Saudi-backed SoftBank fund pumps $390m into banking startup

British banking start-up OakNorth is targeting international expansion after closing a $440 million fundraising round led by Japan’s SoftBank Group Corp. (File/Reuters)
Updated 08 February 2019
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Saudi-backed SoftBank fund pumps $390m into banking startup

  • The specialist business and property lender will use the cash injection to launch in the United States before considering further overseas opportunities
  • The fundraising also represented a vote of confidence in British lending, despite mounting concerns over the potential impact of Brexit on the country’s economy

LONDON: British banking start-up OakNorth is targeting international expansion after closing a $440 million fundraising round led by Japan’s SoftBank Group Corp.
The specialist business and property lender will use the cash injection to launch in the United States before considering further overseas opportunities, Rishi Khosla, the firm’s co-founder and chief executive, told Reuters on Friday.
The fundraising also represented a vote of confidence in British lending, despite mounting concerns over the potential impact of Brexit on the country’s economy, Khosla said.
“Small businesses are the key growth driver in most economies and that’s true in the UK,” he said.
“The fundamentals are absolutely good over a period of time. If you tar a whole segment with the same brush I think that’s incredibly unfair. You’ll always have good businesses and bad businesses.”
SoftBank’s Vision Fund led the round with a $390 million investment, with Clermont Group providing the rest of the cash.
OakNorth, which also provides personal and business savings, has raised more than $1 billion since launching in September 2015 as investors show an appetite for financial technology firms to shake up the banking industry.
The latest investment values the company at around $2.8 billion.
SoftBank’s technology-focused Vision Fund has multi-billion-dollar investments in US companies, including WeWork and Uber.
“SoftBank always has a very large vision for businesses they get involved in and for us we have a relentless focus on small businesses,” Khosla said.
“For us to fulfil that on a global basis having an investor who shares that vision is really important.”
Khosla added that while the firm was now well-funded, there was a possibility it could float within five years.
British media had reported late last year that OakNorth had held talks with SoftBank about a potential investment.
In September, OakNorth had closed a $100 million funding round, which valued it at $2.3 billion at the time.


Huawei in public test as it unveils sanction-hit phone

Updated 19 September 2019

Huawei in public test as it unveils sanction-hit phone

  • Hit by US sanctions, Huawei's Mate 30 will not be allowed to use Google’s Play Store
  • Household-name services like WhatsApp, Instagram and Google Maps will be unavailable.
BERLIN: Chinese tech giant Huawei launches its latest high-end smartphone in Munich on Thursday, the first that could be void of popular Google apps because of US sanctions.
Observers are asking whether a phone without the Silicon Valley software that users have come to depend on can succeed, or whether Huawei will have found a way for buyers to install popular apps despite the constraints.
The company has maintained a veil of secrecy over its plans, set to be dropped at a 1200 GMT press conference revealing the Mate 30 and Mate 30 Pro models.
Huawei, targeted directly by the United States as part of a broader trade conflict with Beijing, was added to a “blacklist” in Washington in May.
Since then, it has been illegal for American firms to do business with the Chinese firm, suspected of espionage by President Donald Trump and his administration.
As a result, the new Mate will run on a freely available version of Android, the world’s most-used phone operating system that is owned by the search engine heavyweight.
While Mate 30 owners will experience little difference in the use of the system, the lack of Google’s Play Store — which provides access to hundreds of thousands of third-party apps and games as well as films, books and music — could hobble them.
Household-name services like WhatsApp, Instagram and Google Maps will be unavailable.
The tech press reports that this yawning gap in functionality has left some sellers reluctant to stock the new phones, fearing a wave of rapid-fire returns from dissatisfied customers.
Huawei president Richard Yu said at Berlin’s IFA electronics fair this month that his engineers found a “very simple” way to install the hottest apps without going via the Play Store.
Huawei could offer its own app store in a preliminary version, setting itself up as a competitor to the dominant Apple and Google offerings, observers speculate.
Over the longer term, the company could build out a similar “ecosystem” of devices, apps and services as the Silicon Valley companies that would bind users more closely to it.
The world’s second-largest smartphone maker after Samsung, Huawei earlier this month presented its proprietary operating system HarmonyOS, a potential replacement for Android.
The Mate 30 will not yet have HarmonyOS installed.
But it could make for a new round in the decades-old “OS wars” between Microsoft’s Windows and Apple’s Mac OS, then Android versus Apple’s iOS.
Meanwhile, Eric Xu, current holder of Huawei’s rotating chief executive chair, has urged Europe to foster an alternative to Google and Apple.
That could provide an opening for Huawei to build up Europe’s market of 500 million well-off consumers as a stronghold against American rivals.
“If Europe had its own ecosystem for smart devices, Huawei would use it... that would resolve the problem of European digital dependency” on the United States, Xu told German business daily Handelsblatt.
He added that his company would be prepared to invest in developing such joint European-Chinese projects.