Jaidev Janardana, CEO of U.K. digital Zopa.
LONDON — British digital bank Zopa is beefing up its management team with a couple of senior hires, as the company looks to fuel growth and prepare its business for an eventual public listing.
The SoftBank-backed company, which offers credit cards, personal loans and savings accounts, told CNBC exclusively it has hired Peter Donlon, the former chief technology officer of online card retailer Moonpig, as its CTO.
The firm has also brought in Kate Erb, a qualified chartered accountant from KPMG with over 20 years of experience in financial services, as its chief operating officer.
Erb was most recently an operations director at Leeds Building Society.
Donlon notably saw Moonpig through its public listing in 2021, which valued the company at around £1.2 billion at the time. Moonpig now trades at a price of £151 per share, which gives it a market capitalization of £518 million, reflecting a broad slump in technology shares.
His appointment reflects a push from Zopa to grow in maturity and ramp up user growth in anticipation of an eventual initial public offering (IPO). Zopa had planned to go public last year, however it put this ambition on ice as the stock market took a turn for the worst with rising interest rates clobbering high-growth tech stocks.
CEO Jaidev Janardana insisted the bank has no plans for an IPO in the immediate term, however he suggested a flotation could be on the horizon by mid-next year were sentiment in the public markets to change.
What will need to change for that to happen, he explained, is for the public markets to open back up.
“We haven’t had great IPOs,” he told CNBC in an interview on the sidelines of London Tech Week this week. “I would love to see some successful IPOs actually coming.”
“If you look at kind of banks, and how they’re valued, or tech companies, both of them, public market valuations are not great.”
“The second thing is … liquidity.” he added. “We need to make sure that there is enough liquidity for a public company to be truly public. Shares should be able to be bought and sold reasonably easily.”
Zopa will soon reach 1 million customers, a spokesman for the company told CNBC. It ultimately wants to hit 5 million users in the coming years. The firm competes with large banks as well as fintechs like Monzo, Revolut and Starling.
Janardana suggested the company could look to ramp up growth of its business through mergers and acquisitions, and a move into other areas of finance including small business loans and open banking, which allows for the sharing of data between banks and third-party firms.
Zopa raised £75 million ($95.9 million) from investors earlier this year.
“We are open,” he said. “Where there is opportunity for us to use open banking, infrastructure, data, to be able to provide holistic experiences to customers is something that has been of interest for us.”
“SME (small and medium-sized enterprises) lending is another thing that is of interest for us.”
Zopa reached profitability on a monthly basis in April 2022. Zopa aims to achieve full-year profitability by the end of 2023.
In terms of the products that Janardana isn’t interested in rolling out, crypto tops the list. The financial executive, who has helmed Zopa since 2014, said that crypto “is not great for the retail consumer today.”
“I’m not a big fan of crypto yet, I’m not convinced,” he said. “It’s a complicated product that people don’t understand, which is why we never offered it.”