UK fintech company Revolut is seeking to raise as much as $1.5bn in additional financing as the payments and banking start-up prepares for an ambitious global expansion.
The group has hired US investment bank JPMorgan to raise $500m in new equity from investors and arrange a concurrent $1bn convertible loan, according to a person familiar with the plans. Sky News was first to report the potential deal.
Revolut and JPMorgan declined to comment.
In its five-year existence, London-based Revolut has attracted almost 8m customers, starting with an app-based account and prepaid debit card before expanding into business services and stock trading.
It recently announced a partnership with payments company Visa to open in 24 new countries including Canada, Japan, Singapore and the US, which will take its total footprint to 55 jurisdictions.
Earlier this month chief operating officer Richard Davies said Revolut aimed to raise about $500m before the end of the year to help it “double down on that growth” and was in “early stages of active conversations” with potential investors.
The planned $1bn loan would convert into shares in the event that the company received a US banking licence, Sky News said.
Revolut secured a eurozone licence last year and, if completed, the new debt and equity package will mean it has raised more than $2bn in funding since its launch in 2015.
Despite its rapid growth and popularity with young spenders, the company is yet to make a profit. It recently reported a pre-tax loss of £33m for 2018 — double that of the prior year — even as revenue more than quadrupled to £58m from £13m.
Revolut, which employs about1,300 people, has been on a hiring spree in recent months to bring in more executives with banking experience to help improve its customer service and compliance systems following complaints.
It is also expected soon to unveil City of London veteran Martin Gilbert as its new chairman following the appointment of ex-Goldman Sachs executive Michael Sherwood as a board member.