Goldman Sachs is investing £50m ($70m, Є58m) in UK digital bank Starling as the minnow looks to accelerate growth.
Starling said the £50m investment from Goldman Sachs’s growth equity arm was an extension of the bank’s oversubscribed £272m Series D funding round announced in March 2021, which valued it at over £1.1bn pre-money. According to Starling, this takes the total raised in the Series D round to £322m.
The investment from Goldman comes amid growing expectations that Starling will imminently mount an IPO in London.
Starling said it would use the funding to support its continued rapid growth trajectory.
“Securing the support of another global financial heavyweight demonstrates the strength of demand from investors and represents yet another vote of confidence in Starling. Goldman Sachs will bring valuable insight as we continue with the expansion of lending in the UK, as well as our European expansion and anticipated M&A,” commented Anne Boden, founder and CEO of Starling Bank.
Starling now boasts over two million current accounts, including 350,000 business accounts, with the deposit base having increased from around £1bn just over a year ago to more than £6bn today.
It claims to be the fastest growing bank for small and medium-sized enterprises (SME) in Europe and has risen to hold a 6% share of the UK’s SME banking market.
“Starling is one of the leading and most innovative digital banks in the UK, with an ambitious technology-first leadership team and addressing a deep market opportunity. We are delighted to be supporting their growth with this investment and believe the company has sustainable long-term earnings potential,” said James Hayward, managing director at Goldman Sachs.