"Victory Park has been a great partner for us in every sense of the word. They are collaborative, creative and eager to help us find solutions. I would gladly recommend them to any company looking for a strategic capital provider to help grow their business."
– Al Goldstein, CEO
Avant Credit Corporation
January 22, 2015 Press Release
Hamburg, Germany, Jan. 22, 2015 – The Kreditech Group, a leading consumer finance technology group, announced today the completion of a $200 million credit facility from Victory Park Capital, an asset management firm focused on middle market debt and equity investments based in the United States. The investment reflects investors’ confidence in its big data credit-scoring technology and its data platform to serve the estimated 4.0 billion unbanked and underbanked individuals worldwide.
The funding strengthens Kreditech’s position as a leader in the consumer finance technology market. It will use the new financing to continue its rapid growth at 60 to 80 percent per quarter. With a focus on the geographic rollout and expansion of its product portfolio, Kreditech expects the financing to deliver scale, lower cost and provide flexibility. The Group’s unique technology uses big data gathered from 15,000 data points to feed its proprietary, self-learning, credit-scoring algorithm.
“We look forward to helping support the company’s future growth and success in the consumer finance technology space,” said Gordon Watson, principal at Victory Park Capital. “Kreditech’s credit-scoring model is impressive and has the ability to identify target customers in any market, even underbanked customers in emerging markets.”
“This record transaction is our next step toward becoming the market-leading digital consumer lender. It helps us address the growing demand for loans of longer durations at fair prices,” said Rene Griemans, chief financial officer of Kreditech. “Setting the stage for our upcoming Series C financing round, the credit facility will reaccelerate our growth well beyond the 500 percent per year mark.”
Since its launch in February 2012, Kreditech’s innovative technology has served two million consumers in eight countries. It is one of the fastest-growing companies in consumer finance technology in Europe with a lending run rate of $130 million. In June 2014, the Group closed a $40 million equity investment by Värde Partners at a $190 million valuation.
The Kreditech Group uses big data and complex machine-learning algorithms to serve a simple mission: "Building a ‘digital bank’ for the unscored worldwide." The Kreditech Group is split into two parts: “Kredi” stands for the subsidiaries operating as financial service providers that issue credit to private individuals. The second part, “tech” is the Hamburg-based tech company – Kreditech Holding – developing banking technology and providing supporting services. Based on 15,000 data points its proprietary technology allows it financial service providers to acquire, identify, score, pay out and upsell customers within seconds. Automated processes combined with self-learning algorithms ensure fast and convenient customer service while minimizing costs and space for human error. The Kreditech Group’s subsidiaries operate in eight countries. Deploying the technology, they offer products from risk based loans and microloans developing to more complex financial services to consumers such as prepaid credit cards. Founded in 2012 by Sebastian Diemer (CEO) and Alexander Graubner-Müller (CTO) Kreditech Group has a revenue run rate of $35 million and a team of 200 passionate employees from 40 nations working on the algo-banking of the future.
Victory Park Capital is a privately held registered investment advisor dedicated to alternative investing through the management of private investment funds. As specialists in credit and private equity investments, VPC focuses on middle market companies across a diversified range of industries. Whether as a lender or a control investor, VPC seeks to identify opportunities where it believes the potential for reward outweighs the risks entailed. Founded in 2007, VPC is headquartered in Chicago with additional resources in Boston, London, Los Angeles, New York and San Francisco. For further information, visit: www.victoryparkcapital.com.