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Thought Machine founder and CEO, Paul Taylor | Image credit: Thought Machine

London-based Thought Machine, a fintech company that builds cloud-native technology to revolutionise core banking, announced on Wednesday that it has closed $160M (approximately €151.36M) in a Series D round of funding.

The investment has raised the company’s valuation to $2.7B (approximately €2.55B) and marks a 100 per cent increase from its previous round at the end of 2021.

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Investors in this round

The investment was led by Temasek, a global investment company headquartered in Singapore, with participation from Intesa Sanpaolo and Morgan Stanley. Existing investors, including Eurazeo, ING, JPMorgan Chase, Lloyds Banking Group, and SEB, also participated in this round.

Carlo Messina, MD and CEO of Intesa Sanpaolo, says, “We are investing £40M into Thought Machine, a fintech innovator and partner we consider strategic to the industrial upgrade of Intesa Sanpaolo. Their cloud-based technology is fundamental to our transformation from incumbent to digital challenger, improving our core banking technology and providing the foundation for our new digital bank, Isybank.”

Lloyds Banking Group, an early investor in Thought Machine, has extended its licence agreement with the business until 2029. This extension is part of Lloyds Banking Group’s continuing technology modernisation programme.

Capital utilisation

Thought Machine says it will use the funds for its global expansion plans in the Asia Pacific, growing in markets such as Vietnam, Thailand, Indonesia, and the Philippines. The company has recently opened a new office in Sydney to expand its operations in Australia, and is opening a new office in Miami to service Latin America. 

The funds will also be used in investing in its technology – expanding the capabilities of its core banking platform and innovating new product lines. 

‍Paul Taylor, founder and CEO of Thought Machine, says, “This new round of funding bringing Temasek, Morgan Stanley, and Intesa Sanpaolo into the business is our statement of intent: we intend to become the leader in core banking technology and are being deployed by the biggest, successful banks around the world. We will use this new capital to accelerate our expansion plans, serve more clients around the world, and continuously refine the capabilities of our core banking platform and other products.”

Moreover, the company has also strengthened its executive team with the appointments of former Bank of America and Finastra finance leader, Arnaud Attamian, as Chief Financial Officer, and former SAP and Box sales leader, Dana Barisano, as Chief Revenue Officer.

A modern core banking platform in the cloud

Founded in 2014 by Paul Taylor, Thought Machine has built a cloud-native core banking engine, Vault Core, which is used by banks and financial institutions around the world, including Intesa Sanpaolo, Lloyds Banking Group, Standard Chartered, ING, Atom bank, and Curve.

The company says that nearly every bank is stuck on a legacy IT platform, which cripples their ability to innovate and give customers the type of service they deserve. Thought Machine says, “Our mission is to create technology that can run the world’s banks according to the best designs and software practices of the modern age. In doing so, we will properly and permanently rid the world’s banks of the problems generated by poor technology running on legacy infrastructure.”

With Vault Core, banks can run any product they wish. This gives banks the freedom to control and shape their strategy as they see fit. Vault Core can exactly replicate a bank’s existing back book of products, as well as create entirely new ones, including current and savings accounts, loans, and mortgages. It can also launch and run products not typically managed from the core, such as credit cards. 

According to Thought Machine, banks also use the company’s Product Library, which offers a catalogue of more than 200 pre-configured financial products, or built from scratch, products such as ‘buy-now-pay-later’ offerings, a combined debit and credit card, and offset mortgages.

The Vault platform runs on all major cloud infrastructure providers, including Amazon Web Services, Google Cloud Platform, and Microsoft Azure.