The well-known financial technology venture of former Barclays CEO Antony Jenkins has raised £132.5 million ($186.6 million) that is from investors in a bid to expand into North America.
Notably, 10X Future Technologies was introduced by Jenkins in 2016 following the ousting from Barclays which is a year earlier. However, the company mentioned that its prime aim is to support the bank’s shift away from legacy systems to cloud-based technology.
For example, in Britain, around 10x is now working with Nationwide on the lender’s digital; banking ambitions, whereas in Australia the startup technologies are now being used by Westpac for permitting buy-now-pay-later Afterpay to offer the savings accounts.
On Wednesday, the company mentioned that it had raised almost the fresh cash in a funding round co-led by the BlackRock and CPP Investment Board that manages Canada’s pension plan. On the other hand, other investors in 10x’s lastest round involving JPMorgan Nationwide, Ping An, and Westpac.
10x will be using the new funding for expanding into new markets like the U.S. and Canada and scale its platform for supporting dozens of bank’s digital transition plans, which the company has mentioned.
Jenkins has prepared several warnings about the growing threat of digital disruption to the banking industry. In 2015, for instance, he forecasted banks could close half their branches and fire half of their workforce in 10 years.
Jenkins now articulates he “underestimated” how quickly lenders would cut back on their brick-and-mortar operations, accumulating that the coronavirus pandemic has faster the decline of in-person retail banking.
“Covid has accelerated across all our lives a big step up in digital adoption,” Jenkins whispered. “I think most people expect that to persist.”
Banks have passed away from thinking of fintech as a “niche activity” used mainly by millennials five or six years ago to the realization that “the future is digital,” Jenkins thought. Britain’s banking sector has become increasingly viable over the last decade, with new entrants like Revolut and Monzo attracting millions of customers.
10x generated revenue of £52.4 million in 2019, up almost fourfold from the £13.5 million it made the previous year. Losses at the start-up narrowed to £2.3 million from £16.2 million.
Jenkins said he was focused on growing the business rather than hitting profitability in the short term, though the company plans on becoming profitable further down the line.
The company’s competitors embrace the likes of Mambu, which raised money at a $2.1 billion valuation in January, and Thought Machine, which was initiated by ex-Google engineer Paul Taylor.