Softbank funding round values OakNorth at $2.8bn

Kenny Wastell
11 February 2019

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Softbank has taken part in a $440m funding round for UK-based digital lender Acorn OakNorth, alongside the Clermont Group.

The funding round values the business at around $2.8bn and brings the total amount raised by OakNorth to more than $1bn.

Softbank drew capital for the transaction from its global technology investment vehicle Softbank Vision Fund, which has a $100bn target.

The latest round will finance international expansion for OakNorth, with a particular focus on the North American market.

Closing of the latest funding round is subject to regulatory approval.

Previous funding
OakNorth secured a £66m equity investment from Indian non-bank SME lender Indiabulls in late 2015. It then attracted £160m from Coltrane Asset Management, Clermont Group and Toscafund, valuing the company at more than $1bn, in October 2017. A month later, it received a £90m investment from GIC (an investor in Unquote parent company Acuris).

Most recently, the company raised a $100m round of funding from a consortium of backers including Asian sovereign funds GIC and EBDI in September 2018. Existing backers Clermont, GIC and Coltrane also took part in the round, with NIBC Bank coming on board as new backer.

Company
Established in 2015, OakNorth is a challenger bank that provides debt finance from £500,000 to £40m to fast-growth businesses, as well as property developers and investors. Its UK clients include Leon, Brasserie Blanc and Z Hotels, and property developers Regal London, Galliard and Frogmore.

The business is fully regulated and claims it achieved profitability within a year of launching.

People
Softbank Investment Advisers – Munish Varma (partner).
Clermont Group – Richard F Chandler (chairperson).
Acorn OakNorth – Rishi Khosla (co-founder).

Advisers
Equity – White & Case, Ian Bagshaw, Emmie Jones, Daniel Turgel, Joseph Bradley, Elena Ruggiu, Disha Chandrachud, Lindsey Canning, Nicholas Greenacre, Hyder Jumabhoy, Helen Levendi, Prabhu Narasimhan, Patrick Sarch, Michael Weir, Stuart Willey, Farhad Jalinous, Paul Harrington (legal).