Edinburgh private equity firm injects £44m into fintech

The investment is in the expanding financial technologies sector
The investment is in the expanding financial technologies sector
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An Edinburgh-based private equity house has invested in a disruptive tech “powerhouse” in what is the UK’s third-largest fintech financing this year so far.

Dunedin’s funding injection of £44 million into Global Processing Services (GPS) will also see it take a “significant” stake in the global payments processor and tech firm that works with digital and challenger banks, fintechs and financial institutions.

The private equity business said the investment coincides with it seeing a lot of transactional activity, and is the third financial services deal it has completed in two years, following its investments in Kingsbridge and Alpha.

GPS describes itself as the market-leader in issuer-processing, with its single, global integrated platform GPS Apex powering and enabling functionality of next-generation fintech payment companies. It has more than 100 clients including Starling Bank, Revolut, Pockit, Volt Bank, Loot, Stocard, Glint, Osper and Curve.

GPS was founded by Tony Kerr and Craig Dewar and is led by Joanne Dewar and MD Suresh Vaghjiani.

It has about 150 employees based in London and Newcastle.

Oliver Bevan, partner at Dunedin, who will sit on the GPS board alongside fellow partner Dougal Bennett, said: “GPS is positively disrupting a multi-billion-pound industry and is well-placed to continue leading the way following the rise of other highly successful fintech companies.

“We are really excited to be investing in GPS, which represents a significant opportunity for Dunedin to utilise its experience in taking UK companies with a technological edge and enabling them to shine on the international stage. We will support the management team and founders to help GPS to become a truly global leader in this niche market.”

Dunedin investment manager Jessica Hardy and assistant director Andrew Davidson supported Bevan and Bennett on the deal. The private equity firm also said it sees major potential for GPS to expand into new global markets and develop its product portfolio.

Vaghjiani said GPS has experienced “exceptional” growth in recent years, adding: “This partnership with Dunedin will see GPS accelerate even further as innovative fintech companies increasingly require global issuing platforms as well as traditional financial institutions looking to compete with new entrants.”

Tony Kerr, co-founder of GPS, described the partnership with Dunedin as a further milestone for the firm. “The investment will give us extra firepower to facilitate continued growth, strengthen our offering and expand our global footprint,” he said.

Dunedin also operates out of London and recently completed three successful exits – Blackrock, Alpha and Kee Safety – generating a total return of £231m for its investors within three months.

It is currently investing its £300 million Fund III.