A Luxembourg startup providing capital for digital entrepreneurs has raised over €350m in Series A, to deploy as capital to online entrepreneurs in Europe and expand its activities. This is the largest sum ever raised by any European revenue-based business.
Founded in Luxembourg in 2019, Bloom Financial Group provides founder-friendly capital for ecommerce, recurring revenue and SaaS-based businesses to grow.
“We saw an opportunity to plug that gap […] rather than trying to raise capital from a bank, we can underwrite their entire business by connecting in real-time to their merchant ecommerce platform, their sales data, their bank account data, and give a real-time offer for capital,” founder and CEO James Hickson told Silicon Luxembourg.
Hickson credits the size of the sum, which was led by Credo Capital Partners and funds managed by Fortress Investment Group, to the “sweat equity” of Bloom’s seed funding round which closed in May 2021.
“We had maybe 1,000 hours of pitching and we got rejected. We had people commit and then they had portfolio issues and had to pull out. We had an investor that committed capital and died,” he recalled, adding: “Covid taught us that you can’t take capital for granted. And you have to deliver a superior product.”
“Our goal is to become one of the top three players in Europe in what we do and part of that is building great products with great pricing, and with a great team.”
James Hickson, founder and CEO of Bloom
Bloom, which is currently operational in Hickson’s native UK, and has a presence in Luxembourg and Romania, examines business’ full year of projected revenue to offer lump sums of up to £10 million. The firm also offers free tools to help clients understand their cash position and benchmark performance to the market and peers.
In 2022, the startup plans to deploy operations into Germany, Spain and Italy in the second half of the year. The majority of the capital raised will be deployed “to help good founders build great businesses”, the entrepreneur said, adding that over the next 18 months he expects Bloom to lend €550m. “We’ve come up with a revolutionary pricing model, which we think is much fairer than any of the existing incumbents. And we have a responsibility to deploy that capital now and put it in the hands of ecommerce merchants and business and digital entrepreneurs that need it,” Hickson said.
Hickson’s phenomenal startup story is a testament to a 15-year career with Morgan Stanley, focusing on technology and finance. Prior to moving to Luxembourg, he lived in the UK, US, Saudi Arabia and Hungary.
“I took a role as a CEO of a Fintech company and ran that for two years. That was a really great experience. And then I decided it was time to build my own company,” he said. Hickson has built an experienced team including Klarna former head of data science Werner Kruger and board members Michael Jackson (Mangrove Capital Partners, former Skype COO) and Christopher Dailey (Credo).
The lender has a number of partnerships in the pipeline with existing incumbents that have access to merchants and more capital announcements are expected this year as well as new partnerships and product launches.
“Our goal is to become one of the top three players in Europe in what we do and part of that is building great products with great pricing, and with a great team. I think right now we’re in a really good place,” Hickson concluded.