KOHO Becomes a Unicorn, Eyes Canadian Banking License
By Varun Mittal
Canadian fintech KOHO achieves unicorn status with a C$130M raise, valuing it at C$1.33B. The company now aims for a federal banking license to challenge the Big Five.
Canadian Fintech KOHO Hits Unicorn Status
Canadian fintech KOHO has officially achieved unicorn status after raising C$130 million in new funding. This Series E investment pushes its valuation to C$1.33 billion, providing crucial initial capital for its bid for a federal banking license.
This strategic move positions KOHO to challenge Canada’s highly concentrated banking sector, where the ‘Big Five’ banks control over 80% of assets.
Key Figures and Services
- Total Funding: KOHO’s latest round brings its total capital raised to C$507 million.
- Investors: New participants include Mubadala, Savano Capital, Shopify CEO Tobi Lütke, and Affirm COO Michael Linford. Existing investors like Portage Ventures, Drive Capital, BDC Capital, HOOPP, and Eldridge also participated.
- Customer Base: Founded in 2014, KOHO now serves more than one million Canadians.
- Transactions: The company has processed C$20 billion in transactions since its inception.
- Offerings: KOHO provides no-fee accounts, a prepaid Mastercard, credit-building tools, overdraft protection, and roundups.
Strategic Ambition in Banking
KOHO’s pursuit of a banking license is a significant step, aiming to expand its capabilities and hold deposits directly. This move seeks to enhance customer experience in a market where a JD Power study indicated a widening satisfaction gap with traditional banks.
CEO Daniel Eberhard emphasized the company’s mission: “We’re focused on earning the trust of Canadians and building a different kind of bank.” KOHO is also a Payments Service Provider member of Payments Canada.