French fintech company Qonto has hit a blow by buying its German rival Penta

Qonto, which provides small and medium-sized businesses and the self-employed with a range of financial management services, has dealt a heavy blow. It has just acquired Penta, its German competitor, thus anticipating its first acquisition. Alexander Prout, one of the founders – his father Baudouin, who ran BNP Paribas between 2003 and 2011 – explains the reasons for this acquisition: “Germany is a booming market for Konto as it has been the most growing market for 18 months, with 170% growth in the number of its customers last year, which is A number also expected this year.”

Penta brings him an additional 50,000 customers (+20%). Germany thus becomes Qonto’s second market after France. The number of employees will increase from 700 people in Paris, Berlin, Barcelona and Milan to 900 people.

Qonto, a company valued at more than 4 billion euros, has yet to turn a profit

Launched in July 2017, Qonto joined the very exclusive club of unicorns in early January, as these young tech companies have been valued at more than $1 billion, thanks to a €486 million fundraising that values ​​the company as €4.4 billion.

Then the company continued with its European expansion with investments of 100 million euros in each of the four countries in which it is present: France, Italy, Spain and Germany.

This circumstance was used to finance the acquisition of Penta in cash and Qonto shares, the amount of which was not disclosed.

Qonto still aims to grow its workforce to 2,000 by 2025 and reach 1 million customers by the same date. The deal is expected to close in the coming weeks. Neither company is currently making a profit.

How Qonto neobank became an all-in-one management tool for small and medium businesses

In 2020, the cumulative losses of French online banking players widened

Profitability is not easy to find for players in the sector. Indeed, if the Internet banking sector in France is booming, the number of customers is rising sharply, and the cumulative losses of the 15 major players in Internet banking in France in 2020 have widened.

In total, their net loss amounted to €441 million that year, compared to €376 million in 2019. The net profit per customer logically follows the trend, going from an average level of – €45 in 2019 to – €57 in 2020. .

Net banking income (equivalent to the volume of business in the sector) is advancing and very little compared to overhead costs (staff, IT, etc.)

Account opening bonuses and advertising expenses still weigh on the cost of customer acquisition. ACPR pays special attention to the profitability of companies in this sector. In March, she noted the unprofitable or unprofitable growth model for new payers.

(with AFP)