Revolut Strikes New Finance Deal; Valued As Britain’s Biggest Ever FinTech

Revolut has been valued as Britain's most valuable ever fintech company in its latest fundraising rounds.

July 16, 2021
Revolut Strikes New Finance Deal; Valued As Britain’s Biggest Ever FinTech
Matt Crabtree

Written By

Matt Crabtree

 
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Revolut has secured new funding which has in turn made its worth climb to £24 billion, making it the most valuable fintech company in British history.

The new funding round raised over £570 million for the company, with SoftBank’s Vision Fund and Tiger Global Management the two companies leading the way. Both investors already have major stakes in popular tech businesses around the world.

Huge Rise In Valuation

The new valuation is particularly shocking as only three months ago it had been predicted that fundraising would place the company somewhere between £7.2 billion and £10.8 billion. More recently, Bloomberg News suggested that a deal was close that would see the company valued at closer to £14 billion as recently as a month ago.

It shows the dramatic rise of Revolut’s value, especially when compared to the fundraising it underwent last year where US-based investors TCV and TSG Consumer Partners added money to the company at a valuation of just under £4 billion.

In the last 12 months, the banking and payments app has seen its value grow by six times, despite the fact that it has seen its losses double. It is indicative of the potential and predicted growth not only in Revolut but in digital banking and payment companies across the whole of Europe, aided by the influx of US-based investors.

Nik Storonsky, Revolut’s chief executive (and founder), only recently said that the company was in early talks about raising funds, but that it wasn’t short of usable capital. It was in May that the company disclosed their latest accounts for 2020, with total losses of just over £200 million.

However, that was mainly attributed to considerable staff cost increases due to the rapid growth of the business, with the company turning a profit in November and December.

The company is in the process of applying for a UK banking license that would see it able to offer banking services such as deposits in the UK. Currently, UK users must carry out all transactions digitally via an account held elsewhere in Europe.

Digital Tech Investment

Several digital fintech companies are outperforming expectations in fundraising. Indeed SoftBank’s Vision Fund has investments in other popular techs, such as Uber Technologies and Klarna, the buy-now-pay-later platform.

Indeed, Klarna was recently valued at £33 billion itself, something which is believed to have been a factor in raising the valuation of Revolut. It shows that even loss-making technology companies may be able to outperform many traditional FTSE-100 companies in valuations, with a view to the future potential and growth of the market.

For perspective, Revolut being placed in the £24 billion range values it at more than seventy-five per cent of the companies that make up the FTSE-100.

Another UK-based fintech that is about to list in London is Wise, a payments service. It is expected to be valued at around £5 billion.

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