Zeta, a leading provider of cloud-based banking software, has secured a strategic investment of $50 million, valuing the company at $2 billion. This investment represents a 70% increase from Zeta’s previous valuation of $1.15 billion in 2021. The latest funding round was led by American healthcare giant Optum.
Zeta’s mission is to modernize banking technology, enabling banks and fintech startups to launch and manage financial products with ease. The company’s platform empowers banks to leverage cutting-edge technology and cloud infrastructure for the efficient operation of credit cards, checking accounts, and loans.
According to Zeta’s Co-Founder Bhavin Turakhia, the banking industry is undergoing a transformative shift from traditional mainframe systems to cloud computing. He believes that core banking technology will witness a similar evolution, where Zeta aims to replace legacy systems with its advanced solutions.
Zeta currently serves over 25 million accounts, with contracts to add an additional 25 million. Notably, HDFC Bank, India’s largest private lender, is a prominent customer of Zeta’s technology, utilizing it to revamp its digital payments platform, PayZapp.
With a significant presence in the US and India, Zeta generates over $50 million in annual revenue from India alone. While the startup is engaging in discussions with several major US banks, it acknowledges that partnerships in the banking sector often take time to materialize.
Turakhia emphasized Zeta’s ambitious goal of capturing 25% of the banking software market share over the next decade. He believes that this is an unprecedented opportunity, as the majority of market share has historically been acquired through acquisitions.
Since its inception, Zeta has invested approximately $400 million in its platform and expects to achieve profitability by March 2026. The company’s platform offers a comprehensive suite of services, including core banking, payment processing, fraud detection, and customer engagement modules.
Turakhia highlighted that Zeta had no immediate need to raise funds, stating that the $50 million investment represents a reaffirmation of the company’s growth trajectory and mission to revolutionize banking technology.
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