In the ever-growing fintech industry, marked by rapid digital transformation, Blance emerges as a dynamic player. With the Indian fintech market projected to reach $2.1 trillion by 2030, Blance strategically positions itself to capitalize on this growth.
The company offers goal-centric recurring deposit solutions in India, ensuring 5x better maturity outcomes and providing users with exclusive benefits upon maturity.
In this article, explore more about the journey of Blance, its founders, revenue model, product/service, and more.
Founded in January 2023, Blance is India’s one and only goal-centric recurring deposit marketplace. With the unique solution of combining traditional RDs with the goal-based needs of retail investors, RDs on Blance provide 5x better maturity outcomes than a regular RD. Blance users can save systematically towards a goal in the form of an RD, and unlock brand discounts, credit cards, loans, and insurance options on maturity.
Although the app is currently in the Beta version, it is fully operational. Blance is gearing up for a complete launch in the coming months with a mission to revolutionize the landscape of recurring retail investments in India.
Blance – Industry
In the Fintech industry, Blance targets a market size of over 90 million households earning more than INR 5 lakh yearly and spending USD 50 billion. They aim to capture a 10% market share in three years, particularly in financing high-ticket-size purchases with goal-based Recurring Deposits & other offerings.
Regarding the industry’s future, Blance aims to forge partnerships with NBFCs, Banks, and other deposit-taking entities. Additionally, they are committed to assisting new-to-credit users in initiating their credit journey through secured credit cards and loans This will empower users to build their credit scores, subsequently opening doors to further credit opportunities.
Ashutosh, Neeraj, and Pankaj, co-founders of Blance, are childhood friends who hail from Lucknow, Uttar Pradesh, India, and have studied in the same school.
Ashutosh Prakash Singh
Ashutosh Prakash Singh, Co-founder and CEO, of Blance, pursued a B.Tech degree at AKTU. With over 7 years of experience in Product and growth, he is a 2-time Founder, having contributed to the success of ventures like 6Sense and Slintel.
Neeraj Gupta
Neeraj Gupta, Co-founder and COO of Blance, holds both B.Tech and M.Tech degrees from IITKGP. With a career spanning 6+ years in Fintech, he is a seasoned professional and a 1-time Founder, having played integral roles in Money View, GAIN Credit, and Zype.
Pankaj Gupta
Pankaj Gupta, Co-founder and CTO of Blance is an alumnus of IITK, holding both B.Tech and M.Tech degrees. With over 6 years of experience in Tech and data, he is a 1-time Founder who has made significant contributions to companies like Adobe, ShareChat, Udaan, and Lohum.
Blance – Startup Story
Back in 2020-21, when the coronavirus pandemic hit, Ashutosh, Neeraj, and Pankaj were brainstorming ways to create something new and amazing that could help people feel connected during this difficult time. Ashutosh came up with the idea of building a dating site, and soon that idea evolved into a small project, eventually becoming a startup. This was the first idea that the co-founders of Blance worked on together. However, they later pivoted to building a community ed-tech startup, which unfortunately did not take off.
But their journey didn’t end there!
While Ashutosh, Neeraj, and Pankaj were building their first startup, Hunkaar, they realized that in order to accept payments from tier 2, 3, and beyond cities, they needed to provide a savings solution. This is where the idea of Blance came into play.
Fast forward to 2022, they began working on savings plans and schemes, which led them to develop the concept of “Save Now, Buy Later.” Throughout this journey, they faced multiple attempts and failures, but they never gave up on their determination to build something that people truly wanted.
After researching the “Save Now Buy Later” idea for about 5-6 months and conducting proof of concepts, they started building Blance, and that’s when it became a force to be reckoned with.
Blance – Vision and Mission
Blance’s mission is all about striking the perfect balance in the financial journey, ensuring users save, take credit responsibly, and enjoy exciting rewards along the way.
Blance’s vision is to become a full-stack solution for consumers in India to manage their finances and achieve their dreams.
Blance – Products/Services
Blance is recognized as India’s one & only goal-based saving & credit fintech startup. Based in Bengaluru, Blance has launched a beta program to help Indians, especially young adults, to improve their financial wellness. Blance offers discounts for planning purchases in advance, which can help consumers to save money and reach their financial goals. To avail of these discounts, the user has to download the Blance app from the Google Play Store.
Blance is building to help people save for their future purchases & get up to 25% off. Blance also helps its users fast-track their goals through a credit offering. The best part is there are no commitments, users can switch brands & earn 10% fixed interest even if they cancel their goal anytime.
