Fintech Lender iwoca Raises £46m in Debt and Equity

iwoca, one of Europe’s fastest growing SME lenders, has closed a £21m Series C equity financing round led by Prime Ventures, the specialist growth capital firm dedicated to investing in technology. This new round brings iwoca’s total equity funding to £38m.

All series A and B investors participated in the round including Acton Capital Partners, CommerzVentures, Global Founders Capital and Redline Capital.

In parallel iwoca also raised a £25 million secured debt facility via a syndicate led by Shawbrook Bank which increases its available debt facilities to £40 million.

The investment will be used to further develop iwoca’s proprietary technology and data platform, scale its UK and continental European operations and launch new partnerships, further cementing its position as the lender of choice for SMEs across Europe.

Christoph Rieche, co-founder and CEO of iwoca, said: “It’s been an incredible journey over the last five years but we are still at the very beginning. We’ve already been able to support 7,000 small businesses but we aim to finance at least a million customers over next decade. This investment gives us the firepower we need to achieve our mission.

We are very excited to welcome Prime Ventures to our world-class investor group and embark on our next phase of growth. Given that iwoca is both a technology company and a finance provider, we are very fortunate to have an investor base with experience that covers both areas.

Alternative lenders now represent a crucial lever for economic growth as traditional banks struggle to meet the small business funding gap. Having lent over £150 million across 18,000 transactions since launch in 2012, iwoca is one of the fastest growing business credit providers in Europe. iwoca has now supported 7,000 businesses across the UK, Poland, Spain and Germany.

Iwoca’s active markets cover over 50% of EU GDP and are home to 20 million businesses with less than 10 employees. SMEs across Europe are chronically underserved by traditional lenders, with 63% lacking finance from their banks.

 

As part of the investment round Sake Bosch, Managing Partner at Prime Ventures, will be joining the board as a non-executive director. Sake Bosch said: “iwoca has developed a remarkably sophisticated approach to lending. Its technology platform and strong European reach is redefining small business finance. We invest in growing firms with the objective of making leaders out of them. iwoca has tremendous potential to overtake traditional banking models and scale up to become the European market leader.

Frank Seehaus, Managing Partner at Acton, said: “The small business lending environment is undergoing seismic change. iwoca’s advanced technology and its deep understanding of the financial services needs of SMEs have put it on track to become the European leader. Businesses are demanding a simpler and more efficient borrowing experience.

Patrick Meisberger, Managing Director at CommerzVentures, said: “iwoca is fundamentally transforming the lending landscape. It was an easy decision to participate in this round and we will continue to work closely with the management team to find innovative ways to support the ever-growing financing needs of small businesses. We see extraordinary growth ahead.

Alastair Cookson, Partner at Redline Capital, said: “The combination of this new funding round and much increased wholesale debt facilities gives iwoca significant firepower to capitalise on their genuinely differentiated tech platform by aggressively growing market share.”

Michael Katramados, Director at Shawbrook Bank, said: “iwoca is one of the most innovative lenders in the UK and we are excited to see their continued growth and success. They are creating a truly unique platform for SME lending and we are keen to continue working closely with the management team to help them expand their funding capabilities and support more SMEs in the UK and Europe.”

Author: Dylan Jones

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