Viola Credit closes $700M fund to provide asset-based lending to fintech startups

Fintech startup and alternative credit asset manager Viola Credit has closed its latest $700 million fund, which provides asset-based lending capital to fintech, proptech and insurtech startups.

If this fintech play reminds you of Silicon Valley Bank, think again. The latter provides corporate lending, also known as venture lending. Instead, Viola provides lending capital to fintech lenders. So, for example, for a company like Affirm, which provides installment plans to consumers, Viola Credit provides the lending capital to provide these receivables. Another example is Market Finance, a tech-enabled SME lender in the U.K., which needs lending capital to finance loans.

As Ido Vigdor, general partner at Viola Credit, says: “There is a disruption happening in financial services. These are tech companies backed by VCs but they also need financial partners due to their capital-intensive businesses in order to do this. We are at the intersection by providing lending capital solutions to these new tech-based financial solutions.”

The fintech sector boomed in 2021, with global fintech funding reaching a record $132 billion.

The massive digital transformation going on right now has given rise to non-bank and alternative lending companies. In 2021, fintech lenders originated more than $120 billion in loans.

Viola Credit, will partner with fintech platforms across the U.S., Western Europe, U.K., Australia and New Zealand.

Competitors to Viola include Victory Park Capital, Atalaya Capital and Pollen Street Capital in the U.K.