Blance does this by clubbing credits, rewards, and discounts along with saving with various partner brands. Blance helps users save, generate returns on their savings, partners with brands to get extra discounts so users don’t have to haggle with brands, & finally, if users want to fast-track their goal or have missed their goal, Blance helps them complete their goal by taking credit for it.
Blance has partnered with RBI Regulated NBFCs and banks & has also been recognized by Startup India. For Blance, the users’ data & privacy are the supreme priority, and that is why Blance takes strict measures to make it 100% safe & secure.
Over 93% of the Indian population lacks access to credit. As a result, many rely on their hard-earned savings or informal credit to make high-value purchases. Through conversations with people across India, Blance has found that while many save diligently for their goals, they often turn to credit when they encounter budgeting challenges or haven’t reached their savings targets.
When it comes to significant purchases like bikes, cars, etc, individuals save for down payments and book vehicles at retail stores, again facing challenges such as bank account not beating inflation, securing a favorable car loan, and negotiating discounts. Achieving financial well-being requires a balance between savings, credit, and rewards. However, today we don’t get rewards for high-ticket purchases made through savings.
At Blance, the mission is to help users find the perfect balance between savings, credit, and rewards. Blance empowers its customers to achieve financial independence and personal growth. When savings are combined with credit and rewarded appropriately, they become a catalyst for financial success.
For any fintech, building trust with customers poses a challenge. Blance is 1000% focused on solving for trust. With a dedicated Chief Trust Officer responsible for creating trust around the brand and generating new ideas, here are some strategies the CEO, Ashutosh wrote about building trust:
Blance – Key Tools and Software
Blance utilizes a variety of key tools and software to efficiently run the startup. These include:
Blance’s future plans include expanding to other Tier 1 & 2 cities in India in the next few months, with a commitment to providing comprehensive financial solutions for users across the country.
FAQs
What does Blance do?
Blance offers discounts for planning purchases in advance, which can help consumers save money and reach their financial goals.
Who are the founders of Blance?
Ashutosh Prakash Singh, Neeraj Gupta, and Pankaj Gupta are the co-founders of Blance.
How does Blance generate revenue?
Blance drives revenue through subvention from brands, a commission percentage on savings, and a commission percentage on credit transactions.
How has Blance contributed to financial inclusivity?
Blance’s user-centric approach has made goal-oriented saving and credit accessible, ensuring financial inclusivity for a diverse audience.
StartupTalky presents Recap’23, a series of in-depth interviews where we engage with founders and industry leaders to explore their growth in 2023 and their predictions for the future.
The fintech sector, a dynamic fusion of finance and technology, is transforming conventional banking and financial services. Digital payments, blockchain, and robo-advisors are changing the way we handle financial transactions. Emerging companies in this field concentrate on delivering easy-to-use interfaces, streamlined transactions, and tailored financial services.
The worldwide online trading market is projected to grow at a CAGR of 6.4%, reaching approximately $13.3 billion in 2026 from $10.21 billion in 2022. Additionally, the payments industry aims for a transaction volume of $100 trillion and $50 billion in revenue by 2030.
In a recent Recap’23 interview, we at StartupTalky had the privilege of connecting with Sarvjeet Virk, Co-founder and MD of Finvasia. We delved into how Finvasia’s innovation is reshaping the fintech landscape, examining its progress, challenges, key insights, and future strategies.
StartupTalky: What service does Finvasia provide? What was the motivation/vision with which you started?
Sarvjeet Virk: Finvasia, founded by my brother Tajinder and me, is a technology-driven company with Shoonya as our flagship brand in India. Shoonya, our innovative multi-asset investment platform, follows a zero-commission model, eliminating fees such as commissions, clearing, and technology charges. Our commitment to affordability and accessibility led us to break away from traditional brokerage fee structures. Despite the challenges, our tech-first approach enabled us to achieve a zero-trading experience efficiently.
A decade ago, during our time in the US, we identified challenges in the Indian capital market, particularly high brokerage fees for foreign investors. This realization prompted us to establish Finvasia, aiming to revolutionize the financial services sector with cutting-edge, real-time solutions for investors of all experience levels. Subsequently, Shoonya was developed to address these challenges.
Coming from backgrounds in both technology and finance, we envisioned leveraging technology to simplify finance for everyone. Initially operating as a Foreign Portfolio Investor (FII) in India, Finvasia’s rapid growth led to the creation of Shoonya. By identifying market pain points, we designed Shoonya as a true-zero brokerage platform, making trading accessible and affordable for investors and traders.
StartupTalky: What new services have been added in the past year? What is/are the USP/s of Finvasia?
