Zopa reportedly in talks to raise $100m ahead of IPO

Rounding off a big year for Zopa, it looks like the digital bank is looking to raise another round of funding ahead of seeking a public listing.

Zopa is currently in “detailed negotiations” with both new and existing shareholders about raising around $100m according to Sky News.

Sources told the news site that a number of blue-chip financial institutions were involved in the discussions.

According to one investor that spoke to Sky News, the fundraising is expected to value the bank in excess of the roughly £750m valuation it got almost a year ago.

A spokesperson for Zopa told AltFi that as the bank continues to grow, raising additional capital is part of the journey.

They said there is currently nothing to announce, however.

The former peer-to-peer lender pivoted to banking after winning its licence in 2018, and it looks like the move has paid off. 

The consumer lender hit profitability just 21 months later and saw revenues more than double last year to £70.5m as of July, with lending rising by more than 400 per cent.

Zopa had originally been set on a 2022 IPO, but one year after first sharing the intention, the bank reportedly decided to delay it.

In June, CEO Jaidev Janardana told CNBC at Money 20/20 in Amsterdam that “the markets have to be there” for Zopa to go public.

“The markets are not there — not for fin, not for tech,” he said.

“We will just have to wait for when the markets are in the right place,” he added. 

This round would add to the huge $300m the bank raised last October in a “pre-IPO” funding round led by Japanese telecoms giant Softbank.

Maybe the right time is approaching for Zopa and the markets are right, or perhaps it is just getting prepped with some fresh funding for when the time does come.