With FinovateEurope set to make its German debut next February, it is especially gratifying to hear that investors are voting with their dollars when it comes to identifying and backing innovative European fintechs.
Hamburg-based online lender and POS financing firm Kreditech announced late last week that it has raised $24 million (€22 million) in funding. The round, led by Runa Capital, takes the company’s total equity financing to more than $519 million, and will be used to deepen its presence in existing markets, especially in Asia.
“I am really excited about our growth plans in India,” Kreditech CEO David Chan said. “We hold a first-of its-kind digital NBFC (non-banking financial company) license in a large and fast-growing market. We have been successful in finding our niche and have established the right proof of concept. Now it’s time to scale up while a key target customer segment remains unaddressed by the competition.”
Also participating in the round were existing investors HPE Growth and Amadeus Capital Partners, as well as private German investors.
Kreditech specializes in offering financing products to “near-prime” customers. In 2014, the company made its Finovate debut, demonstrating how its self-learning, proprietary algorithm accurately assessed the creditworthiness of loan applicants in less than a minute. The technology leverages up to 10,000 current data points to provide better insights into the finances of underbanked applicants who might otherwise struggle to secure credit.
The funding news for Kreditech comes as the company previews its 2018 financial statement, to be released in October. Chan said that Kreditech was “on track” to hit profitability targets, and added that the company was up to the task of “rapid, profitable growth.” In its funding statement, the company noted that it is aiming for $1 billion euros in revenue by 2025.
With more than 300 employees in seven countries and lending operations in India, Poland, Russia, and Spain, Kreditech is also developing regional centers of excellence and tech centers in its native Poland, as well as Romania and Thailand. The company was founded in 2012.