Zilch CEO Phil Bellamant.
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British fintech company Zilch reported its first-ever month of profits on Tuesday, marking a major milestone for the company as it eyes a potential initial public offering.
In a trading update, Zilch, which competes with the likes of Klarna and roadblock The buy-now, pay-later venture capital firm said it achieved operating profit in July 2024, reaching profitability within four years of its founding — faster than other major consumer fintechs that have also managed to break even.
Meanwhile, rivals Starling and Monzo took more than three and four years to make their first profit, respectively. Others have achieved profitability much faster. For example, digital banking startup Revolut broke even for the first time just two years after launching.
Zilch also said annual revenues exceeded £100 million ($130 million), double the revenues it reported last year.
Despite the current high-interest rate environment, the company has been able to achieve profitability by growing its business rather than shrinking it like other fintechs have done, Philippe Bellamant, CEO and co-founder of Zilch, told CNBC on Tuesday.
“If you think about the last two and a half or three years, a lot of venture capital-backed companies, especially high-growth fintechs, have had to cut spending to get to profitability. And some of these companies actually cut spending and went bankrupt along the way,” Belmant told CNBC’s “Squawk Box Europe.”
“It wasn’t easy,” Belmant added. “For Zilch, we took a different approach. We looked at this and said, ‘Let’s grow our way to profitability.’”
On Tuesday, Zilch announced the appointment of former Aviva CEO Mark Wilson to its board. Wilson, who has been appointed a non-executive director, said he was “excited” to join the company at a critical juncture and “further help Zilch steer its path to sustainable success as a category leader.”
Zilch CEO Belmant told CNBC in June that he wants to list the company on the stock exchange within the next 12 to 24 months. That same month, the company announced it had raised $125 million in initial debt financing from Deutsche Bank.
The deal, which gives Zilch the option to draw up to $315 million in credit from both Deutsche Bank and other banks, is expected to help the company triple its overall sales volume in the next two years, according to the company.
Klarna, which competes with Zilch in the UK, also plans to float on the stock market in the medium term, with CEO Sebastian Siemiatkowski previously telling CNBC it would not be “impossible” for the company to list as soon as this year.
