KOHO announced that it has raised C$130 million, valuing the Canadian financial technology company at C$1.33 billion. The funding represents a major step in the company’s effort to secure a federal banking license in Canada and continue expanding its suite of financial products.
The round attracted a mix of institutional investors and prominent operator-investors. New backers include Mubadala, the Abu Dhabi-based sovereign investor with more than $385 billion in assets under management, and Savano Capital, a Baltimore-based investment firm focused on high-growth companies. Shopify founder and CEO Tobi Lütke and Affirm COO Michael Linford also participated in the financing.
Existing investors Portage Ventures, Drive Capital, BDC Capital, HOOPP, and Eldridge joined the round.
According to the company, the financing provides the initial capital base required for a federally regulated bank. KOHO said it has been working through the regulatory process for several years and that the new capital enables it to take a significant step toward obtaining a banking license, subject to ministerial approval.
Founded in 2014, KOHO has grown to serve more than 2.5 million Canadians and has raised a total of C$507 million to date. The company offers spending and savings accounts, credit-building products, overdraft protection, and recently launched cryptocurrency capabilities.
KOHO said that becoming a federally regulated bank would provide greater product flexibility, lower costs, and stronger consumer protections for customers.
KEY QUOTES:
“This raise reflects the conviction — from our team, our users, and now some of the world’s most credible investors — that Canada’s financial system needs to work better for more people. We’ve spent years earning the trust of Canadians who deserve better from their financial institutions, and this investor group reflects a shared belief that we’re just getting started. We’ve focused on building the infrastructure, the regulatory relationships, and the trust with Canadians to do this right. The investor group we’ve assembled reflects a shared knowledge that the next great Canadian bank needs to be built differently, and that KOHO is the team to build it.”
Daniel Eberhard, CEO and Founder of KOHO
