Tandem Bank, a UK challenger bank that is backed by Qatar and the founder of eBay is rapidly increasing its headcount and negotiating with investors about fundraising following a year of “meteoric growth.”
Today, Tandem said that it had moved into a new 16,000 square foot office that is located in London as part of its plans to double its headcount this year to 230 and increase to 300 people by the end of next year.
It comes after what Ricky Knox, the CEO and founder of the company, said was a year of “meteoric” growth. Tandem offers credit cards and savings tools. It started 2018 with “no revenue, and basically no customers” and ended with approximately half a million customers.
In an interview with Yahoo Finance UK, Knox stated: “Last year we hit 500,000 customers when we had an expectation for 150,000.”
He added: “We’ve just done an aggressive push on expanding customer service, right the way across operations actually. But we need more people.”
Tandem was established in 2015. It was one of a wave of the app-only “neobanks” that were founded in the United Kingdom at the time. Others included Starling, Monzo, Revolut, and Atom.
Because of funding setbacks, the first year of full operations of Tandem was only in 2018. Knox contrasted Tandem with Monzo, which was able to attract 150,00 customers in its first year, and Revolut, which signed up approximately 300,000 during its first year.
Knox, who is a serial entrepreneur, stated: “It’s certainly the fastest I’ve ever grown a business.”
He added: “We’re not slowing down the rate at which we’re growing, we’re speeding it up if anything, and we’re looking at adding Europe as well within the course of the year. That’s a lot of extra work to take on so we need the team that’s commensurate with that.”
Knox did not disclose where in Europe Tandem was targeting, however, he said that the firm was in talks with various regulators.
Tandem is planning to go pan-European from its founding, however, Knox said that Brexit was a factor in the timing.
He stated: “In a Brexit world, being a UK-only business is just a bad strategy.”
Currently, Tandem is trying to raise money from its investors and Knox said that Brexit usually comes up in the discussions.
He stated: “Try talking to a US investor, or in fact, any investor, about a UK-only business and the B-word is their main risk factor or reason not to do a deal.”
He said that Brexit was also causing a “squeeze on talent, particularly on the technology side.”
He added: “Historically, we saw people just going home, going sod this I don’t want to make my career in the UK if it doesn’t like people like me.”
Knox continued: “Often that was as much as an emotional thing as much as it was a factual thing.”
He noted: “Now you definitely see that in talent, particularly in certain areas. Areas like for example cloud engineers who have experience with AWS [Amazon Web Services].”
Knox also did not disclose how much Tandem is aiming to raise or how much it might be valued at in the funding round. He said that the negotiations were going “super, super well.”
He stated: “I’ve grown a business from zero to £25m in one year.”
He continued: “That just doesn’t happen. That’s unbelievable growth in one year. So there’s a lot of excitement. And a lot of excitement in the sector.”