Mambu Raises $135M at $2B+ Valuation - SaaS Banking Platform

Financial institutions – encompassing challenger banks, established banks, and all businesses involved in delivering banking services – share a common trend: rather than developing new products, such as credit lines, deposits, or checking accounts, in-house, many are now choosing to utilize third-party technology to facilitate these services. Today, a significant provider of this technology is announcing a substantial funding round to fuel its expansion, highlighting the growth within this sector.

Mambu, a Berlin-based company that defines itself as a Software-as-a-Service (SaaS) banking platform – offering technology to banks and other organizations through APIs to support lending, deposits, and various other banking products – has secured €110 million (approximately $135 million based on current exchange rates) in new funding. This investment values Mambu at €1.7 billion (slightly over $2 billion at today’s rates), as confirmed by the company.

According to CEO and co-founder Eugene Danilkis, the funds will be allocated to broaden its presence in the 50 markets where it currently operates, with a particular emphasis on regions like South America and Asia. (Notably, for those following the discussion regarding the tech landscape, Mambu has established its U.S. offices in Miami, alongside many other technology companies.)

Mambu has experienced a year-over-year growth rate of 100%. It’s worth noting that when Mambu last received funding – €30 million in 2019 – it was already operating in 50 markets, suggesting ongoing investment and expansion efforts are underway.

The funding round was led by TCV, with participation from Tiger Global and Arena Holdings, as well as existing investors Bessemer Venture Partners, Runa Capital, and Acton Capital Partners. TCV, recognized for its significant growth-stage investments (including companies like Netflix, Facebook, and Spotify), is also gaining prominence for supporting leading European fintech and e-commerce businesses, with recent investments in Revolut, Spryker, Mollie, and Relex.

Mambu is targeting a market driven by the increasing opportunities in modern banking and financial services, fueled by the widespread adoption of smartphones and internet access.

The need to visit physical bank branches for transactions or loan applications is largely a thing of the past. Many of those traditional locations no longer exist. Instead, apps, websites, and on-demand services are now available wherever individuals spend their time and money online.

Danilkis explains that Mambu’s platform currently supports around 7,000 distinct banking products. These are primarily categorized into lending, current accounts, and deposit accounts, but the extensive number demonstrates the diverse range of banking services available today. (For instance, credit is accessible through various card types, point-of-sale financing options, and traditional loans.) In addition to its core offerings, Mambu also integrates with third-party financial services like TransferWise and provides essential services such as security features and a business process management platform.

Gartner estimates (as cited by Mambu) place the banking software market at over $100 billion, with double-digit growth. Mambu’s client base reflects the diverse range of companies competing for a share of this market, including challenger banks like N26 and OakNorth, established banks like Santander and ABN Amro, and telecommunications companies like Orange, collectively serving approximately 20 million customers and managing around $12 billion in assets, according to Mambu.

The expanding market has also led to a growing number of competitors for companies like Mambu, including newer companies such as Rapyd and Unit, as well as Thought Machine, which secured significant funding last year, and established players like Temenos and Italy’s Edera. It will be interesting to observe how these newer entrants in the SaaS banking platform space challenge the emerging leaders, as Mambu is nearing its tenth anniversary (founded in 2011), potentially leading to further consolidation.

Considering its customer base, it’s logical for companies outside the traditional financial services sector, such as telecommunications providers or neo-banks, to leverage API-based services to power their banking operations, allowing them to concentrate on developing innovative algorithms and user-friendly interfaces. However, it’s also noteworthy to see large banks utilizing the platform.

“Banks possess the necessary functionality, but launching new initiatives often hinges on speed and cost,” Danilkis stated. “Banks may have existing systems, but many are outdated. Modifying a financial product’s behavior is complex and carries significant risk, as even minor changes can cause issues. These systems are also not designed for API integration, making real-time connectivity with other systems extremely difficult, if not impossible. Consequently, certain solutions become impractical to develop independently.”

John Doran, a partner at TCV, will be joining Mambu’s board as part of this funding round. While some may view Mambu as an established player, its early entry into the market has enabled it to gain market share and attract investors who recognize its long-term potential.

“Mambu was among the first companies to capitalize on the opportunity to migrate banking software to the cloud,” Doran said in a statement. “The team has created a highly adaptable, genuinely cloud-native product within a multi-billion dollar, rapidly expanding market traditionally dominated by large, slow-moving on-premise vendors. We have been monitoring Mambu’s progress for years and are pleased to partner with Eugene and the entire Mambu team as they expand their offerings to customers globally.”

EDIT: A previous version of this article incorrectly stated the amount raised as €100 million. The correct amount is €110 million (the valuation remains accurate).