Judo Bank is on the hunt for another $400 million

Judo Bank, the nascent fintech for SMEs, is once more on the hunt for cash, hoping to find another $400 million in a round 3 capital raise, just seven months after it set the Australian record for private funding for a startup round, with the same figure. 

The digital bank’s round 2 was initially meant to be $200 million last July, but doubled in response to strong investor demand.

Co-founder and co-CEO, David Hornery, said the bank was looking for another $400 million over the next three months to help fund its ongoing national expansion. 

“The continued support we are seeing from the investment community, including our existing private and institutional shareholders, demonstrates the strength of the ongoing commitment to Judo Bank, and the fundamental belief in our mission to help SMEs access the funding they need, when they need it,” he said. 

In less than a year, Judo Bank has lent more than $1.1 billion to Australian SMEs as well as taking more than $1 billion in deposits. 

Hornery said the fresh round “will add further depth to our provision of funding” to support SMEs. 

Judo’s existing backers include Bain Capital Credit, Tikehau Capital, Myer Family Investments, OPTrust, the Abu Dhabi Capital Group, Ironbridge, and SPF Investment Management. China’s New Hope is also believed to be one of the company’s backers.

The new round will take the total raised to $940 million, with the fintech kicking off with $140 million in 2018.

The fresh cash should push the neobank into unicorn territory on its valuation.

ASX-listed fintech Prospa (ASX: PGL), which lends to small business and when public in June last year with a $110 million IPO that valued the business at $610 million at $3.78 a share, is expected to write around $640 million in SME loans in 2020. But its share price was hammered late last year following a profit downgrade and currently sits just above $2.