Fintech unicorn Starling Bank has topped up its coffers with a £50m cash injection from Goldman Sachs Growth Equity. The investment is an extension of the digital bank’s Series D round, which was announced in March 2021.
The extra money brings the total value of the round from £272m to £322m. The UK neobank’s value remains at the £1.1bn mark achieved last month. Starling has been profitable since late last year.
The original Series D raise was led by financial services company Fidelity Management and Research. The Qatar Investment Authority, Railpen and Millennium Management also participated in the round.
Unsurprisingly, Starling will use the new money influx – which is still subject to regulatory approval – to grow its 6% share of the UK market and to expand its user base. Starling currently has two million current accounts, including 350,000 business accounts. It will also use the fresh capital for planned European expansion.
Starling has talked about expanding to the mainland for a long time. For instance, when the startup raised a £60m funding round in February 2020, it also hinted about plans to expand its company reach.
“Securing the support of another global financial heavyweight demonstrates the strength of demand from investors and represents yet another vote of confidence in Starling,” said Anne Boden, founder and CEO of Starling Bank. “Goldman Sachs will bring valuable insight as we continue with the expansion of lending in the UK, as well as our European expansion and anticipated M&A.”
Starling is already facing stiff competition in the UK from SME-focused neobank OakNorth, which turned a profit just six months after its launch in 2013; Revolut; and Monzo. The latter was founded in 2015 by a group of Starling employees that had broken away in the aftermath of a reportedly toxic internal power struggle.