Zopa strengthens its executive team by welcoming two professionals with IPO expertise

LONDON — British digital bank Zopa is strengthening its management team with key hires to drive growth and prepare for a future public listing.

The SoftBank-backed company, which offers credit cards, personal loans, and savings accounts, has exclusively informed CNBC of the appointment of Peter Donlon, former CTO of online card retailer Moonpig, as its CTO.

Zopa has also brought on Kate Erb, a qualified chartered accountant with over 20 years of experience in financial services, as its chief operating officer.

Erb previously served as an operations director at Leeds Building Society.

Donlon’s leadership guided Moonpig through a successful 2021 IPO, valuing the company at £1.2 billion at the time. Moonpig currently trades at £151 per share, with a market capitalization of £518 million, reflecting a decline in technology shares.

Zopa’s decision to appoint Donlon signifies its push for maturity and user growth in preparation for a potential IPO. Despite postponing its IPO in the face of unfavorable market conditions, Zopa’s CEO Jaidev Janardana stated that a flotation could be on the horizon by the middle of next year if market sentiment shifts and liquidity improves.

Janardana expressed his desire for successful IPOs, pointing out that valuations for both banks and tech companies in the public markets are currently unfavorable.

In addition, Zopa aims to expand its customer base, targeting 5 million users in the coming years, while exploring possibilities for mergers and acquisitions and venturing into other areas of finance such as small business loans and open banking.

Zopa raised £75 million ($95.9 million) from investors earlier this year and is actively considering leveraging open banking and data-sharing infrastructure to enhance customer experiences.

The company achieved monthly profitability in April 2022 and aims for full-year profitability by the end of 2024. However, Janardana expressed a lack of interest in offering crypto products, citing complexity and a lack of understanding among retail consumers.

Zopa will soon reach 1 million customers and aims to reach a total of 5 million users in the future. The company faces competition from large banks as well as fintechs like Monzo, Revolut, and Starling.

Janardana revealed a potential interest in expanding business growth through mergers and acquisitions and entering new financial sectors, including small and medium-sized enterprise lending.

To achieve its goals, Zopa remains open to utilizing open banking and data-sharing infrastructure to enhance customer experiences.

With a strong focus on profitability, Zopa aims to achieve full-year profitability by the end of 2024. However, the company currently has no plans to offer cryptocurrency products due to the complexity and lack of consumer understanding.