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Fintech scene: “For a German bank, we are no longer a takeover target” – the facts about N26

It is a financing round that raises Germany’s fintech scene to a higher level: the banking startup N26 has raised 260 million euros from investors – to a valuation of 2.3 billion euros. This makes it one of the top rated startups in Germany six years after its founding.

But how many customers does startup actually count? And how much sales does it make? Who are the competitors? Gründerszene has collected the most important facts:

N26 offers a free checking account, which mainly works via a smartphone app. The business model: Fintech earns money through fees and commission through a premium account and affiliated partners such as Transferwise. How much revenue the company currently makes is a well-kept secret.
Through a premium account and affiliated partners such as Transferwise Fintech earned by fees and commission money. How much revenue the company currently makes is a well-kept secret. Even the important key figure income per customer, the so-called unit economics, is not public. The competitor Monzo stated recently in the start-up scene conversation, at least no more money per customer to burn. N26 is much more covered: “We could already be profitable today, if we wanted,” said Valentin Stalf in a world interview. But the company is relying instead on expansion.

About the competitors

The competitor Monzo stated recently in the start-up scene conversation, at least no more money per customer to burn. N26 is much more covered: “We could already be profitable today, if we wanted,” said Valentin Stalf in a world interview. But the company is relying instead on expansion. A total of 2.3 million customers counts N26 according to their own information. The question is how many users have their salary transferred to the account – and use it as the main account. An analysis of the industry newsletter Finanz-Szene.de recently came to 25 to 30 percent. That’s realistic: The British competitor Monzo is 30 percent. It is an important number, because it is primarily with these customers that you can make money, because then more chargeable additional offers are perceived.

How many “right” customers does N26 have? One million customers are now registered in the Berlin banking startup. But how many of them really have their first account with N26?

In the coming years, N26 wants to reach 50 to 100 million customers, announced CEO Valentin Stalf. Especially for this strong growth N26 has taken up the venture capital.

Especially for this strong growth N26 has taken up the venture capital. First, the expansion in the US is targeted. “So far, there is no bank like ours there,” says Stalf. N26 wants to become the market leader in mobile banking. The US market launch had been delayed a bit, in the first half of the year it should start now. Over the next two years, another four to six markets will follow. On the roadmap are: Australia, Brazil, Canada and Mexico. N26 wants to stay away from Asia first. The Berlin startup is currently active in 24 European markets.

On the roadmap are:

Australia, Brazil, Canada and Mexico. N26 wants to stay away from Asia first. The Berlin startup is currently active in 24 European markets. An important competitor is the British Fintech Revolut, which was funded by well-known investors Index and Rocket Internet. It was rated in the spring of 2018 with the equivalent of 1.5 billion euros. Recently, we analyzed the user growth of the two rivals:

The value of each customer is currently valued by the investors with 1,000 euros. However, the investment is of course a big bet in the strong growth of N26. With more customers, the cost per user should decrease. “Thanks to our modern systems, a customer costs us just one-sixth of what traditional banks have to spend,” says Stalf in the interview. This value will continue to decline with more customers.

However, the investment is of course a big bet in the strong growth of N26

With more customers, the cost per user should decrease. “Thanks to our modern systems, a customer costs us just one-sixth of what traditional banks have to spend,” says Stalf in the interview. This value will continue to decline with more customers. After the financing, N26 can meanwhile also be compared with other banks: The Fintech is rated higher than the third largest listed bank in Germany: the Wiesbaden real estate bank Aareal. It currently brings it to 1.7 billion euros.

Fintech is rated higher than the third largest listed bank in Germany

The Wiesbaden real estate bank Aareal. It currently brings it to 1.7 billion euros. What’s next? N26 founder Valentin Stalf wants to remain independent for a long time: “At least for a German bank, we are no longer a takeover target at the latest. We are simply too big for that. Apart from that, we have no interest at all in being taken over”. The fintech wants to remain independent, emphasizes the founder.

Also published on Medium.

Published inFintech

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