UK challenger bank OakNorth has raised £154m in equity, reaching a valuation of $1.3bn.
The firm, which seeks to provide fast debt finance (£500,000 to £20m) to UK businesses, drew investment from The Clermont Group, Toscafund and Coltrane.
OakNorth received the funds in exchange for a 16% stake in the business.
OakNorth will use the funds to launch ACORN – its AI powered data platform – worldwide.
Rishi Khosla, CEO and co-founder of OakNorth, commented: “It has been an incredible and extremely humbling two years for OakNorth – we’ve had the chance to work with some of the UK’s most inspiring and ambitious entrepreneurs, and have helped over 150 businesses achieve their growth ambitions. While we have reached an £800m loan book in two years, we know that this represents just a fraction of the businesses that need financing support. This funding will enable us to boost our lending by an additional £1.5bn and add thousands more jobs and homes in the UK.
“Rather than building a technology platform and then going to market trying to sell it, we wanted to build the platform and prove the concept in a highly regulated and highly competitive market – the UK – via OakNorth. Through ACORN we will be able to help lenders around the world unlock the underserved and underestimated market for bespoke loans to SMEs.”
OakNorth says it is already working with clients including LEON, Galliard Homes, Frogmore, Brasserie Blanc, Strawberry Star, and The Collective.
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