KOHO Raises $130M, Nears Bank Status at $1.33B Valuation
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Key Highlights
Canadian fintech KOHO secures $130M, reaching a $1.33B valuation. Set to become a federally regulated bank, enhancing services for underserved Canadians.
KOHO Raises $130M, Nears Bank Status
Canadian fintech KOHO has secured $130 million in new funding, pushing its valuation to $1.33 billion. This capital propels KOHO closer to becoming a federally regulated Schedule 1 bank, aiming to better serve millions of Canadians.
Key Investment Details
- $130 million raised in the latest funding round.
- Company valuation now stands at $1.33 billion.
- Over 2.5 million Canadians are currently served by KOHO.
- New investors include Mubadala, Savano Capital, Shopify founder Tobi Lütke, and Affirm COO Michael Linford.
- Returning backers include Portage, Drive Capital, BDC, HOOPP, and Eldridge.
Strategic Shift to Full Banking
Becoming a Schedule 1 bank is a strategic move for KOHO. CEO Daniel Eberhard states this status will grant greater control over costs, product design, and consumer protections. It specifically targets underserved segments like newcomers, gig workers, and those with irregular incomes, who often face challenges with traditional banking models.
What’s Next for KOHO
Approval for banking status is anticipated as early as this year, following entry into the second phase of the licensing process in early 2024. KOHO’s product expansion, including credit-building tools and overdraft protection, will continue to be customer-led, reinforced by its new banking accountability.