Sarvjeet Virk: We are dedicated to enhancing our services through the integration of artificial intelligence (AI) to offer seamless investing and trading experiences. In line with this commitment, we introduced ‘I Know First’ in 2023 – an AI-powered tool empowering users with insights like signal analysis on a dataset of 1,500 Indian stocks and historical data. This tool provides access to AI-generated forecasts, along with features such as Colour-Coded Signals, Instant Heatmaps, Wave Trend Predictions, and Performance Predictions, enabling well-informed decisions.
Traditionally, comprehensive data and insights were accessible only to seasoned professionals, but Shoonya is changing the game by making these available to retail investors. This democratizes the trading process, thanks to the incorporation of cutting-edge technologies like AI and ML for an enhanced trading experience.
Furthermore, Shoonya stands out as the only true-zero brokerage platform in India. As a clearing and trading member, we offer the lowest cost to trade for retail investors. With approximately 16 services provided at no charge, including account opening and maintenance, we ensure transparency without hidden fees. This distinguishes us significantly from the competition, as users are not burdened with fees for each transaction.
Sarvjeet Virk: StartupTalky: How do you stay up-to-date on the latest trends and developments in the fintech industry?
Sarvjeet Virk: Staying informed about the latest trends and developments within the industry is crucial. From newspapers and news channels to social media platforms, I rely on different channels to stay up-to-date on emerging trends. I keep a close eye on reports that delve into past reviews and future projections, particularly on the financial market, capital market, and technology. Staying proactive keeps me well-informed and prepared to navigate the dynamic landscape. Also, I spend time on various Industry reports that give current and future perspectives.
StartupTalky: What were the most significant challenges Finvasia faced in the past year, and how did you overcome them?
Sarvjeet Virk: In 2023, we navigated through a year of challenges and opportunities. While it was generally a successful year for us, we faced an unexpected technical issue on our trading platform in April. Thanks to the quick response from our technical team, we promptly addressed and resolved the issue. In line with our commitment to providing an exceptional customer experience, we covered losses totaling Rs 3 crore. Our top priority remains ensuring customer satisfaction and maintaining their trust. This action reflects our unwavering dedication to our vision and brand values.
StartupTalky: What are the different strategies you use for marketing? Tell us about any growth hack that you pulled off.
Sarvjeet Virk: Our marketing approach aligns with SEBI’s advertising guidelines for the finance sector, ensuring transparency and empowering users to make informed decisions. With a primary focus on digital channels, we effectively utilize social media and various platforms to engage diverse user groups, resulting in substantial growth. In November, we experienced a significant surge in new users, consistently ranking among the top 20 brokers for adding active clients monthly. The year 2023 marked an impressive 150% year-on-year growth attributed to our impactful digital marketing strategies.
To further enhance user knowledge, we regularly share educational and informative content on our social media channels. Additionally, we are in the process of establishing an education portal on our platform catering to both beginner and advanced users.
StartupTalky: What opportunities do you see for future growth in the fintech industry in India and the world? What kind of difference in market behavior have you seen between India and the world?
Sarvjeet Virk: We witnessed a notable rise in the prominence of artificial intelligence (AI) in 2022, and its influence continued to grow globally in 2023. Looking forward to 2024, we anticipate that AI will evolve into a mainstream phenomenon, with a diverse range of applications becoming more prevalent. In the upcoming year, a significant development is expected in the integration of AI across various regional languages, aiming to achieve genuine last-mile reach. While complete coverage may be an ambitious goal, I believe initial steps will be taken to make this vision a reality.
The market dynamics in India have undergone a noticeable shift, especially in terms of capital market participation. Traditionally, there was a hesitancy among Indian individuals and businesses to actively engage in the capital markets. However, internet accessibility has brought a significant change in this trend. The widespread availability of online platforms has empowered more people in India to explore and participate in capital markets, marking a departure from past reservations.
Substantial differences emerge when comparing the capital market participation between India and other global players like China and the United States. As of 2023, the United States dominates the world stock market, accounting for nearly 60% of its total value, followed by Japan and the United Kingdom. In contrast, India represents a relatively modest 1.8% of the total global equity market value. At Shoonya, we are working towards enabling more users to participate in the capital market.
StartupTalky: What lessons did your team learn in the past year, and how will these inform your future plans and strategies?
Sarvjeet Virk: The introduction of I Know First on our platform has garnered a positive response from users, highlighting its value. Recognizing the pivotal role AI will play in the near future, our office is currently experiencing a significant surge in AI-related initiatives. We’ve proactively initiated group learning sessions for the entire team, immersing them in the vast potential of AI. The enthusiasm within the team is palpable, and this collaborative learning approach has rapidly enhanced our understanding and application of AI in real-world scenarios. Beyond being educational, it’s an engaging and thrilling journey for all of us.
