In a significant development for the financial technology sector, OakNorth Holdings has achieved a valuation of $2.3 billion following a substantial $100 million investment from several prominent investors.
The newly acquired capital, sourced from entities such as EDBI of Singapore, NIBC Bank, Clermont Group, GIC, and Coltrane Asset Management, will facilitate OakNorth’s continued expansion within the United Kingdom and its endeavours to scale operations globally.
OakNorth, based in London, distinguishes itself as a bank managed by entrepreneurs specifically for entrepreneurs. The bank focuses on the top 15 per cent of businesses that demonstrate rapid growth and profitability, rather than serving all small to medium-sized enterprises (SMEs). The institution reports that it has doubled its loan book to $2.2 billion since the beginning of 2018, and projects an additional $600 million in lending by the year’s end.
Furthermore, OakNorth estimates that its financial activities have directly contributed to the creation of 8,000 new jobs within the UK. The recent funding is expected to bolster the growth of its ACORN machine financial technology platform, which aims to manage over $5 billion in assets by the close of 2018.
Richard F. Chandler, chairman of Clermont Group, expressed his optimism, stating, “The Clermont Group is delighted to continue its support of ACORN OakNorth. We believe it has the potential to become a globally scalable business and a future champion in the financial services sector.” He added, “By providing capital to the underserved SME segment, ACORN OakNorth reflects the Clermont Group’s philosophy of building and investing in companies that contribute significantly to their nation’s economy.”
The investment has also received commendation from EDBI of Singapore CEO Chu Swee Yeok and NIBC Bank’s Paulus de Wilt. Chu Swee Yeok remarked, “By leveraging machine learning, proprietary and third-party data sources, as well as credit analysis competencies, we believe the platform can help address the underserved SME loans segment in the region, improving financial institutions’ cost efficiency and underwriting processes.” Paulus de Wilt added, “The platform will enhance our efficiency and insights with regards to credit analysis and monitoring, thus enabling us to even better serve our mid-market clients. This collaboration will strengthen NIBC’s tech-based approach and preparation for the future.”
This significant investment underscores the growing prominence of OakNorth in the fintech landscape, reflecting its potential to revolutionise the SME lending market through innovative technology and strategic capital deployment.