Zopa, a leading digital bank based in the UK and backed by SoftBank, has made strategic additions to its executive team in preparation for its future growth and eventual public listing. The company has appointed Peter Donlon, the former Chief Technology Officer of Moonpig, an online card retailer, as its CTO. Additionally, Kate Erb, a highly experienced chartered accountant from KPMG with over two decades of expertise in financial services, has been brought in as the Chief Operating Officer.
Donlon’s successful experience in guiding Moonpig through its initial public offering in 2021, where the company achieved a valuation of approximately £1.2 billion, makes him an ideal choice to strengthen Zopa’s technological capabilities. Although Moonpig’s stock price has experienced a decline, trading at £151 per share with a market capitalization of £518 million, Donlon’s expertise in navigating the IPO process is valuable for Zopa’s aspirations.
Zopa’s decision to hire experienced professionals like Donlon and Erb reflects the company’s commitment to maturing its operations and driving user growth in anticipation of a future IPO. While Zopa had originally planned to go public last year, the turbulent stock market conditions, characterized by rising interest rates and the subsequent decline of high-growth tech stocks, led the company to postpone its ambitions.
According to CEO Jaidev Janardana, Zopa is not currently considering an IPO in the immediate future. However, he hinted that the company might reconsider its stance if there were positive shifts in market sentiment. Janardana emphasized the need for improved conditions in the public markets, stating that successful IPOs and increased liquidity are essential prerequisites for Zopa’s public listing.
Despite the postponement of its IPO plans, Zopa continues to make significant strides in its customer base, aiming to reach 1 million customers soon and targeting 5 million users in the coming years. The company faces competition from both traditional banks and fintech challengers such as Monzo, Revolut, and Starling.
Janardana highlighted potential growth opportunities for Zopa, including exploring mergers and acquisitions and expanding into other financial sectors, such as small business loans and open banking. Open banking allows the secure sharing of data between banks and third-party providers, enabling Zopa to provide more comprehensive customer experiences. The company raised £75 million ($95.9 million) from investors earlier this year, indicating strong investor confidence in its future prospects.
While Zopa has its sights set on profitability, having achieved monthly profitability in April 2022, Janardana aims to attain full-year profitability by the end of 2023. However, he expressed reservations about venturing into cryptocurrency, citing its complexity and lack of understanding among retail consumers as deterrents to offering crypto-related products. Zopa’s focus remains on delivering reliable and accessible financial solutions to its customers.
As Zopa continues to fortify its leadership team, it demonstrates its commitment to sustained growth and establishing itself as a prominent player in the digital banking landscape. With the support of seasoned executives and potential expansion into new areas of finance, Zopa is positioning itself for long-term success while closely monitoring market conditions to determine the optimal timing for its eventual public listing.