Starling now has over 2m customers and made a profit last year
Starling, the UK-based digital bank, confirmed on Monday that Goldman Sachs has invested £50m into the company.
Starling said that the Goldman’s investment is part of an already oversubscribed funding round of £272m, which valued the company above £1.1bn.
The bank said it would allocate the funding towards its “continued rapid and now profitable growth”.
Since it was launched in 2017 Starling has earned over 2m customers and even made a profit during the past year, one of the only challengers to the major banks to do so.
Starling performed well despite the pandemic thanks to its efforts in business banking which included its participation in the government’s Covid-19 lending scheme.
The bank now has in excess of £5.4bn in deposits while its gross lending has reached above £2bn.
Starling Bank has already gained attention from Lloyds and JP Morgan. Last autumn it was reported JP Morgan had talked about buying Starling while Lloyds was interested in its technology.
“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,” James Hayward, managing director at Goldman Sachs, said.
“Securing the support of another global financial heavyweight demonstrates the strength of demand from investors and represents yet another vote of confidence in Starling,” founder and chief executive Anne Boden.
“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 the fastest-growing bank for small and medium-sized enterprises 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.