Finom Secures $105M Funding to Support SMB Growth

Finom Secures €92.7 Million Growth Investment

Finom, a digital banking platform headquartered in Amsterdam and focused on serving small- and medium-sized businesses (SMBs), has received a growth investment of €92.7 million, equivalent to approximately $105 million. This funding comes exclusively from General Catalyst’s Customer Value Fund, as reported to TechCrunch.

Funding Allocation and Strategy

According to Kos Stiskin, chairman and co-founder of Finom, the newly acquired capital will be dedicated solely to facilitating growth. It will not be allocated to cover operational costs or fund product development initiatives.

Stiskin characterized this investment round as unconventional, noting that General Catalyst will not acquire any equity in the company. He emphasized that Finom’s existing operations are already generating positive cash flow, allowing all new investments to be directly channeled towards customer acquisition.

Expansion of Services

While fundamentally a banking institution, Finom has broadened its service portfolio this year. In February, the company launched an “autonomous AI accounting agent” designed for entrepreneurs and freelancers throughout Europe.

Further expanding its capabilities, Finom entered the direct lending market in March, incorporating an AI-driven scoring system to assess creditworthiness. This credit offering, currently available in the Netherlands, is slated for expansion across Europe before the end of the year.

Customer Base and Revenue Model

Finom currently serves over 100,000 businesses across key European markets including Germany, France, Spain, the Netherlands, and Italy. The company reports positive unit economics in each of these regions.

The primary revenue stream for Finom is subscription-based. Additionally, the company generates income through transaction fees associated with specific services and provides a competitive cash-back program. The recent introduction of lending services has also created a new revenue source through interest earned on credit lines.

Financial Performance and Competitive Landscape

While specific revenue figures were not disclosed, Stiskin revealed that Finom experienced a doubling of its annual recurring revenue in 2024. The company is also currently operating with EBITDAM (earnings before interest, taxes, depreciation, amortization, and marketing) profitability.

Finom’s main competitor is considered to be Qonto, a Paris-based challenger bank that secured €486 million (~$552 million) in Series D funding in January 2022. However, Stiskin asserts that Finom possesses a “stronger localization strategy and a more comprehensive product suite.”

Team Growth and Funding History

The Finom team currently comprises 505 employees, representing a 31.5% increase compared to the previous year. Alessandro Camilotti, formerly the head of finance and analytics EU at Klarna, joined the company as its CFO last September.

To date, Finom has raised approximately €190 million (roughly $214 million) since its founding in 2020. In February 2024, the company announced a €50 million (~$56 million) Series B equity round co-led by General Catalyst and Northzone.

Valuation and Investor Perspective

Finom has not publicly disclosed its current valuation. PitchBook estimates the company’s post-money valuation at $150.7 million as of November 2021, following a €30 million (~$33.8 million) seed funding round from VCs Target Global, Tal Ventures, and General Catalyst.

Zeynep Yavuz, a partner at General Catalyst, highlighted Finom’s “strong execution” within a largely untapped market. She also emphasized the company’s modular infrastructure, which enables efficient scaling across different geographies while maintaining localized adaptations.

Furthermore, Yavuz noted Finom’s proprietary anti-money laundering and know-your-customer engine as a significant advantage, benefiting both compliance efforts and the overall customer experience.