Zeta, a provider of banking software for banks and fintech startups, collected 50 million US dollars from a strategic investor with an assessment of 2 billion US dollars.
The new investment of the American health company Optum marks an increase in the evaluation of the startup in Bengaluru compared to the price of 1.15 billion US collected 250 million US dollars in one round under the direction of the Softbank Vision Fund 2.
Zeta was founded in 2015 by Bhavin Turakhia and Ramki Gaddipati and helps the banks to use modern technology and cloud infrastructure to start and manage credit cards, accounts and loans.
“In the banking business, 60% -70% of institutions still work on Mainframes many that were even born some of us ago,” said Turakhia in an interview. He compared it to the gradual shift of the industry to cloud computing, where banks initially managed their own data centers before taking on services such as AWS and Azure.
He expects a similar development in Kernbanken technology, but with higher operations, since it is about replacing what he calls the “heart and soul of the bank” – systems that process and manage payments.
Zeta, who also counts Mastercard among his supporters, says that it serves 25 million accounts via its platform and add contracts to add another 25 million. The flagship customer in India is HDFC Bank, the largest private lender in the country, which also used the technology of the startup to rebuild the platform for digital payments from Payzapp.
The startup also works with Pluxee, a global provider of corporate services, and Sparrow Financial, a credit card issuer based in the USA.
The United States is Zeta’s largest market, followed by India, where it achieves annual sales of more than 50 million US dollars. The startup is in conversations with several large US banks, but Zeta’s executives warned that some of these partnerships can take years to materialize themselves.
According to Zeta, around 400 million US dollars has invested in its platform since the beginning and expected to become profitable by March 2026. The offers include modules for core banks, payment processing, fraud detection and customer loyalty.
“In the next ten years we intend to record 25% of the market share,” said Turakhia. “This has never happened before, because decades ago a large part of the market share was captured in this industry and largely went through acquisitions.”
Turakhia began his first company with his brother Divyank in 1998. On the way, they sold four internet companies for $ 160 million. Zeta is the third startup that Bhavin has founded since then. In August 2021, the WordPress parents company Automattic supported Turakhia’s latest startup, the business email provider Titan, and evaluated it with $ 300 million.
The company has 1,700 employees in the USA, the Middle East and Asia.
Turakhia said the startup did not have to get the capital: “This investment will most likely reflect a confirmation of our trip.”
