Today's business and finance round up 20th October 2021
💰British fintech startup reaches $1bn valuation
20th October 2021
Good morning Nigel, Neville, Carol and Maureen - remember the names because they could be heading into extinction. That’s according to the latest data from the Office of National Statistics that showed that last year less than three babies in England and Wales were given these names. Rather concerningly the name Lucifer is more popular with 15 children bearing the name.
- British fintech startup reaches $1bn valuation
- Moneysupermarket snaps up Quidco
British fintech startup reaches $1bn valuation
What’s going on?
Online lending firm Zopa has secured $300m of investment taking its valuation to $1bn, making it the latest British fintech to achieve “unicorn” status.
Why is this important?
Zopa began life as a peer-to-peer lender, connecting investors with borrowers through a single online platform. Since launching in 2005 it’s pivoted toward becoming a fully fledged bank offering savings accounts and credit cards as it takes on traditional high street banks.
So far it’s attracted £700m in deposits and 150,000 credit card customers.
Zopa is one of several British start-ups that have emerged in the past decade disrupting the banking sector. Rivals like Monzo, Revolut and Starling have gained millions of users with fee-free savings accounts and foreign exchange services powered through a mobile app. But profits have been hard to come by for these firms with millions poured into to acquiring customers and building the tech.
Zopa’s latest funding round of $300m was led by SoftBank, the Japanese tech and investment conglomerate.
The company plans to use the funding to continue expanding the products that it offers to its customers, which will expand on the theme of providing tools to consumers to help them build and manage their savings better.
The huge cash injection puts Zopa on track to list on the public markets by next year so long as it can prove that it can turn a profit in the near future.
Moneysupermarket snaps up Quidco
Price comparison group Moneysupermarket has bought Quidco the cashback site from its founders for £101m.
Quidco is the second largest cashback provider in the UK, with nearly 1m members and was founded in 2005.
It offers cashback at about 4,500 sellers, including retailers and travel companies. In the year to July it generated revenue of £59m and profit of £8m.
As well as the price comparison site Moneysupermarket also owns consumer website Money Saving Expert. The company says the deal will broaden its revenue base and aligns with its purpose of saving households money.
Moneysupermarket hopes Quidco will benefit from its data and technology platform and make the cashback site more slick.
Details of the transaction came as the group announced that revenue fell 10% between July and September driven by the turmoil in the energy market.
The steep rise in wholesale gas prices this year and especially in the past month has meant customers are not able to save money by switching energy providers. This channel represents about 15% of the company’s revenue and it says it does not expect switching to return this year.
This has hit the share price which has fallen by over 20% since September. But news of the Quidco takeover sent shares up 8% on the day to 219p.
Stat of the day
In the UK nearly £400m is wasted on unused gift cards every year
Other stories to keep you in the loop
- Tesco follows Amazon as it launches its first ever checkout-free supermarket store
- Morrisons shareholders wave through £7bn takeover
- Boris Johnson and Bill Gates launch £400m partnership to boost green investment
- Rail commuters on track for compensation worth almost £100m
- $1bn Gorillas fundraising shows appetite for growth in rapid grocery delivery sector
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