Gen-Z Cleo Super App Hits $500M Valuation Despite Tech Slowdown | Economic news

A British financial app aimed at Gen-Z consumers has reached a valuation of $500 million despite the turbulent backdrop that has plagued tech companies since Russia invaded Ukraine three months ago.

Sky News has learned that Cleo, which was founded by Barney Hussey-Yeo in 2016, has raised $80m in new capital from investors including Sofina, a listed tech investor that has backed companies such as Typeform and Graphcore .

The fundraising was orchestrated over a period of months but was only finalized after pressures began to build on the valuations of capital-hungry growth companies.

Cleo was founded by Barney Hussey-Yeo in 2016. Photo: Cleo

Cleo is a digital assistant that offers users proactive financial advice with a distinctive tone of voice that aims to avoid the jargon typical of consumer-facing offerings in the industry.

It has amassed an array of heavyweight backers in previous funding rounds, the last of which took place 18 months ago and raised around $40 million for the company.

Sources close to Cleo said the new capital injection was agreed at a valuation of around $500 million, around five times the level of the December 2020 fundraising.

An insider added that the company’s accelerating growth rates coupled with its low level of cash burn meant it had been able to convince investors to back it at the new valuation.

Cleo now serves millions of young consumers in the US and claims to be the only fintech founded in the UK before launching in the US and then making it its main market.

Raising capital now will allow Cleo to maintain and expand its service during an economic downturn that many economists believe could be prolonged.

It also intends to increase its workforce from 140 full-time equivalents to around 220 by the end of the year.

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The company’s existing backers include blue-chip venture capital names like Balderton Capital and LocalGlobe, with individual investors including founders of tech unicorns like Skype and Wise.

Cleo declined to comment on the fundraising or its new valuation.

A Sofina spokesperson said: “We are delighted to form this partnership with Cleo, a company and application that is truly loved by its users, on whom Cleo has already had a positive impact.

“We look forward to the journey ahead, bringing personal financial empowerment through fintech to many more people around the world.”

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