Koho becomes Canada's latest unicorn following C$130M Series E round
What's the deal? Canadian challenger bank Koho Financial has raised C$130M in Series E financing at a post-money valuation of C$1.33B, officially reaching unicorn status. The Vancouver-founded fintech was last valued at C$800M.
The all-equity round brings Koho's total funding to C$507M. New investors include Abu Dhabi sovereign wealth fund Mubadala, Savano Capital, Shopify co-founder and chief executive officer Tobi Lütke, and Affirm chief operating officer Michael Linford. Existing backers PortageDealroom has a profile for this one. Try Dealroom →, BDC Capital, Healthcare of Ontario Pension PlanDealroom has a profile for this one. Try Dealroom →, Drive CapitalDealroom has a profile for this one. Try Dealroom →, and Eldridge also participated.
Koho now has more than 2.5 million users — up from one million in 2023 — and generates roughly C$250M in annual revenue, growing 50% year-over-year. The 250-person company also held a small secondary sale for employees alongside the primary round.
Why now? The round provides the initial capital base Koho needs to become a federally regulated bank. The company is in "the final stages" of obtaining a Schedule 1 banking licence — a process it began five years ago and first disclosed in 2024.
Canada's banking industry is dominated by six large incumbents. A licence would let Koho "innovate at an infrastructure level" and build better deposit and lending products while lowering its cost of capital, according to co-founder and chief executive officer Daniel Eberhard. Former Capital One and Amex Bank of Canada chief compliance officer David Merriby joined Koho in March to lead the effort.
What could go wrong? Obtaining a Canadian banking licence is notoriously slow. Toronto-based fintech Questrade secured one only after a six-year process. Regulatory delays could stall Koho's plans to compete directly with incumbents on infrastructure, not just user experience.
Eberhard acknowledged the road ahead: "There's much more work in front of us than behind us."
The signal: Mubadala Capital's participation places Koho alongside a sovereign wealth fund portfolio that typically targets later-stage, high-conviction bets globally, underscoring how seriously international investors are now taking Canada's challenger banking opportunity. With 2.5 million users and C$250M in revenue, Koho's path to a Schedule 1 licence could reset the competitive dynamics of a market long defined by six dominant incumbents — and provide a template for fintechs elsewhere pursuing full charters over bank partnerships.
Read more: betakit.com
