2021 was a record year for fintech financing.

The list of “unicorns”, ie start-ups with a valuation of more than one billion dollars, grew almost every week in Europe.

The money continues to bubble up in the new year.

The first European fintech to join the ranks of the unicorns in 2022 is the French Qonto, which offers business accounts for small and medium-sized enterprises (SMEs).

Antonia Mannweiler

Editor in business.

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The company has completed an advanced growth financing called Series D financing for € 486 million. The valuation of the company has thus risen to 4.4 billion euros. According to data from CB Insights, Qonto is likely to have become the most valuable start-up in France.

Qonto was able to win the large American private equity fund Tiger Global Management as new investors.

In the past, this has already provided technology companies such as Meta (Facebook), Linkedin or Spotify with capital when they were still in the early phases of development.

Qonto's new donors also include TCV, Alkeon, Eurazeo, KKR, Insight Partners and Exor Seeds.

The existing investors also include the Valar fund from star investor Peter Thiel, who has already invested his money in other fintechs such as N26.

Business accounts for SMEs

More and more fintechs are currently pushing their way into the European market for business accounts for the estimated 40 million small businesses, freelancers and founders. On the one hand, this is due to the fact that many smaller companies with unsteady cash flows are unattractive customers for the banks. Another reason for the growing popularity of fintechs is that they promise cheaper terms and faster service than traditional banks.

Alexandre Prot and Steve Anavi founded Qonto five years ago because they had started another company a few years earlier and were not satisfied with what the banks had to offer. You currently have a model that they both had dreamed of a few years ago, Prot told the FAZ. Since then, Qonto has been able to acquire 220,000 customers. Started in France, the company is now also active in Italy, Spain and Germany.

According to the company, sales in the three countries outside France have quadrupled in the past two years.

In Germany, the number of customers grew by 170 percent last year.

A large part of the money from the latest financing round should also benefit the German market - after all, 100 million euros for the current and the coming year.

That is how much money there used to be for the expansion into three completely new countries, says Prot. There are currently 25 employees working for Qonto in Berlin; in 2023 there will be 100. 

Expansion in view

With the new money, you want to achieve a total of three goals - the first to win a million small and medium-sized companies as customers by 2025, says Prot. To do this, you have to improve the products and offer new services. The right contact person on site is important for this, which is why the company also has offices in Milan, Barcelona and Berlin. The language is a key factor in Europe. Second, they want to expand further. The focus is on the existing markets in 2022, but new countries are to be added from 2023.

Thirdly, they want to attract more talent to the company. They should be offered more career opportunities, says Alexandre Prot. Currently, a total of around 500 employees work for the French start-up, in three years this number is expected to quadruple to 2,000 employees. The aim is to offer employees the opportunity to work at different locations. Similar to an Erasmus program, fintech employees could work in Berlin for a while, then in Barcelona and then in Milan. That helps the team spirit, so Prot. By 2025, 75 percent of all customers should come from outside France.  

Some industry experts see the standardization of their offers as a shortcoming of fintechs, which do not fit into more complex and specialized business models or fast-growing companies.

Prot replies that they are lucky enough to grow faster than most customers.

Five new account models have been introduced since 2017.

So you can serve the entire company spectrum from zero to 250 employees.

In addition, many companies also have multiple accounts - and one is satisfied if one of them is with Qonto.