Oct 15 (Reuters) - Consumer finance fintech Upgrade

said on Thursday it raised $165 million in its latest funding

round, nearly four years after its last external financing

during the height of the 2021 fintech boom.

The round valued Upgrade at $7.3 billion pre-money,

according to a source familiar with the matter, a 21.7% premium

to its previous valuation.

"We're probably 12 to 18 months away from an IPO, so we

wanted to give the team members some liquidity before IPO,"

Upgrade CEO Renaud Laplanche told Reuters in an interview.

Fintech startup investment surged in 2021 on low rates and

abundant capital, but cooled in subsequent years as inflation

soared and the Fed hiked interest rates.

A rebound in equities and easing macro concerns have

revived initial public offerings, with fintechs returning to

market after a years-long slump.

Swedish fintech Klarna ( KLAR ) and neobank Chime

have debuted in New York in recent months.

The round was led by investment firm Neuberger, which also

buys loans from Upgrade. Neuberger's Head of Specialty Finance,

Peter Sterling, has joined Upgrade's board of directors.