Funding Circle announces $100 million equity investment to help thousands more small businesses globally
12 Jan 2017
- Round led by Accel, with participation from other existing equity investors
- Investment comes as UK business reached profitability for Q4 2016
- And as lending through Funding Circle passes £2.5 billion globally, benefitting over 25,000 businesses in the UK, US and Europe – creating more than 50,000 new jobs
Funding Circle, the world’s leading lending platform focused exclusively on small business finance, today announces it has raised a further £82 million ($100 million) in equity capital. Led by Accel, the round saw participation from existing Funding Circle investors, including Baillie Gifford, DST Global, Index Ventures, Ribbit Capital, Rocket Internet, Sands Capital Ventures, Temasek and Union Square Ventures.
The new investment follows significant growth at Funding Circle over the last 12 months. Globally, investors on the Funding Circle platform lent more than £1.1 billion to small businesses in 2016, with approximately £400 million lent in Q4 alone, a record amount for any SME direct lending platform. In addition, in Q4 Funding Circle UK recorded 90% year-on-year growth and reached profitability.
Chancellor of the Exchequer, Philip Hammond, said: “Funding Circle has become a real success story for British Fintech and news that it has attracted £80 million of investment is further evidence of the growing importance of this industry. This is another vote of confidence in a UK firm that plays an important role in our economy – helping businesses to grow and create jobs.”
Samir Desai, CEO and co-founder of Funding Circle, said: “Funding Circle is changing the financial landscape for small businesses and investors globally, ensuring a better deal for everyone and helping to create a more sustainable and fairer economy. Today’s news is the next step on our journey to create a category-defining company that helps thousands of small businesses access finance and create jobs. Over the next 12 months, lending through the Funding Circle platform will create a further 50,000 new jobs, supporting economic growth in the UK, US and continental Europe.”
Funding Circle facilitates lending to small businesses from investors including 60,000 individuals, local and national government, the European Investment Bank and financial institutions such as pension funds. The investment comes as lending to small businesses through the platform passes £2.5 billion globally, benefitting over 25,000 businesses and creating 50,000 new jobs.
Harry Nelis, Partner at Accel, said: “We’ve been impressed by the Funding Circle team since our early investment in the company. It has achieved significant growth across multiple international markets by delivering an appealing lending option to SMEs and attractive risk-adjusted returns to investors on the platform. This investment makes Funding Circle the largest and best capitalised SME lending platform in the world, and we’re thrilled to continue to support its journey.”
Launched in 2010, the Funding Circle model has opened up small business lending to a wide range of investors, improving competition in the market, creating jobs and reducing dependency on bank lending. This latest investment is recognition of the efficiency of the direct lending model, and its ability to channel much-needed funds to the real economy, whilst providing investors with attractive, stable returns. In total, Funding Circle has now raised more than £250 million in equity funding from some of the world’s largest and most respected investors.
By bringing together industry leading risk management and cutting edge technology, creditworthy businesses typically access the capital they need in days rather than months. Research found that 94% of borrowers would come back to Funding Circle first in future, ahead of a bank.*
For more information please contact:
Funding Circle UK
email@example.com / +44 (0) 203 667 2245
Notes to editor
*‘Small Business, Big Impact’ research commissioned by Funding Circle from the Centre for
Economics and Business Research, August 2016.
About Funding Circle
Funding Circle (www.fundingcircle.com) is the world’s leading lending platform for business loans, matching small businesses who want to borrow with investors who want to lend in the UK, US and Europe. Since launching in 2010, investors at Funding Circle – including 60,000 individuals, financial institutions, the listed Funding Circle SME Income Fund and Government – have lent more than £2.5 billion ($3 billion) to 25,000 businesses globally. Approximately 10% of investor money now comes from Government sources, including the British Business Bank, European Investment Bank, KfW, the German government-owned development bank, and local councils across the UK.Funding Circle was the first lending platform to announce a formal referral partnership with Santander, one of the UK’s leading high street banks, and has since announced a similar partnership with RBS. It has raised £300m in equity capital from the same investors that backed Facebook, Twitter and Airbnb.
Accel is a leading early- and growth-stage venture capital firm, powering a global community of entrepreneurs. Accel backs entrepreneurs who have what it takes to build a world-class, category-defining business. Founded in 1983, Accel brings more than three decades of experience building and supporting hundreds of companies. Accel’s vision for entrepreneurship and business enables it to identify and invest in the companies that will be responsible for the growth of next-generation industries. Accel has backed a number of iconic global platforms, which are powering new experiences for mobile consumers and the modern enterprise, including Atlassian, Avito, BlaBlaCar, Deliveroo, Dropbox, Etsy, Facebook, Flipkart, Funding Circle, Kayak, QlikTech, Simplivity, Slack, Spotify, Supercell, WorldRemit and others.