StartupTalky: How do you plan to expand the customers, service offerings, and team base in the future?
Sarvjeet Virk: Finvasia has recently achieved significant milestones, obtaining an NBFC license in India and an investment bank license in Mauritius. These licenses are crucial for our ultimate goal of financial inclusion. Our proactive efforts in the past year involved developing new products around these licenses, although specific outcomes are still in progress. We are working towards building a global business from India, and international licenses play a crucial role in this strategy.
Additionally, our focus on AI goes beyond the predictive feature. We’re actively exploring additional ways to leverage AI to enhance the user experience. It ranges from enhancing onboarding journeys to in-app features. I’d like to save the details for when the features are live on the platform.
Another notable achievement is the establishment of Finvasia’s Mumbai office, complementing our existing base in Chandigarh. Our presence in the financial hub of the country aligns with a long-standing aspiration and contributes to our overall strategy for growth and expansion. As we look ahead, our focus remains on expanding our customer base, enhancing service offerings, and strengthening our team to further solidify Finvasia’s position in the financial landscape.
StartupTalky: One tip that you would like to share with another service company founder?
Sarvjeet Virk: There isn’t a one-size-fits-all formula for building a successful business. My suggestion to a fellow founder would be that what worked for others may not be the ideal path for you. Reflecting on our own experience, many doubted the feasibility of establishing a successful FinTech firm in a smaller city like Chandigarh. However, we remained steadfast in our convictions and have achieved considerable success. The essential takeaway is to ignore external skepticism, concentrate on your unique journey, and rely on hard work, determination, and learning from mistakes to navigate the path toward your goals.
StartupTalky extends its gratitude to Mr. Sarvjeet Virk for dedicating his valuable time and generously sharing his insights with all of us.
StartupTalky presents Recap’23, a series of in-depth interviews where we engage with founders and industry leaders to explore their growth in 2023 and their predictions for the future.
The fintech industry, a dynamic blend of finance and technology, is revolutionizing traditional banking and financial services. Digital payments, blockchain, and robo-advisors are reshaping how we manage money. Startups in this sector focus on providing user-friendly interfaces, efficient transactions, and personalized financial solutions. The industry’s rapid growth is fueled by innovations like peer-to-peer lending, contactless payments, and mobile banking.
India’s fintech sector is set for substantial growth, with a projected $1.3 trillion Total Addressable Market by 2025. By 2030, Assets Under Management and Revenue are expected to reach $1 trillion and $200 billion, respectively. The payments landscape aims for impressive figures, targeting a transaction volume of $100 trillion and $50 billion in revenue by 2030.
In a recent Recap’23 interview, we at StartupTalky had the privilege of connecting with Roshan Shah, Co-founder and MD of VoloFin. We explored how VoloFin’s innovation is revolutionizing the fintech industry by analyzing its development, hurdles, insights, and future strategies.
StartupTalky: What service does VoloFin provide? What was the motivation/vision with which you started?
Roshan Shah: We are an industry-first comprehensive Fintech platform, providing end-to-end solutions in the domains of factoring and supply chain financing. Traditionally, this business was done by banks. Even today, they continue to work but provide services only to large clients. Moreover, the cost of compliance and acquisition is extremely high for the banks. This has opened up opportunities for FinTechs to step into the picture. Some Fintech companies are operating in the lending business and are acting as a substitute for banks by providing financing to borrowers. However, at VoloFin, we are uniquely positioned as both a lender and a platform where even banks can participate in the factoring business, and we strive to provide complete end-to-end solutions.
We started with a clear motivation to support the platform’s growth by providing the business with much-needed trade finance, which otherwise is a struggle for most of the organizations. Our idea of creating an end-to-end platform was to provide borrowers with quick and easy access to trade finance and at the same time allow banks to participate and grow their business. Our in-house proprietary tech platform is the core foundation of our platform, empowering us to play the role of both a lender and a platform, facilitating the banks to partner with us, and offering factoring as a ready solution. We offer factoring solutions delivered through a next-gen platform that digitally manages customer onboarding, KYC, credit, compliance, documentation, buyer approvals, transaction handling, disbursement, monitoring, collection, and credit insurance wrap. The lending frameworks are customized based on the lender’s credit guidelines and focus.
We have already onboarded various lenders on our platform, including banks and funds and are in the process of onboarding other banks, which will benefit significantly from partnering with us than doing it themselves. They will benefit in terms of cost, effort, efficiency, TAT, and having a solid credit framework provided by us.
