The News: Thought Machine, the UK-based cloud banking fintech provider of Vault, recently closed its Series D funding round with $160 million in investment, doubling its valuation to $2.7 billion. The new funding comes just months after the company reached unicorn status last November. Read more from the Financial Times here.
Cloud Banking Fintech Company Thought Machine Doubles Valuation in Funding Round
Analyst Take: UK-based cloud banking fintech firm Thought Machine, founded in 2014, doubled its valuation to $2.7 billion through a recent Series D funding round during which it received $160 million in new investment. The round was led by Singaporean investor Temasek, Italian bank Intesa Sanpaolo, and Morgan Stanley, in addition to existing investors including JPMorgan Chase and Lloyds Banking Group. Thought Machine, which achieved unicorn status in a funding round just last November, plans to use the capital to expand its international presence, target business and corporate banking clients, and develop new products.
Provider of the Vault platform for cloud-based banking, Thought Machine counts more than 35 banks globally as current clients. The company offers the ability to scale up servers and processing power as needed by leveraging data centers in the cloud — moving them away from core reliance on on-premises mainframe computers and working to reduce infrastructure costs. Banks’ need to modernize technology for the digital banking age has created a surge in demand for cloud-native solutions like Vault that ease cloud transformation. That of course does not mean that all banks and financial institutions will shift (or should shift) from reliance on the mainframe, but in some instances, that shift will be key to fintech transformation efforts.
Thought Machine Proves There’s Still Room in Cloud Market
I think this is great news. Thought Machine’s rapid expansion and investment draw signals that there’s room in the cloud market for specialist fintech companies in addition to heavy hitters Amazon, Alphabet, and Microsoft. Cloud transformation remains a priority across many industries that require tailored solutions — for financial institutions, those needs include protections surrounding payments, fraud, and money laundering. As their recent funding rounds prove, Thought Machine’s approach has made it a compelling choice for clients and investors looking to support innovation and resiliency.
It’s encouraging to see significant investment directed at specialist cloud-based solution providers in fintech and beyond. The ability to speed effective cloud transformation remains highly prized and highly rewarded, and Thought Machine has clearly developed a solution that inspires the faith of investors and clients including some of the largest and most influential banks in the world. I’ll be keeping an eye out for the results of this investment, particularly as it provides the ability for Thought Machine to develop innovative new product offerings in the cloud space. Along with that, I’ll be looking for Thought Machine to turn its attention to marketing and brand awareness efforts. It’s a crowded marketplace, we need to be hearing and seeing more of them.
Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum Research as a whole.
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Image Credit: Thought Machine
Shelly Kramer is a Principal Analyst and Founding Partner at Futurum Research. A serial entrepreneur with a technology centric focus, she has worked alongside some of the world’s largest brands to embrace disruption and spur innovation, understand and address the realities of the connected customer, and help navigate the process of digital transformation. She brings 20 years' experience as a brand strategist to her work at Futurum, and has deep experience helping global companies with marketing challenges, GTM strategies, messaging development, and driving strategy and digital transformation for B2B brands across multiple verticals. Shelly's coverage areas include Collaboration/CX/SaaS, platforms, ESG, and Cybersecurity, as well as topics and trends related to the Future of Work, the transformation of the workplace and how people and technology are driving that transformation. A transplanted New Yorker, she has learned to love life in the Midwest, and has firsthand experience that some of the most innovative minds and most successful companies in the world also happen to live in “flyover country.”