Growth Street has closed a new funding round, raising an additional £10m. The funding round is led by existing investors Merian Chrysalis, advised by Merian Global Investors and Arts Alliance.
Growth Street aims to transform the traditional business overdraft in the open banking era. Its flagship product, GrowthLine, is a flexible overdraft-style line of credit. Available for sums between £25,000 and £2m it is designed to support small and medium-sized British businesses.
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In particular, the firm will use the funds to build on its unique credit decision systems. This is powered by data integrations with leading accounting software and Open Banking, to improve decision speed and quality.
Moreover, it will deepen the presence of its national sales team. There is a focus on the most underserved SME populations in the Midlands and North of England. In addition, the firm will diversify its debt funding base by adding institutional investors.
Growth Street lending tops £100m
To date, Growth Street has facilitated £100m of borrowing through its platform to British SMEs.
Notably, in 2018 it announced a marketplace partnership with challenger bank Starling. Similarly, Growth Street has agreed a deal with cloud accounting provider Xero.
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By GlobalDataIn January 2019, the firm announced a £7.5m round of funding led by Merian Chrysalis. The summer funding round values Growth Street at £47.5m, up from £27.5m from the winter fundraise.
Growth Street CEO Greg Carter says: “Our mission has always been to provide businesses with the finance options they need to grow. This injection will help accelerate that mission.
“There’s no two ways about it: the banks are failing businesses. They have failed to innovate, failed to integrate and, fundamentally, failed to provide SMEs with sufficient capital to grow. Since the financial crash in 2008, the banks have dialled back their overdraft volumes by over 40%.
In that same time, the number of UK SMEs has risen 30%. The UK has to find a way to plug this gap. I am excited that Growth Street can play a part in that process.”
