UK's Revolut rockets to $33 billion valuation after Softbank-backed fundraising

FILE PHOTO: A Revolut logo is seen in this illustration taken January 6, 2020. REUTERS/Dado Ruvic/Illustration

By Lawrence White

LONDON (Reuters) -British-based digital banking app Revolut has raised around $800 million in a new funding round led by Softbank's Vision Fund and Tiger Global Management, valuing the company at around $33 billion.

The fundraising makes Revolut Britain's most valuable fintech firm and on paper it is now worth slightly more than the market capitalisation of mainstream lender NatWest.

London-based Revolut was worth just $5.5 billion when it raised $500 million in early 2020, and had been eyeing a valuation of around $20 billion as recently as June, according to media reports at the time.

Such stellar valuations are increasingly common in the financial technology sector, with payments company Wise valued at $11 billion last week in London's biggest ever tech listing.

Founded in 2015 by former Credit Suisse trader Nik Storonsky and developer Vladyslav Yatsenko, Revolut has won more than 16 million customers with products including foreign exchange, stock trading and cryptocurrencies, undercutting mainstream banks' prices.

It has yet to translate that rapid growth into profitability, however, with its annual losses doubling last financial year on investment in risk controls.

Revolut has in recent years accelerated its global expansion, pushing into markets including the United States, Australia and Japan.

The fresh cash will mainly be used to help product development, and marketing in countries that Revolut is expanding into, particularly the U.S. and India, Chief Financial Officer Mikko Salovaara told reporters.

The fundraising would not affect the timetable for any potential listing of Revolut, he said.

"We think eventually we will be a public company but have no immediate plans to list," he said.

The investment round was endorsed by Britain's finance minister Rishi Sunak, who wants to grow the country's fintech industry to help keep the financial sector competitive following the UK's departure from the European Union.

"We want to see even more great British Fintech success stories like Revolut," he said.

(Reporting by Lawrence WhiteEditing by Rachel Armstrong and Kirsten Donovan)

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