Thought Machine, the cloud-native core banking technology provider, has announced an additional $42m in funding for its series B round, due to close in early August.
Eurazeo Growth is leading this extension, with British Patient Capital and SEB also coming in as new investors. It brings the funding round’s total value to $125m following $83m secured in March led by Draper Esprit and joined by Lloyds Banking Group, IQ Capital, Backed and Playfair Capital.
Founded in 2014 by former Google engineer Paul Taylor, Thought Machine has built Vault, a modern cloud-native core system for banks constrained by legacy technology.
In recent months, the company has scaled up international hiring, adding 100 employees in the first two quarters of 2020 across three regions. It has also expanded product compatibility to all major cloud providers.
SEB, a customer of Thought Machine, will join the funding round. This follows a period of testing and implementation of Thought Machine’s core banking platform into SEBx – SEB’s strategic initiative focused on exploring new technologies and future customer offerings.
“We have been working with Thought Machine as part of SEBx’s technology exploration for some time now, building financial products and services in completely new ways,” explained Christoffer Malmer, Head of SEBx.
“Thought Machine brings a fresh perspective to a traditional industry and our investment is a natural next step as we deepen and broaden the relationship.”
With this new round of financing, Thought Machine will continue to invest in growing its business internationally – also hiring key roles in APAC, US and Australia, while continuing to develop new products and features, including its upcoming advanced payments solution.
“The prospect of transitioning to cloud-native technology is now at the forefront of every major bank’s roadmap. Plans have been hastened in the wake of regulatory pressure, economic uncertainty and the need to manage cost-income ratios,” said Paul Taylor, CEO and Founder of Thought Machine.
“Banks around the world are undergoing a fundamental digital transformation while moving to the cloud in response to increasing regulatory complexity, more sophisticated customer needs and growing competition from new entrants. Our investment in Thought Machine demonstrates our belief in the technology Paul and the team have been building and the importance of cloud-native technology for the finance industry,” said Zoé Fabian, Managing Director at Eurazeo Growth.
“We have followed Thought Machine’s development closely, and have been particularly impressed with the scale of the team’s ambition,” added Catherine Lewis La Torre, CEO of British Patient Capital. “By focusing on transforming core banking technology, Thought Machine can bring innovation, agility and resilience to banks around the world. We are delighted to be a long-term investor in the business.”