Our endeavour is to revolutionize lending across industries, from SMEs to large corporates. We further intend to spread awareness about factoring through different initiatives. We are also aiming to facilitate easy access to capital with a seamless blend of expertise and technology. We envision emerging as the most reliable, trusted, and largest Fintech for borrowers and banks in the times to come.
StartupTalky: What new services have been added in the past year? What is/are the USP/s of VoloFin?
Roshan Shah: We are the industry’s first comprehensive invoice and supply chain financing platform, providing end-to-end solutions ranging from origination and collection to credit protection with insurance to platform lenders. Additionally, we provide an array of services for our clients (suppliers) and lenders, whether it is protecting them against buyer non-payment risk, providing them with collateral-free financing, and best-in-class in-house proprietary tech platform that offers full-stack supply chain solutions to lenders and banks; or ensuring quick supplier KYC and compliance through extensive integration, ability to underwrite buyers globally, and providing framework-based lending models with banks.
We provide fast and easy access to funds, as well as non-recourse and collateral-free financing to our clients. We take the buyer default risk upon ourselves and provide funding to suppliers over and above their existing banking limits. This way, they are relieved from the payment-related hassle and can grow their business, take more orders, and increase their production capacity.
Why do banks partner with VoloFin?
Business Model – Unlike any other platform providing end-to-end solutions
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Credit Protection – SandP ‘A’ and above global credit insurer
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Best-in-class tech platform
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Flexible fund deployment structure/framework
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Proven with other banks onboard
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Experienced and strong team
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High origination capabilities
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Quick KYC, onboarding, and underwriting (supplier as well as buyer)
StartupTalky: How do you stay up-to-date on the latest trends and developments in the fintech industry?
Roshan Shah: Today, the market is highly competitive, and staying abreast with the latest industry trends and developments is critical to success. Keeping a tab on the recent government regulatory policies to adapt business as per the ongoing changes is the key to scaling the business. Additionally, monitoring the emerging technologies, products, or services in the industry keeps us on the right track. Actively participating in industry events and conferences is also essential, as they provide networking opportunities and insights about the latest emerging trends and technology.
Staying in touch with industry peers and indulging in meaningful conversations with them enables us to understand the market better and build strategies for business growth. Moreover, a strong network of our channel/strategic partners keeps us abreast with market and industry updates as well. Staying connected with our clients also gives us good insights into industry developments.
StartupTalky: What were the most significant challenges VoloFin faced in the past year, and how did you overcome them?
Roshan Shah: In the past year, I feel the increase in the interest rates has posed a challenge to us in maintaining the rates we offer to the clients. While it was not easy, we focused on onboarding more lenders with lower costs of capital to ensure we could service our clients better without having them face the direct impact of increased rates. We sought an opportunity in this challenge, and it motivated us to strive for better client solutions, which was and is well appreciated by them as we stood by them in times they needed us most.
StartupTalky: What are the different strategies you use for marketing? Tell us about any growth hack that you pulled off.
Roshan Shah: In today’s social media-driven world, leveraging social networking platforms is a key component of the new-age marketing strategies. Hence, we also use the channels of content marketing and email marketing to reach our target audiences effectively. Additionally, knowledge sharing through emails and brochures with our existing clients and prospects helps build strong connections with them. We also try to participate in various industry events and seminars, and this strategy gives us visibility and helps us establish a strong brand reputation in the market.
StartupTalky: What opportunities do you see for future growth in the fintech industry in India and the world? What kind of difference in market behavior have you seen between India and the world?
Roshan Shah: The Fintech industry in India has evolved and brought the potential of banking to the non-banking or under-banked population as well. The Digital India initiative with the government’s support, has changed the face of India on the global front. It provides easy financial facilities and services, along with growth opportunities.
The inclusion of mobile wallets, digital payment gateways, blockchain, and platform-based transactions has opened avenues for emerging and established Fintech companies. Market behavior has transformed with mobile wallets and UPI-based payment gateways taking center stage in the financial landscape. This has pushed Fintech companies to provide financial solutions and easy credit line services to SMEs, MSMEs, and individual consumers. If we draw a comparison, the Indian government supports Fintech companies with a more stable and mature set of regulations than the other markets.
We are witnessing increased client awareness in our Industry in India. The acceptance of companies using factoring is growing significantly. The companies are now using the product to their advantage, given it is quick, easy, collateral-free, and is an additional source of trade finance. Factoring is a big industry in most developed economies, but now the tech-driven trade finance FinTechs are gaining more traction in those markets.
StartupTalky: What lessons did your team learn in the past year, and how will these inform your future plans and strategies?
Roshan Shah: We have a very strong and experienced in-house team that is well-informed and updated with industry trends, future expectations, etc. The real learning as such would be to continue to keep our focus on the clients and be solution-oriented, as not always the same product applies to all.
