Zilch makes its first profit and appoints the ex-CEO of Aviva as a board member

British financial technology company Zilch reported its first-ever month of earnings on Tuesday, marking a major milestone for the company in its pursuit of an eventual initial public offering.

In a trading update, Zilch competes with the likes of Klarna and Block in the ‘buy now, pay later’ space said it turned an operating profit in July 2024 and reached profitability within four years of its founding date – faster than other major consumer fintechs that have also managed to break even.

Competitors Starling and Monzo, meanwhile, took more than three and four years respectively to make their first profit. Others have managed to reach profitability faster. In fact, digital banking startup Revolut, for example, broke ground for the first time just two years after launch.

Zilch also said its annual revenue run rate exceeded £100 million ($130 million), doubling the run rate reported last year.

Philip Belamant, CEO and co-founder of Zilch, told CNBC on Tuesday that despite the current high interest rate environment, the company was able to increase profitability by growing its business rather than cutting back as other fintechs have done.

“If you think about the last two and a half, three years, a lot of venture capital-backed companies, especially high-growth fintech companies, have had to cut their way to profitability. And some of them have even made cuts so far. going bankrupt along the way,” Belamant told CNBC’s “Squawk Box Europe.”

“It wasn’t easy. And for Zilch we took a different approach. We looked at this and said: let’s grow to profitability,” Belamant added.

Separately, Zilch announced on Tuesday the appointment of former Aviva CEO Mark Wilson to its board of directors. Wilson, who was appointed non-executive director, said he was “excited” to join the company at a critical time and “help Zilch continue on its path to sustainable success as a category leader.”

Zilch’s CEO Belamant told CNBC in June that he wants to take the company public in the next 12 to 24 months. That same month, the company announced that it had raised $125 million in initial debt financing from Deutsche Bank.

This deal, which gives Zilch the option to draw down up to $315 million in credit from both Deutsche Bank and other banks, is expected to help the company triple its total sales volumes over the next few years, the company said.

Klarna, which Zilch competes with in Britain, is also planning an IPO in the medium term, with CEO Sebastian Siemiatkowski previously telling CNBC that it would not be “impossible” for the company to list as early as this year.