UK-based banking technology firm 10x Future technologies closed a $187m in Series C financing round co-led by funds managed by BlackRock and Canada Pension Plan Investment Board (CPP Investments).
The round saw participation from existing investors JPMorgan Chase, Nationwide, Ping An and Westpac. The deal gives 10x a valuation of roughly £500m ($704m).
The company will use the funding for its expansion plans into new markets, including North America, as well as further investment into the development of the cloud-native 10x SuperCore platform – an all-in-one system built from scratch to run a wide range of banking services such as payments, core banking, mortgages, analytics, security and marketing, which 10x’s bank customers can integrate into their existing tech by way of APIs, or 10x can use to build those clients new services from the ground up.
Founded by Antony Jenkins in 2016, 10x Future Technologies aims to help banks shift away from legacy systems to cloud-based technology. It provides a cloud-native SaaS bank operating system that enables banks to deliver products, services and customer experiences to retail and SME customers.
The platform supports customisable product behaviours and accounting rules, integrates with banks’ wider technology estates and harmonises with local and regional compliance and regulatory requirements.
10x is working with Nationwide on the lender’s digital banking ambitions, while in Australia the start-up’s technology is being used by Westpac to allow buy-now-pay-later firm Afterpay to offer savings accounts.
10x generated revenue of £52.4m in 2019, up almost fourfold from the £13.5m it made the previous year. As banks continue to digitalise, companies like 10x scaled up and, as a result, losses at the startup narrowed to £2.3m from £16.2m.
Jenkins said he was focused on growing the business rather than hitting profitability in the short term, though the company plans on becoming profitable further down the line. The round “represents another significant milestone in our journey to become the operating system of choice for leading banks across the globe,” he said.
“Our vision is to reliably support more than one billion of their customers within the next 10 years,” Jenkins added.
The company’s competitors include the likes of Mambu, which raised money at a $2.1bn valuation in January, and Thought Machine, which was founded by ex-Google engineer Paul Taylor.
Commenting on the round, BlackRock’s head of Innovation Capital William Abecassis said, “We have been impressed with 10x’s strategy and ambition to play a key role at the heart of transformations taking place in financial services, driven by technology innovation, consumer expectations and regulatory reform.”
Building on the same sentiment, CPP Investments MD and head of Thematic Investing Leon Pedersen added, “10x is very well placed to change how big banks are built and deliver for their customers. 10x presents an attractive opportunity for a long-term investor like CPP Investments as we believe they will benefit from their exposure to the structural growth trend of financial institutions investing in digital initiatives and renewing core technology infrastructure, allowing banks to introduce new offerings and products much faster than using legacy platforms.”
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