UK Cellular-Solely Atom Financial institution Picks Up $128M Led By BBVA, Proprietor Of Easy In The U.S.
All main banks in the present day supply a approach for patrons to financial institution on-line, however this isn’t stopping a rush of startups rising to construct new, cellular and on-line-solely banks from the bottom up. In one of many newest developments, Atom Financial institution, a UK cellular banking startup and app aimed toward hip, youthful shoppers that has but to launch its business service, is as we speak saying that it has closed an £eighty two million ($128 million) spherical of funding.
The spherical is being led by strategic investor BBVA — the Spanish-based mostly banking big that final yr acquired U.S. on-line banking startup Easy for $117 million. BBVA is taking a 29.5% stake in Atom Financial institution for £forty five million ($sixty eight million), understanding to a publish-cash valuation for the startup of $152.5 million (slightly below $230 million).
Different buyers on this spherical embrace earlier backers Woodford and Toscafund, in addition to Marathon and Polar Capital.
The entire raised by Atom up to now is £one hundred thirty five million, and the corporate says that this would be the final cash it raises earlier than launching to the general public in early 2016.
Fin-tech entrepreneurs have seized on the large proliferation of smartphones and broadband connectivity to construct a quantity of on-line and cellular banking startups throughout Europe, the U.S. and elsewhere.
The thought behind these startups is to disrupt the present banking regime by casting off the additional prices of operating brick and mortar operations, and passing on the financial savings to their digital-savvy shoppers. (Creating markets like Brazil, actually, are notably fascinating on this vein, given their excessive proportion of unbanked shoppers who personal and use smartphones.)
Amid a really crowded subject, Atom Financial institution has caught the attention of buyers partly due to its pedigree. Founder and chairman Anthony Thomson was the co-founding father of the UK’s low-value versatile banking outfit Metro Financial institution. And its CEO is Mark Mullen, the previous chief government of first direct, HSBC’s groundbreaking phone/on-line-solely financial institution.
The opposite factor that Atom is banking on (excuse the pun!) to set itself aside is its sq. give attention to 18-34 yr-olds and offering a monetary expertise that meets their expectations of providers in the present day.
In the lead as much as Atom’s invite-solely beta and full business launch, the corporate — which has been described because the “Uber of banking” — has been teasing particulars of its service, promising to ship a brand new type of financial institution to a brand new era of hipster savers and spenders.
The app — which would be the main means that clients work together with Atom — has been designed by a workforce of engineers who come from the gaming business. And the thought will probably be to make use of newer improvements in areas like push messaging, machine studying and anticipatory computing to make Atom’s banking providers simpler to make use of and extra more likely to be engaged with.
“Life might be predictable, so why not your banking?” Atom’s website reads in certainly one of its teaser panels entitled ‘Telepathic’. “The extra we study the way you wish to financial institution, the higher we’ll get at retaining you one step forward. Foxtrot anybody?”
Along with private banking and financial savings, Atom goals to supply different providers akin to enterprise banking, loans and mortgages, and probably some sort of social media discussion board that it describes solely as “shared knowledge” for the second on its website.
BBVA wouldn’t touch upon whether or not it deliberate to take a few of Easy’s know-how or providers to the UK market — or for Easy to probably increase its choices based mostly on what Atom has constructed, however it looks like an apparent method for BBVA to utilise its Atom funding. Extra usually, the financial institution has a separate $one hundred million BBVA Ventures fund that it invests market-by-market.
For Atom, the BBVA connection might assist it with advertising in addition to assist with greater technical challenges and operational recommendation down the road. And as a financial institution with no giant retail presence within the UK, BBVA has no aggressive battle with its Atom funding.
“We’ve got lengthy admired BBVA’s imaginative and prescient and management,” Mullen stated in a press release. “Like us, BBVA firmly consider [sic] within the energy of know-how to rework buyer’s lives for the higher. We share their dedication to put the pursuits of consumers on the coronary heart of all the things that the financial institution does, and the shared values and relationship between us that has constructed up over months of interplay have been essential to figuring out that they’re THE strategic associate for Atom. It’s a large vote of confidence in our workforce, enterprise mannequin and certainly the way forward for competitors in UK banking that BBVA are approaching this journey with us.”