Self Financial raises $ 50 million to help at-risk consumers build credit and savings at the same time
Self-funded, a fintech company that aims to help consumers create credit and save at the same time, today announced that it has raised $ 50 million in Series E financing.
Altos Ventures led the funding, which also included the participation of Capital Meritech and Conducting companies and brings the Austin-based startup’s total to $ 127 million since its inception in 2015.
The business, like many fintechs these days, aims to make building credit and savings more accessible, regardless of a person’s financial history. It doesn’t require any credit check to get started.
“We have focused on providing high quality, low cost products that make it easier to access consumer credit,” said James Garvey, Founder and CEO of Self.
Today, Self Financial has 200 employees, up from around 80 at the start of this year. The startup, which was originally founded in California but moved to Austin after participating in the Techstars program in the city, plans to recruit more with its new capital.
Garvey declined to reveal specific revenue figures, saying only that Self will make “nine digits” in revenue this year, roughly 2 times over 2020. Self’s active customer base has more than doubled in the past 12 years. last few months to reach around 1 million today. Over time, it has served over 2 million customers.
The flagship product of fintech, he said, is basically secured installment loans, or small dollar loans with a deposit account to which a CD (certificate of deposit) is connected.
After using this product successfully, customers can then access Self Visa credit card.
Image credits: Self-financing
Self’s Credit Builder’s products are issued through its three banking partners. But the company has built its own core technology platform that Garvey says “powers everything behind the scenes.” The company’s products are available through iOS and Android, as well as through a desktop app.
Starting this month, Self will allow people wHo hold H-1B or L 1 work visa or student visa to open Credit Builder accounts, Garvey says decision “opens door for more people who are new to the credit system to participate American”.
“We believe that everyone should have the opportunity to improve their financial future,” he added.
Part of Self’s long-term goals include entering the insurance market, as well as the planned launch of another product designed to help clients access credit.
“Credit score is used for a lot of things, and in many states it’s a big factor in determining the cost of auto insurance,” he said. “We will help our clients gain access to auto insurance as one of the benefits of a higher credit score. “
The company plans to use its new capital to hire around 50 to 100 people over the next 12 months, Garvey said. Recently, she appointed Kathleen Leonik as Chief Compliance Officer. She previously held executive positions at Juniper Bank, Barclaycard and, most recently, Mercury Financial. She has also worked in compliance at First USA, Bank One and Chase.
Altos Ventures CEO Anthony Lee described Self as a trailblazer in an increasingly crowded space. This week, TomoCredit, which has the same goal of helping under-represented consumers build up a credit history, announced that it has raised $ 10 million. And last week, Varo Bank – the first American neobank to obtain a national banking charter – raised $ 510 million in an E series round table at a valuation of $ 2.5 billion.
“James and his team at Self have a clear mission from day one: to create credit and savings for millions of Americans marginalized by the mainstream financial system,” said Lee. “This is a mission that will take decades to complete and we are happy to be here for the journey.”
For Silverton Partners Managing Director Morgan Flager, who has toured Self’s Series AD, Garvey’s passion has been key to his repeated investments in the company.
“When you have a founder with a clear and noble vision to solve such a massive critical problem, it’s hard to say no as an investor, ”he told TechCrunch.
The company was also drawn to Self’s mission to “elevate” consumers at risk.
“A lot of offers that target at-risk consumers are expensive and restrictive,” he said. “Self Financial is unique in that it intends to break this cycle, rather than just profiting from it in a different way.”