Digital bank Zopa has received £75 million in funding from existing investors IAG Silverstripe, Augmentum Fintech, and Davidson Kempner Capital Management LP. The CEO of Zopa, Jaidev Janardana, stated that the investment will allow the company to serve more customers across more product categories and is expected to result in full-year profitability in 2023.
Zopa provides financing and savings accounts and became profitable for the first time in April 2022, just 21 months after receiving a full United Kingdom banking license. The funds from this round of investment will be used to support the company’s growing balance sheet and for potential M&A activities.
With the expectation of reaching profitability and the additional funding, the bank is closer to a public market debut and a London IPO. A spokesperson for the company stated that they still plan to go public but will carefully evaluate the investment climate when markets reopen and will not rush into a hasty decision.
Zopa previously indicated that they could have been ready for an IPO as early as Q4 2022, once they have demonstrated a consistent track record of profitability. The London listing is preferred due to the high demand for profitability and strong unit economics among investors.