Zilch: London fintech unicorn hits monthly operating profit ahead of planned listing
Zilch has reported its first month of operating profit four years after launching ahead of a much-anticipated stock market listing.
The London-based payments firm, launched in 2020, said it achieved an operating profit in July and surpassed a revenue run rate of $130m (£100m) in the same month. It did not disclose the size of July’s profit.
The firm added that it almost doubled its revenue in the year to March 2024. It previously reported £30m in revenue for the year ending on 31 March 2023.
Zilch, valued at $2bn (£1.65bn) last October, said the pace at which it had become profitable “places it in the same bracket” as some of Europe’s biggest fintech start-ups, including Revolut, Starling Bank and Monzo.
Profitability has moved higher up the agenda for UK fintechs in recent years, following a broad peak in valuations and a drop-off in investment after 2021.
Atom Bank, Monzo, Clearbank and Zopa have all posted their first annual pretax profits this year, while Starling and Revolut widened their margins.
“This milestone fundamentally changes the game for us,” Zilch’s co-founder and CEO Philip Belamant said on Tuesday. “Profitability is something that a lot of fast-growing businesses are struggling to achieve, and I am hugely proud of the team for reaching this mark, ahead of plan.”
He added: “While many have cut their way to profit, we’ve doubled our revenue year on year, expanded our team, saved our 4m customers over half a billion dollars in fees and interest costs, and generated over $3bn (£2.3bn) in new sales for merchant partners through our ad-subsidised payments network.”
Zilch is one of the UK’s largest buy-now pay-later (BNPL) providers, competing with the likes of Klarna and Clearpay. It offers a card allowing consumers to pay via debit or credit which can be paid off in interest-free instalments over six weeks or two months, rather than a “checkout button” like many other BNPL firms.
The trading update comes as Zilch plots a much-hyped stock market listing. Belamant told Morning Wire in May that the firm planned to float “within next year or around that mark” but had yet to decide on a location.
A London float would be a major boost to the capital’s bourse, which has struggled to attract big-ticket tech listings in recent years.
Zilch has held talks with the Nasdaq, New York Stock Exchange and London Stock Exchange. Belamant is a co-chair of trade body Innovate Finance’s “Unicorn Council”, which in April made a series of policy recommendations for the UK government to make London a more attractive place for fintech IPOs.
On Tuesday, Zilch also announced the appointment of Mark Wilson, former chief executive of insurance giant Aviva, to its board as a non-executive director.
Wilson’s other boardroom positions include a directorship at BlackRock, the world’s biggest money manager.