StartupTalky: How do you plan to expand the customers, service offerings, and team base in the future?
Roshan Shah: We have a robust in-house origination team, which we are continuing to expand. We have a mapped future talent pool base that we have planned to onboard in the coming months.
We are already offering additional solutions to clients with our trade expertise, whereby certain transactions are trade-supported if not financed directly, like CAD payment terms, etc. We will be making a formal announcement of these solutions later in the year while we continue to execute some transactions currently.
StartupTalky: One tip that you would like to share with another service company founder?
Roshan Shah: Building a strong rapport with your stakeholders is crucial for your success. And to establish meaningful, long-lasting relationships, trust and transparency are the most important factors.
StartupTalky extends its gratitude to Mr. Roshan Shah for dedicating his valuable time and generously sharing his insights with all of us.
2023 is a year that loan app companies and fintech companies may want to erase from their memory. Fraudulent loan app companies, extortion cases, and a rigorous crackdown by policymakers have meant that the whole cart is being painted black.
However, some loan app companies and fintech companies continue to pin their hopes on a better 2024 with consumer awareness programs, smarter risk-priced products, and collaborations to clean up the much-tarnished image of the sector.
Digitization has hit nearly every aspect of life, and credit availability is not very far behind. A report released by banking regulator Reserve Bank of India showed that loans disbursed by banks and non-banking finance companies through the digital mode multiplied 12 times between 2017 and 2020. With the rise in several disbursements, the grim underbelly of several loan app companies has also been exposed.
Earlier this month, Finance Minister Nirmala Seetharaman intimated the Lok Sabha, saying that between April 2021 and July 2022, Google Play had reviewed up to 4000 loan app companies and had removed more than 2500 loan apps from its Play store. Several debtors have been driven to death by extortion calls and threats, some even being sent morphed pictures of theirs, highlighting the dark side of loan app recovery agents.
However, some of the more reputed companies are trying their best to clean off this image of loan app companies.
“We continuously explain to our end consumers through online as well as offline mediums to not fall into offers that look very attractive or that are available through WhatsApp, SMS, and SMS calls,” said Rajesh Shet, founder of gold loan platform company Sahi Bandhu.
The regulators, too, are putting in all efforts to curb unsolicited apps. Recently, the Ministry of Information and Technology has asked the Reserve Bank of India to have more exhaustive Know-Your-Digital-Finance-App norms.
“This will ensure that only legitimate and scrutinized financial apps can access and use the Indian banking system, and further, if there is any violation of law, the KYDFA process will help in establishing the traceability and origin of the app for action under the law,” Minister for State for Electronics and Information Technology Rajeev Chandrasekhar told the news website Moneycontrol.com.
Risk-based Pricing
The issue of defaults within the loan app universe unravels a chicken-and-egg situation wherein companies are going overboard with selling products, thereby ending up sitting with bad loans on their books.
“Within the fintech industry, to increase the top line, some companies are trying to sell everything possible, even if customers are not looking for a loan or a credit card. They are trying to cross-sell and try to bring in lucrative deals or offers,” said Brijesh Chokhra, co-founder of the instant loan app company Wecredit.
Instant student loan app company Kuhoo Founder and Chief Executive Officer Prashant Bhonsle feels lending needs to be dealt with in a nuanced fashion to make it work for both the company and the customer.
“There are interpretations that a lender will have to do to fully understand, such as the income documents of the customer, the P&L, and the ITR. Some businesses you are evaluating are cash-flow businesses, and some are asset-heavy businesses. How do you interpret that information? And that interpretation is the secret sauce, which varies from lender to lender,” said Bhonsle.
Talking about Kuhoo’s focus area of student loans, the skill was to evaluate the potential of every student to get a job, Bhonsle said.
The regulators are, however, not taking any chances.
Recently, the RBI asked banks and non-banking finance companies to increase the risk weights on commercial loan exposure and credit card exposures to 125% from 100% earlier. Interestingly, several digital lending apps borrow from NBFCs too.
Rating agency ICRA recently observed in its press release that co-lending transactions by medium and small non-banking finance companies were “on the rise, largely seen in the unsecured loan segment, with the counterparty mostly being other NBFCs.”
Attributing to RBI data, Minister of State for Finance Bhagwat Karad said in the Lok Sabha earlier this month that NBFC’s share of credit to the industry was the highest at 12.83 lakh crore INR, registering a 12% rise year on year. This was followed by retail loans at 10.55 lakh crore INR, recording a near 26% rise on the year.
According to Bhonsle, appropriate “risk-based pricing” holds the key to a successful lending business.
