Starling, the UK digital bank, has extended its oversubscribed £272million Series D funding round announced in March 2021, following a £50million investment by Goldman Sachs Growth Equity (“Goldman Sachs”), taking the total raised in the investment round to £322million. Pre-money, Starling was valued at £1.1billion.
Starling now has more than two million current accounts, including 350,000 business accounts. Its deposit base has increased from approximately £1billion just over a year ago, to now more than £6billion.
It is the fastest-growing bank for small and medium-sized enterprises (SMEs) in Europe and now holds a 6% share of the UK’s SME banking market. It is on course to report its first full year in profit by the end of its next financial year-end.
The new funding announced by Starling will support its continued rapid and now profitable growth.
Following the initial Series D funding round, Anne Boden, founder and CEO of Starling Bank, said, “Digital banking has reached a tipping point. Customers now expect a fairer, smarter and more human alternative to the banks of the past and that is what we are giving them at Starling as we continue to grow and add new products and services. Our new investors will bring a wealth of experience as we enter the next stage of growth, while the continued support of our existing backers represents a huge vote of confidence.”
Following the Goldman Sachs investment, Boden went on to say, “Securing the support of another global financial heavyweight demonstrates the strength of demand from investors and represents yet another vote of confidence in Starling. 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.”
James Hayward, managing director at Goldman Sachs, said: “Starling is one of the leading and most innovative digital banks in the UK, with an ambitious technology-first leadership team and addressing a deep market opportunity. We are delighted to be supporting their growth with this investment and believe the company has sustainable long-term earnings potential.”
The transaction remains subject to regulatory approval.