UK-BASED financial start-up OakNorth last week raised $440 million following investment from SoftBank’s Vision Fund as well as the Clermont Group.
The cash will be used to launch its lending operations in the US, OakNorth said.
Rishi Khosla, co-founder of OakNorth Holdings, said: “With this finance from SoftBank and follow-on investment from Clermont, we will be able to continue scaling the group’s operations globally.
“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.”
Since its launch in September 2015 OakNorth said it has lent more than $3.7 billion to British businesses and its loans have also helped create over 9,500 new homes and 11,000 new jobs in the UK.
Among the businesses that have benefited from OakNorth are Leon, the upmarket fast food outlet; the Tamarind Collection, a fine dining Indian restaurant chain; SGS Hotels Group, an Indian hotels and property group which wanted to extend its footprint in the UK with the addition of the Best Western Calcot in Reading; and Beaumont Capital, an investment firm which backs digital and online companies at a very early stage with seed funding.
The latest investment takes OakNorth Holdings’ total primary and secondary funding to over $1 billion, the company said in a release.
In an interview with the Asian Rich List (published by Eastern Eye) last year, Khosla said: “If you look at the attitude of large companies and this obviously applies to large banks – especially when there is uncertainty and concern in the market – their immediate reaction is to pull back from lending.
“As soon as they (UK banks) pull back from lending, that creates such a big opportunity for us. This [market] is ours to build and that is exactly what we are doing.”
The bank also has a strong and growing list of depositors, in the region of 20,000.
OakNorth is the first bank in the UK to have all its digital infrastructure in the cloud.
Munish Varma, partner at SoftBank Investment Advisers, said: “OakNorth is delivering a highly differentiated service to a key segment of the market that has historically been underserved by commercial banks.
“The company has a clear and ambitious vision to scale globally and we are excited to work with them to achieve this goal.”