Zopa, a London-based fintech, has secured £68m in funding, led by A.P. Moller, as it gears up for the launch of its current account in 2025.
- The funding reaffirms Zopa’s status as a unicorn, marking it as an ‘up-round’ compared to previous funding stages.
- A.P. Moller Holding, a key investor, acknowledges Zopa’s customer-centric approach and confidence in its profitable business model.
- Achieving annual profitability in 2023, Zopa reported a pre-tax profit of £15.8m and anticipates doubling profits in 2024.
- Despite readiness for an IPO, Zopa faces uncertainties due to the current lack of listings in London.
Zopa, an innovative fintech firm based in London, has successfully raised £68 million in a funding round prominently led by Denmark’s A.P. Moller, aligning with the company’s strategic plans to introduce a new current account product by 2025. This pivotal investment strengthens Zopa’s position in the fintech market, reaffirming its unicorn status and confirming the round as an ‘up-round’ in comparison to previous funding phases. Though the precise valuation remains undisclosed, there is marked investor confidence in the firm’s strategic direction.
Chetan Mehta, Head of Growth Equity at A.P. Moller Holding, expressed trust in Zopa’s robust business foundations, highlighting the firm’s profound focus on delivering significant value to UK consumers’ financial lives. Mehta stated that the latest investment underscores their belief in Zopa’s business model which aligns closely with sustainable, long-term growth strategies.
Marking a financial milestone, Zopa achieved annual profitability for the first time in 2023, recording a substantial pre-tax profit of £15.8 million—an impressive turnaround from a £26 million loss reported in the preceding year. The firm projects to double its profits in 2024, backed by an anticipated 35% annual increase in revenue. Such financial health and growth potential bolster the anticipation surrounding Zopa’s long-anticipated initial public offering (IPO).
Zopa’s CEO, Jaidev Janardana, conveyed to the Financial Times that the company is well-prepared for its IPO aspirations, ideally to be conducted within London. However, the current climate of sparse listings in the city has led some technology firms to postpone their IPO plans iteratively, posing challenges to Zopa’s aspirations.
In addition to its financial maneuvers, Zopa has strategically partnered with Octopus Energy, Britain’s largest electricity supplier, to delve into the £23 billion renewable energy sector through an innovative ‘buy now, pay later’ solution. Furthermore, the company has collaborated with retail giant John Lewis to provide personal loans to its extensive customer base of 23 million, broadening its consumer reach and reinforcing its service portfolio.
Zopa’s recent funding and strategic partnerships underscore its solid position and potential for growth in the fintech sector amidst a challenging market landscape.
