Digital bank One Zero raising $100 million at $400-$450M valuation
Digital bank One Zero raising $100 million at $400-$450M valuation
This new fundraising round reflects a valuation over $100 million higher than the bank's last round in 2022, which valued the bank at $320 million. The increased valuation is attributed to the bank nearing profitability for the first time, with the goal of achieving initial annual profitability by 2025.
Digital bank One Zero is preparing for another fundraising round. In the coming days, representatives of the digital bank, controlled by Amnon Shashua, will meet with shareholders to raise $100 million.
The valuation for this fundraising will be determined in the coming weeks during meetings with shareholders who are expected to participate. Preliminary estimates suggest that the bank is targeting a valuation between $400 million and $450 million.
This new fundraising round reflects a valuation over $100 million higher than the bank's last round in 2022, which valued the bank at $320 million. The increased valuation is attributed to the bank nearing profitability for the first time, with the goal of achieving initial annual profitability by 2025.
Participants in the fundraising are expected to include existing shareholders, as well as new investors. Current stakeholders with more than a 1% share in the digital bank, alongside Shashua, include the Swiss bank Julius Baer, Cerberus Capital Management, the high-tech investment platform OurCrowd, and the insurance company Hachshara.
To date, the digital bank has raised $240 million from investors, though much of the capital was used for establishment costs. Additionally, the bank must raise more capital to meet the capital adequacy requirements set by the Bank of Israel. In 2022 and 2023, the bank reported losses totaling NIS 620 million.
The upcoming fundraising comes after One Zero had attempted to raise $100 million last year, a round that did not materialize due to the outbreak of the war.
The war also significantly delayed One Zero's international expansion plans. Earlier this year, the bank had announced plans to expand abroad in partnership with Italy's Generali Bank (the third-largest private bank in Italy). However, last month, the bank's management informed employees that plans to establish a digital bank in Italy had been frozen with no timeline for renewal.
This expansion was also expected to prompt a restructuring of the bank and its management. The bank had planned to separate its Israeli operations from the technology company that would develop products for the Italian market. One Zero's CEO, Gal Bar Dea, was slated to manage the bank in Italy and oversee its international expansion, while Eyal Gafni was set to become CEO of One Zero Israel. With the cancellation of these plans, Bar Dea remains the bank’s CEO, and Gafni has been appointed co-CEO.
Additionally, throughout the current year, the bank reduced its workforce, laying off 50 employees out of its 400-person team.
