As a renter in the UK, moving houses means pulling a huge amount of deposit, which can be difficult at times. UK-based, Fronted solves this problem by lending rental deposits to people. Now the British tech startup has raised over £1 million in a debt and equity deal, increasing their total funding amount to £2 million.
Monzo co-founders fueled the investments
The investments came from the co-founders of London’s leading fintech Monzo — Paul Rippon and Gary Dolman — who were also the Co-CEO and CFO at the UK-based challenger bank. Other distinguished investors included Baroness Kingsmill–former Chairperson at Monzo, Ville Vesterinen and Ling Lin.
The new money raised by Fronted will enable them to grow deposit loan business as well as establish strategic partnerships for the renter-focussed lender. Fronted went live on the Yobota platform in February 2021. Founded in 2016, London-based technology firm Yobota has built a fast, flexible, cloud-native core banking platform that allows clients to create and run innovative financial products.
Co-Founder Jamie Campbell said in a statement: “We are delighted to get the backing of over 20 remarkable investors, to grow the business. This investment is the result of a year of huge effort from the whole team. We will use the money to create greater access to Fronted; partnering with platforms that will offer Fronted as a deposit payment option.”
Jamie continued: “A lot of renters don’t move because they don’t have money saved up. The alternatives in the market have shown that there is a market for deposit help, but we believe the insurance model doesn’t protect tenants and is prone to miss-selling. It is also expensive. For customers bridging between deposits and moving multiple times the fees stack up.”
Gary Dolman, previously of Monzo Bank, and now a venture investor at Antler VC, has joined Fronted’s advisory board: “Fronted’s offering is highly differentiated and equally attractive to their customers and to me as an investor. Their focus, business model and prospects are exciting and I am delighted to join Fronted’s advisory board.”
Paul Rippon, previously of Monzo Bank, and now Chairman at GBB, commented: “Home is where the heart is and I know as a landlord and former tenant that deposits can be difficult to pull together. That real problem needs solving and the Fronted team are doing that in a caring way using interesting modern technology. I’m delighted to be an investor and be part of their journey.”
Fronted was founded by Jamie Campbell, Simon Vans-Colina and Anthony Mann, the former employees at Bud, Monzo, and Apple. After delays caused by the pandemic, the company was launched on 16 February, 2021.
Renters can afford deposits
Fronted is aiming to help renters afford deposits when signing new tenancy agreements, with many UK adults lacking savings to front-up potentially thousands of pounds when moving rental property. The startup does this by offering a fixed 12.5% loan to cover the deposit, with renters able to spread the cost across up to 12 months.