The Covid loans, the billionaire … and Starling, the very fast-growing bank
Aboard his 92-foot yacht in the Bahamas in June 2015, the reclusive Austrian-born billionaire Harald McPike was investigating a new moneymaking opportunity.
Decades after reportedly making his first fortune in blackjack, the gambler turned investor had set his sights on the burgeoning UK fintech market and invited the founder of Starling Bank, Anne Boden, aboard.
The three-day introductory meeting on the New Life proved lucrative. McPike promised to invest £48m in Boden’s venture in exchange for nearly two-thirds of the business – far more than the £3m she had hoped to secure. That made it one of the largest ever seed-funding rounds for a London-based startup. McPike would go on to invest at least £133m in the business, holding shares via his offshore family office in the Caribbean tax haven.
The billionaire’s stake has since been reduced to 36%, according to Starling, though the bank did not respond to questions over whether McPike’s position had been diluted in a capital raising, or sold to new investors, who piled money into Starling after its incredible growth during the Covid crisis. That fresh funding, worth about £400m, pushed the bank’s valuation from more than £1bn last spring to £2.5bn earlier this year, pricing McPike’s remaining stake at more than £900m.
The pandemic proved to be Starling’s moment in the sun. One of a breed of new banks that aims to challenge the UK high street banking giants with technology, it sucked up business customers during the crisis, handing out loans backed with state cash. Starling is now expected to report its first annual profit in the coming weeks – a milestone that could result in a lucrative payout for shareholders, including McPike, if Boden follows through on plans to float the
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