Finom focused on SMB

Although funding may be scarce for some, the fastest growing startup companies still have their choice.

The latest beneficiary of this investor’s appetite is Finom, a five -year -old Challenger Bank, aimed at small and medium -sized businesses across Europe. The company, which claims to have doubled its revenue in 2024, has just closed a circle of its own capital of the E 115 million euros (about $ 133 million), TechCrunch has learned. It only comes a few weeks after he has loaded $ 105 million to fund growth from General Catalyst, her maintenance since 2021.

The Finom business model focuses on providing a European SMB with a financial platform that combines banking, invoicing and a growing range of features, including AI accounting. « Because theoretically, entrepreneurs do not need an accountant at all, » said Executive Director Andrei Petrov (on the left left of the photo).

The ambitious goals for the growth of startups reflect this vision. While Petrov says the goal of Finom to have one million business customers by the end of 2026 is motivational and not stained, its new funding makes this a little more protected.

This belief that Finom could serve a fair share of 26 million SMB in Europe is also reflected in its Serie C. The Circle was led by AVP (former Axa Venture Partners) with the participation of the title of new investors (before e.Ventures) through the growth of the title. Existing investors Cogito Capital, General Catalyst and Northzone have also joined the circle.

Despite this inertia, startup may be easier to win customers from inherited banks – its current plan – than from other Fintech.

Even after its series with its total funding to approximately $ 346 million, Finom has far less external capital than Monzo, N26, Revolut or Wise, which all raised more than $ 1 billion. So far, its financing has been more comprehensive with approximately $ 700 million, raised by the closest part of Finom, the French unicorn Qonto -although the comparison is not perfect.

What makes the structure of financing Finom particularly interesting is its unconventional component. Unlike the typical VC, General Catalyst did not take any equity in Finom with its unconventional circle; The capital of its customer value fund (CVF) can only be used for growth, so it plans to recover its money.

Combined with Serie B, this round of unconventional funding would be sufficient for the Dutch company to reach profitability, according to the chairman and co-founder Kos Stickin (in the right to the right). But Finom was also hoping to raise equity by the end of the year and get a « good and nice » new evaluation in the process. What he did not imagine was to make both deals so close to each other.

« A man took more time than expected and one was much faster than expected, » Stiscin told TechCrunch. He declined to reveal the updated assessment, saying that it alone was twice as big as (also the undisclosed) evaluation related to its B. 2024 dollars for 2024.

Time may have worked in favor of Finom. Since the company does not publish its unit of economy – in addition to its consumer base of 125,000 – the fact that General Catalyst looked under the hood, it probably helped to increase interest rates and speed up funding. This vote of trust – and his direct interest in recovering his money – may have been the signal that made investors hurry up and write checks.

Beyond the signaling effects, receiving the customer’s value fund for financing Finom’s marketing efforts without giving up equity, it may seem like a good deal for its CC supporters – which include the common catalyst itself.

However, Series C will also fund more than a risk effort than the acquisition of customers through marketing.

According to Petrov, one of his applications may be strategic, opportunistic acquisitions that would allow him to expand either his client base or a product portfolio. This is a change in the strategy, given that Finom has only acquired one company in 2022 so far when it purchased Kapaga, British cross-border payment service when Finom is considering expanding in the UK

Since then, Finom has shown its focus to some of the largest markets in Europe, where it sees more capabilities than in the United Kingdom, the company believes that these markets have less Challenger banks that compete for SMB and that traditional banks are doing a bad job serving small business.

Like many neo -worshipers, however, he only works with a license for an electronic money institution (EMI) in most of his main markets: the Netherlands, France, Italy and Spain (though not Germany, where he partnered with Solaris, who has a full banking license).

Despite these licensing restrictions, he was able to add lending to the Netherlands, which he sees as a test basis for offering loans-something, which Petrov sees as a compulsory for every Fintech and business clients.

This lending initiative is also in line with Finom’s efforts to expand its product line as horizontally – with deposits and loans – and vertically « starting from a bank account and completing the payment of taxes, reports and everything. » AI also participates, not just the product.

The company also uses AI internally. With a 500 team, he expects to make some business and technology rental, though not so much to scathing his operations. « We add some people, but we are most adding new types of AI agents to work with internally, » Petrov said. « So we hire less than we need, and see a good result in the use of AI and AI agents to automate some of the (our) routine tasks. »

The leadership structure of Finom has also evolved. The division of the obligations between the four Finom co-founders has gone through some changes over the years, with Petrov already the only CEO-Rolya to once shared with Jacob Novikov, who is now an advisor with Oleg Laguta.

The three of them previously created a Russian digital banking module. But this time, Finom’s focus is on Europe and its entrepreneurs, who, according to Stickin, are « the backbone of the European Union economy. »