London FinTech iwoca hit net profitability in Q4 2022 and has extended its funding line to £170 million.
Founded in 2011, the small business lender has experienced a surge in working capital demand as SMEs need additional financing due to higher costs and slower repayments from their customers.
The total number of customers funded across the UK and Germany – including all products and repeat customers – grew by over 50% in 2022 vs 2021. iwoca funded 15,429 businesses in 2022, an increase of 54% from 2021.
To meet this surging demand, iwoca has increased its funding line from £125m to £170m with long-standing partner Pollen Street Capital. Other funding lines are also being increased with existing lenders.
Last year, iwoca also more than doubled the maximum size of its Flexi-Loan, one of its core lending products, from £200,000 to £500,000 to meet the growing demand from medium-sized businesses.
“Businesses up and down the country are in need of instant working capital to manage the increased pressure on their cash-flow,” said Christoph Rieche, CEO.
“My co-founder [James Dear] and I started iwoca to fill this exact gap and we’re proud that we can step up and support thousands of small businesses every month. Our biggest constraint now is raising the finance fast enough to meet the huge levels of demand we are seeing.”
iwoca is now reaching nearly 3 million businesses across the UK and Germany through its embedded lending technology, which allows businesses to access loans directly through a range of platforms such as accountancy software apps and digital neo-banks.
In addition to its Flexi-Loan, the lender offers an omni-channel B2B payment solution – iwocaPay, and a Revenue Based Loan, which it also launched in cooperation with eBay in 2022, where repayments are a percentage of a business’s monthly sales.
Michael Katramados, partner at Pollen Street, said: “We are thrilled to extend and expand our partnership with iwoca to help provide much-needed access to capital to small businesses across the UK and Germany.
“This new facility builds on our existing relationship with iwoca which began in 2016 and epitomises our commitment to investments that drive positive impact, in this case the ability to support small businesses through a high quality lending partner.”