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The U.K. fintech sector is on a bit of a peal . Allica Bank — a London - based fintech — recently announced it haddoubled its profits in 2024,bringing in £ 29.9 million , while neobank Revolut announced a £ 1 billion profit in 2024 . Companies of this nature keep on to spring out of London , a urban center that has become a fintech global loss leader , not only because of its long financial inheritance but also because it was a innovator of undefended banking . There are now over 185 U.K. fintech startupsvaluedover £ 1 billion , accord to enquiry from HSBC Innovation Banking .
So it ’s with that context thatVolution , a U.K.-based VC investing in fintech , AI , and SaaS startups , has launched a young $ 100 million monetary fund .
launch in partnership with Japanese VC investors , SBI Investment Co. , this will be Volution ’s 2nd dedicated fund keep an eye on its first , which came in at $ 30 million .
Volution said a “ important number ” of Volution ’s existing LPs recommitted to the new investment company .
The firm said it would aim at caller that have already establish revenue flow but that require extra capital .
James Codling , managing partner at Volution , tell TechCrunch that while the U.K. politics is focused on productivity and growth , there ’s a structural funding challenge , with early - stage funding evaporating post - Series A. He said they are out to fund companies with product - market fit and a whole go - to - market strategy .
“ We back companies that are typically anywhere between 5 million in revenue and up to 20 . That ’s a badly needed part in the grocery at the hour , and it ’s become increasingly so given what happen in the correction in the venture market 2021 - 22 . There ’s an awful lot of funds out there that are struggling to raise new cap and trying to treat with issue that they ’ve already got within their portfolio . ”
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Previous companies Volution has back include Signal AI , Flagstone , Cognism , and Zopa Bank . The former store had three going .
In a statement , Tomoyuki Nii , a director at SBI Investment , said : “ The U.K. is a ball-shaped leader in fintech and AI , with world - course of study universities , a strong regulatory surround , and a thriving entrepreneurial ecosystem . These strengths make it an attractive finish for investment . Our cornerstone loyalty to Volution comes at a fourth dimension when Japan and the U.K. politics are strengthening economical ties to drive growth across both markets . ”
Volution is also running an ESG - focused “ Carbon Carry ” enterprise plan to encourage creditworthy and sustainable growth across its portfolio .
Although fintech is doing well , the U.K. engineering sector has faced a downturn , withfunding at Series A dropping by 44%in 2024 equate to the premature twelvemonth , and Series B rebirth rates plummeting byover 50%in the last five years .