South West private equity team backs fast-growing fintech

The South West team at private equity firm LDC have led a significant investment in fast-growing credit fintech LendingMetrics.

LendingMetrics, the credit risk technology group, will use the investment to help it scale its presence in the UK’s fast-growing decisioning software and data market.

Founded in 2010, LendingMetrics’ software and data solutions help hundreds of companies to make highly sophisticated automated and risk-based lending decisions. Clients include building societies, online lenders, mortgage companies, credit card providers and commercial lenders.

As well as its Auto Decision Platform (ADP), its cloud-based software suite includes LendingMetrics Exchange (LMX), a proprietary multi-bureau credit referencing product, OpenBankVision (OBV), a bank statement data platform which helps clients to build accurate affordability profiles in real time, and DeeJoop, a proprietary credit data deduplication tool to standardise high velocity multi-bureau credit files.

LDC is backing LendingMetrics’ management team, led by co-founders CEO Neil Williams and Commercial Director David Wylie. LDC’s investment and strategic support will help the business to accelerate new product development within its core financial services sector and expand its network of partners in its consultancy and data services division.

The backing from LDC will also enable LendingMetrics to explore complementary acquisitions and diversify its presence in new vertical industries with similar credit risk challenges, such as the telecoms, utilities and insurance markets.

The transaction was led by LDC investment director Oliver Schofield, investment manager Vera Kuehne and partner and head of South West and Wales Dewi Hughes.

Neil Williams, CEO of LendingMetrics, said: “We’re extremely proud of what we’ve achieved in the last 14 years, the fantastic team we have built and of the great partnership we have fostered with many clients and partners who have been part of our journey so far. With the support of LDC we can invest for further growth, especially in our R&D team. Having firmly established products such as ADP to be truly industry leading and launched innovative and peerless products such as DeeJoop, our aim is to bring an expanding suite and capability of risk solutions and data services to more businesses and sectors, while preserving the agility, independence and focus on client value and service that have made us successful to date.

“LDC’s track record in backing technology businesses speaks for itself, but it was the LDC team’s approach to the investment that made the difference. They’re already providing the kind of strategic input we expected from an experienced investment partner, but they back us as a team to lead the business and pursue our own vision and ambition.”

David Wylie, commercial director of LendingMetrics, said: “I am delighted that we have been able to agree this deal with such a highly regarded investor, committed to growth and expansion of UK home-grown businesses. The whole LendingMetrics team are responsible for the excellent reputation we have built in the decisioning technology sector and, with LDC’s backing, we look forward to leveraging our market-leading position to scale the business and identify new market opportunities and partnerships.”

Schofield added: “Neil, David and the wider LendingMetrics team have built a highly sophisticated and disruptive technology stack that is at the cutting edge of credit risk technology and has made the business a critical, trusted partner to their clients. We’re excited to be backing the team and helping them to scale in what is a fast-growing and rapidly evolving market.”

LendingMetrics was advised by Sequence Advisers (corporate finance) and RWK Goodman (legal).

LDC was advised by FRP Corporate Finance (corporate finance), Womble Bond Dickinson (legal), BDO (financial and tax due diligence), Armstrong (commercial due diligence), Coppett Hill (sales due diligence), Alvarez & Marsal (tech due diligence) and Aon (insurance due diligence).

The transaction is subject to FCA approval.