“The Indian economy is growing rapidly, and with it, the demand for financial services. The coming years hold immense promise, and innovators across the world should explore these opportunities,” RBI’s Governor Shaktikanta Das said in a speech in September.
“Technological innovation has unprecedented potential to make finance more inclusive, competitive, and robust. It is crucial that technological advancements in the world of Fintech evolve in a responsible manner and are truly beneficial to the people at large. It is, therefore, vital for these innovations to be scalable and interoperable,” he added.
One of the ways to scale up operations for fintech companies would be through mergers, such as the one between the digital lending app Slice and North East Small Finance Bank in October. Touted as a breakthrough strategy to scale up, players are hoping for more such collaborations within the industry.
“I strongly believe that this industry will have to work closely and collaboratively, keeping common interests in mind. There will be competition, but there are common industry concerns and matters that require collaboration. And then, at some stage, there will not be enough room for many players. That’s when one will have to join hands and see who is good at what. Someone may be very good in tech, and someone may be very good in customer onboarding,” said Shet of Sahibandhu.
India’s growth prospects also hold promise as far as credit demand is concerned. Rating agency S&P revised its growth projection for India in 2023–24 to 6.4% from 6% earlier. For the next fiscal, however, it lowered its projection marginally to 6.4% from 6.9% earlier.
“India as an economy is doing so well, and this asset class (real estate) has shown returns year after year. I do see a lot of innovation on the FinTech side, particularly on the home loan side, because it seems like the norm of the regulators to allow the account aggregator framework to become more popular, which means that digital information will be a lot more freely available to many players who are part of the account aggregator framework,” said Pramod Kathuria, founder and CEO of AI-enabled fintech platform for home loans, Easiloans.
Conclusion
Fintech companies and digital lenders are hoping for a more responsible and cheerful 2024. While technological innovations unlock their potential further, the only thing that could put a spanner in their tracks would be unscrupulous lending by themselves.
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In our haphazard daily life, we tend to get busy with several things and forget about payments and maintaining a log of all the financial transactions. This, sometimes, becomes extremely hectic and might even affect businesses adversely in a whole host of ways. However, with the emergence of numerous business management software, businesses and individuals can manage their businesses effortlessly. Khatabook is one of such reliable software solutions that makes managing business and personal ledgers a breeze!
Founded in 2018 in Bangalore, Khatabook is hailed as India’s fastest-growing SaaS company. Khatabook reminds you through WhatsApp or SMS when the money is due to be paid or collected. forgetting the due dates of payments to be made. Besides, handling multiple businesses will no more be a deal with Khatabook!
The micro, small and medium businesses of the country simply has a new name, Khatabook, which brings safe and secure business and financial solutions to increase efficiency and reduce costs.
Here’s diving into Khatabook’s journey in this StartupTalky article, where we will find out more about Khatabook Founders and Team, Funding and Investors, Startup Story, Tagline and Logo, Growth, Business and Revenue Model, Challenges, Competitors, Future Plans and more.
The latest campaign of Khatabook #DhandeKaDoctor featuring MS Dhoni, urging small businesses to use Khatabook to maintain their account.
Khatabook – Latest News
9th November 2021 – Khatabook has decided to shut down MyStore, the eCommerce enablement of the company, which has been a core product of the company, effective from 15th November onwards.
24th August 2021 – Khatabook concluded its Series C round of funding with a fundraise of $100 million led by Tribe Capital, Moore Strategic Ventures, Alkeon Capital, B Capital Group, Sequoia Capital, and more.
3rd February 2021 – Khatabook released its 2020 statistics. In 2020, Khatabook activated merchants in >95% Indian districts, recording over $100Bn+ in transactions with over 150Mn+ customers.
13th January 2021 – Out of the 7 Indian startups in Y Combinator‘s latest top companies’ list, Khatabook is one among them. India has emerged as an important market for Y Combinator.
Khatabook – About and How it Works?
Founded in January 2019, Khatabook is the fastest growing Saas company in India and one of the fastest-growing SaaS company in the world. It has become India’s leading business management app for MSMEs with 20M+ downloads in a remarkably short period of time. It operates the Android-based Khatabook app that enables companies to keep a digital log of their financial transactions and accept payments online.
Khatabook enables micro, small and medium merchants to track business transactions safely and securely. The app is available in over 12 vernacular languages, catering to a diverse audience in the country.
It helps businesses and individuals manage the business and personal ledgers on their phones and computer devices along with helping them recall the due dates with the help of effective SMS and WhatsApp reminders about the same. This Bangalore-based mobile app service shares WhatsApp and SMS reminders to users when the money is due to be paid or collected.
