ClearBank raises £175 million for global expansion

U.K.-based embedded finance startup ClearBank announced it raised £175 million from private equity firm Apax Partners — funds it says will be used for global expansion.

Why it matters: While crypto is getting all the attention for completely reimagining how money moves, ClearBank's funding shows investors still see opportunity in startups that operate within the traditional financial system.

What it does: ClearBank offers banking and payments infrastructure to startups and fintechs via API, enabling them to quickly spin up services for their end users.

• Founded in 2017, the company became the first new clearing bank in the U.K. in over 250 years, putting it up against firms like Barclays, Lloyds, HSBC, and NatWest.
• ClearBank has signed up more than 200 financial institutions and fintechs — including crypto giants like Coinbase and Gemini — with more than 13 million accounts and £3 billion in balances.

What's next: ClearBank says it plans to use the funds for global expansion, offering clearing and embedded banking services in Europe before moving into the North American and Asia Pacific regions.

Yes, but: Global expansion is no small task, especially for a firm that built its business on having a banking license in its home market.

• Offering similar services in a new market is likely to require either acquiring an existing licensed bank or applying for licenses there — both of which are expensive and time-consuming propositions.