ACORN OakNorth closes $100m funding round to support expansion of ACORN

ACORN OakNorth Holdings has closed a $100m funding round to support the global growth of its ACORN machine.

The investment was supplied by new backers EDBI of Singapore, NIBC Bank, and previous investors Clermont Group, GIC, and Coltrane Asset Management. NIBC Bank will become the bank’s first client in the Netherlands.

Launched in 2015 OakNorth is a cloud-based bank which offers flexible access to debt financing from £500,000 to £40m for fast-growth businesses and established property developers and investors.

The bank’s ACORN platform helps collect data about SMEs from around the world on a host of parameters, which is then analysed by machine learning algorithms to decide on credit decisions. Its ACORN division has offices in New York and Singapore and currently has a team of around 100 people, with another 50 expected to be hired across growth and operations, engineering, machine learning and data science.

This investment will be used to drive global growth of its ACORN solution, which is expected to have more than $5bn in assets under services across clients in the US, Europe and Asia. The bank is hoping to expand its lending capacity in the UK.

OakNorth hopes to have a loan book, which is currently at $2.2bn, of around $2.8bn by the end of the year. Since the begging of the year, it has lent more than $1bn of new capital.

Chu Swee Yeok, Chief Executive Officer and President of the EDBI of Singapore, said: “We are excited to partner and help grow ACORN machine in Asia through its regional base in Singapore. By leveraging machine learning, proprietary and third-party data sources, as well as credit analysis competencies, we believe the platform can help address the underserved SME loans segment in the region, improving financial institutions’ cost efficiency and underwriting processes.”

Late last year, OakNorth secured £244m in funding from investors including GIC, The Clermont Group, Toscafund, and Coltrane. The bank raised this equity to support its contribution to UK financing and launching its ACORN solution.

Earlier in the year, OakNorth supplied a £1m loan to payment processing solution NetPay to support the company’s operational needs.

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