation to $700 million. After the oversubscribed round, the fintech hopes to achieve a market capitalization that will grant it unicorn status when it raises additional funds.
Turkish Fintech Colendi Eyes $1 Billion Valuation
Colendi, formerly known as Colendi Yapay Zeka ve Buyuk Veri Teknoloji Hizmetleri AS, has been making strides in digital banking. In 2023, it received approval from Turkey's banking regulator to establish a digital bank and currently has ambitious plans to become an international neobank.
Bulent Tekmen, Colendi's Co-Founder and Chief Executive Officer, expressed confidence in the company's future, stating that the Series B round has raised the necessary investment for the establishment of Colendi Bank.
“The funding will drive the company’s mission to become a major digital banking entity across the EMEA, the GCC, and Turkic republics,” Tekmen added in the interview.
The Istanbul-based fintech and digital services company has ambitious growth plans, with a target of reaching a $1 billion valuation by the end of the year. Colendi already initiated a new funding round in March, aiming to raise over $150 million. Tekmen believes that once this round concludes, Colendi will join the ranks of unicorn startups, a term used to describe companies with a $1 billion or more valuation.
1 Billion Users and Potential IPO
With a user base of 17 million in Turkey, Colendi has set its sights on achieving 1 billion users in the future. To reach this goal, the company plans to expand into emerging markets with large populations, such as Pakistan and Indonesia.
Seeking additional funding to help achieve valuation and user goals, the digital bank also plans to become a public company and pursue a dual listing on stock exchanges in the UK and Turkey. According to the CEO, the fintech should be ready by 2026.
However, competition in the digital banking market is increasing. A few months ago, Monzo, the UK startup in this field, received several hundred million dollars in additional funding, raising its valuation to $5 billion. Brazil's Nubank is also performing well, with its valuation exceeding $40 billion, as it currently aims to achieve revenues surpassing $1 billion.
The market is getting saturated, and what is even worse, the trend to finance fintechs through venture capital has recently experienced a downturn. Global fintech investment fell to $113.7 billion in 2023, a significant drop and the lowest results in the last five years.
The oversubscribed round attracted a diverse group of investors, including Citigroup Inc.'s venture capital arm, Citi Ventures, as well as prominent Turkish companies such as Migros Ticaret AS, Sepil Ventures, Re-Pie Asset Management, Finberg, and Hedef Holding.
