Short-term cash-advancer Wonga has raised $22.25m in a second round of funding that has seen the company backed by some of the world’s top VC firms.
The funding was raised by VC companies Accel Partners, Greylock Partners, and Wonga's original backer Balderton Capital.
The company, which was founded by Errol Damelin and Jonty Hurwitz, supplies cash advances of up to £750 for up to 30 days. It has already provided nearly 100,000 flexible cash loans since the site’s full market launch 11 months ago.
Damelin said the investment would help them to realise ambitious growth plans.
“Balderton Capital has backed us from concept and our two new investors show how game-changing the Wonga proposition is,” Damelin said.
“Accel Partners is a global investor that has backed some of the fastest growth companies of the last two decades, such as Facebook.
“Greylock Partners is a thought leader and a long-term investor and they’ve made a significant statement by making a commitment to Wonga. Backing from three such prominent firms underscores our ability to challenge a major market in a very meaningful way.”
Damelin added that Wonga’s risk-profiling technology, which fully automates the lending process and gives applicants a decision instantly, ensures money is lent responsibly and Wonga’s model is sustainable.
He said: “Our ground-breaking technical innovation and focus on amazing our customers with high levels of service has enabled us to become profitable in a very short a space of time.
“Yet we are also building a sustainable business based on making highly selective and responsible lending decisions.”
Sonali De Rycker, partner at Accel, added: “Wonga’s ability to offer credit in real-time while keeping a tight control on customer experience and defaults is truly disruptive.
“We believe the company has the potential to become a category leader in the consumer finance marketplace.”
© Crimson Business Ltd. 2009