With 25 fintechs and 10 banks onboarded, banking SaaS unicorn Zeta is targeting a revenue of $250-$300 million by 2025 followed by an IPO in 2026, co-founder and CEO Bhavin Turakhia told BusinessLine.
Currently present in Vietnam, the Philippines, Brazil, India, Italy, Spain, UK and the US, Zeta plans to hire and appoint presidents for Europe, UK, Latin America and APAC regions this year. The start-up is expanding its sales and marketing team in North America adding 30-35 people and another 40-50 people across regions this year.
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“Our revenue run rate was around $10 million in 2019. We are looking to grow by 2X in revenue year-on-year. Based on contracts we signed today, will account to $250-300 million revenue in 2025. We are estimating to hit operational profitability in early 2023. And go for an IPO in 2026,” Turakhia said over a Zoom meeting.
‘Full-stack solution’
Zeta differentiates itself to traditional legacy IT companies selling banking software by creating a full-stack solution, Turakhia added.
Zeta’s offerings in the banking space include services like credit card processing, debit card processing, prepaid accounts, loans, core banking solutions, front-end mobile apps, value added services. It has HDFC Bank, Kotak Mahindra Bank, Yes Bank, Axis Bank, and IndusInd Bank as clients in India and has network deals with Visa and Mastercard.
Sudden growth
Founded in 2015, it wasn’t until the pandemic hit in 2020 that the company saw a sudden jump in its client onboarding and a 78 per cent increase in its team size from 450 to 750 at present.
Out of the 25 fintechs and 10 banks it is servicing currently, six banks and 21 fintechs were added in 2020 alone. They added four new regions too.
“The pandemic had accelerated the process of sales as we didn’t have to meet every client in person and meetings would happen over Zoom Calls.It accelerated process of catching up and closing deals faster,” Turakhia said.
Also read: Zeta aims to partner with more banks through the API platform
It is not often that the rather self-sufficient serial entrepreneur Turakhia and his brother Divyank reach out to the market to raise funding. They managed to turn heads after raising $250 million from SoftBank Vision Fund 2 at a valuation of $1.45 billion, a massive surge from a $300 million valuation Zeta earned in 2019 post its first external funding round from Sodexo BRS.
The founders still hold a 70 per cent stake in the start-up.
“We started looking for funding in November last year. By April, we had settled with SoftBank. We were building Zeta as a global scale banking technology company. Getting SoftBank onboard made a lot of sense from a strategy, capital and accelerated growth stand point. We can use their network to make meaningful connections. Also, we signed some really large contracts. Banking landscape is seeing disruption right now and we are at the forefront with a full stack modern banking platform that exist in the market. This caused significant jump in valuation in a short time,” Turakhia added.
Next up, in another two quarters, Zeta will be launching a new credit card offering and a buy-now, pay-later product starting from North America.