Rishi Khosla, CEO and co-founder of OakNorth Bank
Challenger bank OakNorth is looking to significantly increase its loan book after establishing itself as the fastest company in European history to be granted “unicorn” status.
OakNorth Bank, which prides itself on being ‘the bank for entrepreneurs,’ is looking to lend over £1.5bn to UK SMEs next year.
The bank is expecting to break through the £1bn barrier this year and is now anticipating another record year for 2018.
This comes after the bank, which only launched in 2015, became the fastest ever European company to be given “unicorn” status (meaning it is valued at over US$1bn).
OakNorth achieved this after securing a £154m investment from The Clermont Group, Toscafund and Coltrane for a c.16% stake back in October.
This was quickly followed by a £90m investment by the Singaporean sovereign wealth fund, GIC, in November, which in return received just under a 10% stake in the bank.
Speaking about the raise and the year ahead, Rishi Khosla, CEO and co-founder of OakNorth, was incredibly enthusiastic.
He said: “It has been an incredible and extremely humbling two years for OakNorth – we’ve had the chance to work with some of the UK’s most inspiring and ambitious entrepreneurs, and have helped almost 200 businesses achieve their growth ambitions.
“While we have reached a £1bn loan book since our launch, we know that this represents just a fraction of the businesses that need financing support. This funding will enable us to boost our lending by an additional £1.5bn and add thousands more jobs and homes in the UK.”
Helping it achieve this ambitious target is its eagerly anticipated ‘ACORN Machine’ project. The cloud-based fintech platform will bring together financial institutes and investors from across the globe to help secure investment for UK SMEs who may have previously struggled to secure finance from mainstream lenders.
Khosla added: “Rather than building a technology platform and then going to market trying to sell it, we wanted to build the platform and prove the concept in a highly regulated and highly competitive market – the UK – via OakNorth. Through ACORN we will be able to help lenders around the world unlock the underserved and underestimated market for bespoke loans to SMEs.”