Vive la France, indeed! One week after French payment app Lydia announced a $45 million fundraising, neobank Qonto reports that it has just closed the largest funding round to date for a French fintech.
French challenger bank Qonto has raised $115 million (€104 million) in Series C funding. The round was led by Tencent and DST Global, and also featured participation from existing investors Valar and VC Alven. Two angel investors, Taavet Hinrikus (TransferWise co-founder) and Ingo Uytdehaage (Adyen CFO), were also involved in the financing. Qonto now has raised a total of more than $150 million (€136 million) in capital.
The company will use the funds to fuel its expansion into three new markets just entered in 2019: Italy, Spain, and Germany. The investment will also help Qonto strengthen its position in France where the majority of its 65,000 SME and freelancer customers do business. The funding will help the company grow its headcount from 200 to 300 within a year, and help Qonto secure a credit institution license by year’s end that will allow it to become a bank.
Investors in the firm credited Qonto for its ability to efficiently provide financial services for an underserved sector such as freelancers. Managing Partner for DST Global Tom Stafford praised the company for “using technology to change banking for small and medium size businesses from a source of friction to a source of competitive advantage.”
Founded in 2017, Qonto offers freelancers and SME business owners a range of financial services from streamlined account opening and expense management to real-time notifications and visibility into cash flow. The company was named one of the “hottest startups in Paris” by Wired U.K. last August.