Railsr, the UK-based embedded finance startup, has secured $24 million in its latest fundraising round.
The financial boost comes seven months after the company was saved from collapse by an investor consortium. This rescue resulted in Railsr entering administration under the new name, Embedded Finance, alongside a restructuring of senior management that introduced a new CEO, CFO, and COO.
Founded in 2016 as Railsbank, the firm was among the pioneers in the open API banking and embedded finance sectors, raising over $180 million total and reaching a peak valuation close to $1 billion. However, that valuation dropped to approximately $250 million after a $50 million Series C fundraising round completed in October 2022. Additionally, the company had its license revoked in Lithuania in June 2023 and now aims to obtain an electronic money institution license in France.
The recent fundraising round included long-time investors D Squared Capital and Moneta Venture Capital. Dan Adler, managing director of D Squared Capital, expressed strong support for Embedded Finance, stating, “We continue to strongly back Embedded Finance as we believe in the fundamentals of the business.”
New CEO Philippe Morel also welcomed the investment, noting, “With this substantial new investment, secured in a much tougher fundraising environment, we are very well placed to grow sustainably.” He acknowledged the challenging period for the sector, highlighting that many companies expanded too quickly without establishing proper internal controls, leading to a swift contraction in a difficult economic climate.
Railsr’s chairman shared similar sentiments, emphasizing that the new funding demonstrates the company’s resilience and commitment to regaining momentum. He stressed the importance of the company within the fintech ecosystem, remarking that the sector represents one of the UK’s key growth areas and will play a critical role in maintaining the UK’s status as a leading fintech hub.