Finom Secures €115M as European Fintech Competition Intensifies

Image Credit: Finom

Amid tighter funding conditions for many startups, Amsterdam-based challenger bank Finom has managed to attract strong investor interest, closing a €115 million (about $133 million) Series C equity round. This substantial raise comes just weeks after Finom secured $105 million in growth funding from General Catalyst, bringing its total funding to an estimated $346 million.

Growth-Focused Platform for SMBs

Founded five years ago, Finom focuses on serving the needs of small and medium-sized businesses (SMBs) across Europe. The company delivers a broad financial platform that bundles banking, invoicing, and increasingly, AI-powered accounting solutions. CEO Andrey Petrov envisions a future where entrepreneurs can manage finances without the need for external accountants, leveraging automation and intelligent tools.

Finom has set an ambitious target of reaching one million business customers by the end of 2026. This fresh round of funding will support acceleration toward that milestone, as Finom aims to tap into Europe's vast SMB market, estimated at over 26 million businesses.

Investor Confidence and Funding Structure

The Series C round was led by AVP (formerly AXA Venture Partners) and included participation from new investor Headline and returning backers like General Catalyst, Cogito Capital, and Northzone. Notably, General Catalyst's earlier non-traditional growth funding came via its Customer Value Fund and did not require the company to give up equity—funds are earmarked strictly for growth initiatives.

This innovative funding structure allowed Finom to strengthen its balance sheet and approach profitability, according to chairman and co-founder Kos Stiskin. The unexpected timing of closing both the equity and non-dilutive funding rounds in quick succession proved advantageous for the company, helping it capture investor demand and raise a new, undisclosed valuation—reportedly double that of its previous round.

Strategic Focus: Expansion and Acquisitions

With this new capital, Finom plans to pursue both customer acquisition and strategic, opportunistic acquisitions to extend its reach and diversify its product suite. While the company's core markets include the Netherlands, France, Italy, and Spain—markets where Finom holds an electronic money institution license—it partners with regulated banks in other regions, such as Germany.

Recently, Finom introduced lending services in the Netherlands, using this as a proving ground before expanding credit offerings to other markets. The goal is to provide a full spectrum of services—from business accounts to advanced AI-enabled tools, reporting, and even tax payments.

AI in Operations and Leadership

Finom's adoption of AI isn't just limited to its customer-facing features. The company’s internal operations are also seeing a transformation, with AI agents increasingly taking over routine business and tech tasks. This approach allows Finom to scale efficiently, hiring fewer people while improving operational output. CEO Andrey Petrov notes that these advances support the company’s ambitious targets without a corresponding increase in headcount.

Leadership at Finom includes four co-founders with deep experience in digital banking. Having previously launched Modulbank in Russia, their current focus is exclusively on serving European entrepreneurs, whom they view as critically important to the continent's economic health.

DeepFounder AI Analysis

Why it matters

Finom’s rapid fundraising and growth demonstrate that even in a challenging funding environment, startups addressing real pain points—like SMB financial management—are still highly attractive. Their hybrid approach to capital structure and focus on automation reflect broader shifts in how nimble fintechs are outmaneuvering legacy players across Europe.

Risks & opportunities

One key risk is the heated competition in European fintech, particularly from massively funded incumbents like Monzo, N26, Revolut, and Wise. However, Finom’s focus on niche SMB needs, combined with product breadth and creative funding, could unlock new market segments. Similar to how Brazil’s Nubank disrupted traditional banking, a focused player like Finom could dominate underserved SMBs if they execute well.

Startup idea or application

An actionable startup idea: Build an API-driven platform that offers verticalized, AI-enhanced back-office automation for SMB-focused neobanks and fintechs. This would let challenger banks plug-in payroll, expense management, tax filing, and dynamic credit underwriting tools without building from scratch—accelerating time to market across multiple regions.

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