Judo Bank just became Australia's newest unicorn. Co-founder David Hornery says it got there by lending to those 'long ignored by the major banks'

Judo Bank founders Joseph Healy and David Hornery have plenty to smile about. (Cole Bennetts)
  • Australian digital business lender Judo Bank has just surpassed a $1 billion valuation, elevating the startup to unicorn status.
  • The challenger bank raised $230 million in fresh capital during a third funding round.
  • Co-founder David Hornery told Business Insider Australia part of Judo’s more recent success reflected the need for banks to form “real relationships” with customers now more than ever.
  • Visit Business Insider Australia’s homepage for more stories.

Australia’s business sector might be struggling but one of its fastest-growing lenders is still kicking goals.

Judo Bank just became Australia’s latest unicorn — a private startup valued at over $1 billion — after its latest funding round netted the digital business lender $230 million in fresh capital, joining the likes of Canva and SafetyCulture.

“The support we’ve received for our third round, at an increased valuation to our second round capital raise last year, underscores the confidence and commitment our existing investors have in Judo, particularly at a time of extreme volatility in global markets, that has impacted all bank valuations,” co-founder David Hornery said in a statement.

It follows on from a $400 million second round – twice its original target – and another $140 million in its first. Combined, they represented the largest private investment ever hauled in by an Australian startup, Judo says.

Perhaps it’s no wonder. The digital bank last month surpassed $1.4 billion in deposits, with Judo actually better placed than most to help its borrowers navigate uncertain times.

“We’ve got 600 customers and 55 bankers, so each looks after around a dozen clients. It means we can proactively and consistently guide them and talk them through this period,” Hornery told Business Insider ahead of the round’s closure. “It’s at times likes these that relationships, real relationships, with people come to the fore.”

“We’re really seeing the opportunity for really good quality small business that need help getting through this and that’s why our pipeline is only growing,” he said.

It’s why Judo has found so much support, having been able to reinforce its position with a $350 million lending facility from Citibank earlier this year and another $500 million from the federal government last month.

“We now have one of the strongest capitalised tier-1 ratios in the country, and intend on rapidly growing our national footprint, and expanding the products and services we offer to thousands of Australian SMEs, whose needs have long been ignored by the major banks,” Hornery said.

“We’ll be putting that additional liquidity to work where it’s needed most in the coming weeks and months.”

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