GoHenry's focus on growth, not profitability, says co-founder, following first European acquisition

GoHenry's focus is on growth, not profitability, says Louise Hill, the co-founder of the neobanking fintech for children, which yesterday (Monday) announced it had snapped up a leading teen banking fintech in France and Spain.

GoHenry has acquired French fintech Pixpay for an undisclosed amount, marking its first move into the European market.

GoHenry, which launched in the UK in 2012, is now following a three-pronged geographical growth path: the UK, the US, and Europe, says Hill.

The brand launched in the US under 'GoHenry' in 2018 and gave serious consideration to launching the GoHenry brand in Europe too, exploring a “buy or build” project, but Hill said the purchase of Pixpay means it can now take a bigger step in Europe.

“We also looked at the competitive market across Europe and assessed all of the players in that market, and there are quite a few now, and Pixpay were very much the strongest,” Hampshire-resident Hill tells AltFi, who runs the multi-million-pound bank card firm.

Hill, GoHenry’s chief operating officer, said that Pixpay has shared values and ambitions with GoHenry.

“The team think very much as we do. It’s financial education that we are trying to deliver and what our ultimate mission is," she says.

The two businesses are fundamentally similar, with pre-paid cards and an app to help teach kids about money, though there are some differences.

For one, Pixpay is pitched at a slighter older demographic.

“Every market is slightly different, and the French market, in particular, I know Pixpay feel, is slightly more conservative and that is why they have pitched their service from aged 10.”

Hill says the newly-enlarged business will consider whether to launch Pixpay, which is also expanding into Italy and Germany, or GoHenry brand in other European markets.

GoHenry now has “well over 2m” users across the US and UK, but Hill won’t break this figure down between countries.

“The US has been growing strongly,” she says.

“Since we launched there, it has triple-digit growth every year, and we’re very happy with how that is expanding. No, it doesn’t mean the focus is switching to Europe, it means the focus is now in three places, it is on Europe, the US and the UK.”

GoHenry more than doubled its revenues during the pandemic, which the firm is “very proud of” and last year's revenues came in at around £35m.

GoHenry was profitable in 2020 but not last year.

It is a conscious decision to “invest in growth" and not strive to be profitable, says Hill, pointing to investments it had made into launching its Junior ISA, Money Missions (a gamified, interactive tool designed to educate children aged 6-18 and promote better financial literacy) and customer base.

GoHenry has not made job cuts or other cuts this year, despite a challenging economic environment.

“It is a tough time for the private sector, but we haven’t made any cutbacks, we don’t see the need to do that, we are in very good financial shape," Hill adds.