OakNorth Holdings closes $440 million hoarding round with the SoftBank Vision Fund

OakNorth Holdings has secured a $440 million investment from the SoftBank Vision Fund and the Clermont Group. OakNorth’s core strength lies in the speed and quality of its SME lending origination and credit capabilities, as well as its ability to monitor its loan portfolio - driven by its big data and machine learning platform, OakNorth Analytical Intelligence. The investment is subject to standard closing conditions and regulatory approval.

This round takes OakNorth Holdings’ total primary and secondary funding to over $1 billion, more than any other fintech in Europe and ranking it as one of the most well-funded fintechs in the world. This financing will be used to launch its lending operations in the US, providing North American lenders with the capability to greatly expand business lending opportunities and accelerate their business lending, while creating efficiencies and improving credit quality.

OakNorth’s services not only help its bank lending partners originate and do the credit analysis on loans, but it also assists with the monitoring of their loan portfolios – strengths that have enabled OakNorth to profitably lend over $3.7 billion to British businesses without a single default or late payment since its launch in September 2015.  In addition to providing billions of dollars of funding to SMEs, OakNorth’s loans have directly helped with the creation of over 9,500 new homes and 11,000 new jobs in the UK[2]. Thanks to this most recent round of financing, OakNorth is now in a position to bring this same positive multiplier effect and capabilities to North American lenders and businesses, with the mission to unlock billions of dollars of funding to America’s fast-growth SMEs and create thousands of jobs and new homes in the process.

SoftBank Investment Advisers’ support will also help open doors to market-leading institutions, with the goal of enabling OakNorth to deploy the OakNorth Analytical Intelligence platform to more banks and lenders around the world. The technology is currently being used by institutions in Asia, North America and Europe - including NIBC Bank in the Netherlands which participated in the $100 million fundraising the group closed in September 2018.

Richard F. Chandler, Chairman of Clermont Group, said, “The Clermont Group is delighted to continue its support of OakNorth which is proving to be an emerging champion in the financial services sector. It is building a strong and resilient business with an innovative business model.”

Commenting on the investment, Rishi Khosla, co-founder of OakNorth Holdings, said, “We are excited to have another strong investor on board. With this finance from SoftBank and follow-on investment from Clermont, we will be able to continue scaling the group’s operations globally. If you’re a lender who wants to get serious about commercial lending to small and medium size growth businesses, we can help you originate and underwrite deals faster and more efficiently, as well as maintain a clearer view of how each business in your portfolio is performing. If you’re a growth business in either the UK or the US, we can help you by providing you with a customised debt finance solution that will enable you to achieve your growth ambitions."

“We have a relentless focus on helping small and medium sizes businesses across the world that are in growth mode access better financing to fund their development. These businesses are the backbone of economies and communities, as evidenced by the thousands of new homes and jobs created from the loans we’ve done so far. OakNorth is delivering a highly differentiated service to a key segment of the market that has historically been underserved by commercial banks”, said Munish Varma, Partner at SoftBank Investment Advisers. “The company has a clear and ambitious vision to scale globally and we are excited to work with them to achieve this goal.”

Since its inception, OakNorth Holdings has secured $1.016 billion ($848 million primary) from several investors, including Clermont Group, Coltrane, EDBI of Singapore, GIC, Indiabulls, NIBC, Toscafund, and SoftBank Vision Fund. The group was founded by Rishi Khosla and Joel Perlman, themselves entrepreneurs who were inspired to launch the business following the challenges they faced in securing debt finance from high street banks for their previous business, Copal Amba (which scaled to c.3,000 employees and was acquired by Moody’s Corporation in 2014).

OakNorth provides fast, flexible and accessible debt finance (from £500k to £45 million) to fast-growth businesses and established property developers / investors.