Just four months after disclosing a multi-million euro investment, Hamburg-based credit scoring company Kreditech has announced it received €5m in debt capital from Kreos Capital.
Founded in 2012, Kreditech will use the fresh funds to fast track its growth. It’s safe to say that the company now has solid financial backing – Kreditech’s last funding round, announced in April, came from the Samwer brothers’ investment arm, Global Founders Capital, along with Blumberg Capital, Point Nine Capital and Heiko Hubertz. The company also received a $4m Series A round in December 2012.
Aiming at emerging markets in particular, Kreditech’s technology collects and analyses up to 8,000 datapoints drawn from individuals’ online activities – including their social media activity, GPS locations and eCommerce purchases – using the information to reveal their credit rating score almost instantly. Kreditech also offers customers micro loans and a B2B “Scoring As A Service” product, which provides its technology to banks and other lenders.
It’s not the only player in the market – Kreditech faces competition from UK-based Wonga, which provides short-term “payday” loans via a similar automatic credit rating process
Kreditech cofounder Sebastian Diemer told Gründerszene that the latest funds will be used to scale the company’s existing markets, as using debt capital to launch in new markets is too risky. The team has an ambitious expansion plan – at the moment, Kreditech offers micro-loans in Poland, Spain, the Czech Republic and Russia. In September, the company will go live in Mexico, with roll-outs in other markets such as Australia in the fourth quarter, plus four new countries over the next months.
Along with interest, debt capital companies like Kreos Capital typically take a small amount of equity in the companies they fund. The growth debt fund has also lent capital to Westwing, Heptagon, Delivery Hero, Get Taxi and Wonga