Zilch posts first profit and appoints ex-Aviva CEO to board

British financial technology firm Zilch reported its first month of profit on Tuesday, marking a key milestone for the company as it eyes a possible initial public offering.

In a trading update, Zilch, which competes with the likes of Klarna and Block in the buy now, pay later space, said it made an operating profit in July 2024, reaching profitability within four years of inception – faster than other major consumer fintechs that also managed to achieve profitability.

Competitors Starling and Monzo, meanwhile, took more than three and four years respectively to turn a profit. Others were able to reach profitability more quickly. Digital banking startup Revolut, for example, broke even for the first time just two years after launching.

Zilch also said it had topped 100 million pounds ($130 million) in annual revenue, doubling the run rate it reported last year.

Philip Belamant, CEO and co-founder of Zilch, told CNBC on Tuesday that despite the current high interest rate environment, the firm has been able to achieve profitability by growing the business rather than cutting back as they have other fintechs.

“If you think about the last two-and-a-half, three years, a lot of venture capital-backed companies, particularly high-growth fintech businesses, have had to claw their way to profitability. And some of these have actually been reduced so far. explosion along the way,” Belamant told CNBC’s “Squawk Box Europe.”

“It wasn’t easy. And for Zilch, we took a different approach. We looked at it and said let’s grow our way to profitability,” Belamant added.

Separately on Tuesday, Zilch announced the appointment of former Aviva CEO Mark Wilson to its board. Wilson, who has been named a non-executive director, said he was “thrilled” to join the company at a critical time and “continue to help Zilch steer its path to sustainable success as a category leader.”

Zilch CEO Belamant told CNBC in June that he wants to list the business publicly in the next 12 to 24 months. That same month, the company announced that it had raised $125 million in seed debt financing from Deutsche Bank.

The deal, which gives Zilch the option to draw up to $315 million in credit from both Deutsche Bank and other banks, is expected to help the company triple its total sales volumes over the next two years , according to the company.

Klarna, with which Zilch competes in the UK, is also planning an IPO in the medium term, with its CEO Sebastian Siemiatkowski previously telling CNBC that it would not be “impossible” for the firm to list in this year.