The Khatabook app has a free ‘Payment Reminders’ feature. With this feature, an automatic SMS is sent to your customers every time a transaction is recorded. Khatabook lets its users keep all details of credits and debits for any number of customers across multiple businesses ready and handy on their phones. Furthermore, Khatabook also helps its customers sync their transactions automatically, download, share and maintain reports of all the transactions, reap all the benefits of the effective QR code-based payments with 0% fees on transactions and more. In short, this app lets merchants do stress-free business.
Khatabook – Industry Details
Khatabook’s founder Ravish Naresh revealed on Twitter that Khatabook activated merchants in >95% Indian districts with 150Mn+ Customers. Based on the Indian MSME Data, Khatabook conducted research and analysis on the credit behavior of people across the country and also the impact of Covid-19 on small businesses.
Over 2020 @Khatabook activated merchants in >95% Indian districts, recording over $100Bn+ in transactions with over 150Mn+ customers. A good chunk of India's retail GDP is already being recorded on the platform and trade flows from across the country are getting digitized. pic.twitter.com/aVcZTlVBGM
Business volumes on credit are 45% higher for South Indian states vs the national average.
Credit given out by Khatabook merchants dropped by 40% in the initial Covid months. It has continued to recover to 80% of pre-pandemic levels by December.
Average days to recover debts increased by 25% during COVID for Khatabook Merchants.
Sectors like travel, construction, apparel were more impacted during 2020.
Khatabook – Founders and Team
Vaibhav Kalpe originally built Khatabook, which was later acquired by Kyte Technologies in 2018. Kalpe later joined the owning team of Kyte before he left the organization. The founding team of Khatabook currently has Ravish Naresh leading the company as the Co-founder and CEO along with other co-founders – Ashish Sonone, Dhanesh Kumar, and Jaideep Poonia.
Khatabook – Founders & Team
Ashish Sonone
The Co-founder of Khatabook, Ashish Sonone is a IIT Bombay Btech graduate in Computer Science. JetSynthesys Pvt. Ltd and Qiosk – News for Professionals were the companies where Sonone worked as a Software Engineer and Consultant respectively before co-founding Frodo and Kyte, in both of which he also served as a Backend Engineer. Khatabook is the third company that Sonone has co-founded.
Dhanesh Kumar
Another Computer Science and Engineering from IIT Bombay, Dhanesh Kumar started with Amazon as a Software Developer, who then realized his entrepreneurial and decided to co-found Knit Messaging, Kyte and now Khatabook, where he is still serving as a Co-founder.
Jaideep Poonia
Jaideep is an IIT Bombay alumnus from where he completed his Btech in Civil Engineering before completing S18 from Y-Combinator. Poonia has also been the co-founder of Knit Messaging, Kyte, and Khatabook as Dhanesh Kumar.
Ravish Naresh
Co-founder and CEO of Khatabook, Ravish Naresh completed his Btech from IIT Bombay, much like the other co-founders of the company, after which he co-founded Housing.com, where he also served as a COO. It was after leaving Housing.com, Ravish co-founded Khatabook, where he is still working as a CEO.
Khatabook currently works with around 300 employees.
Khatabook – Startup Story
The story goes back to 2016, when Ravish Naresh along with his team of college friends, started a digital spend manager app, Kyte.ai. The app helped users understand their expense patterns using their SMS alerts. Kyte initially had good traction but did not reach the expected growth scale. Also, the team realized all their users were based out of metropolitan cities.
On researching, they found that first-time online users did not deal with digital transactions, and they still rely on traditional khata or ledger books. As per Ravish, they wanted to build something that people want and then try to build a business around it.
That is when the idea for Khatabook developed, and they started to work on a simple cash management app, which they named Khatabook. The parent company of Khatabook is Kyte Technologies.
Khatabook – Mission and Vision
The mission statement of Khatabook says, “Empowering Udhari Khata (Book-Keeping)”.
“Started with a vision of transforming India’s small shops, today we are the biggest player in the small business segment digitizing a sector that forms the backbone of our economy. We are looking to work closely with the government and financial institutions to strengthen our market leadership and help MSMEs increase their income while making them more efficient and competitive,” said Ravish Naresh, CEO of Khatabook.
Khatabook – Tagline and Logo
The tagline of Khatabook is Business Hua Easy! The app lets every business go digital instead of following the same traditional method of book-keeping and making it easy to grow their business.
Khatabook’s logo itself signifies what the company is all about. It maintains a digital record of all the transactions we make, something which our actual ‘Khatabook’ (the diary in which we maintain our financial record) does.
Khatabook Logo
Khatabook – Business Model
Khatabook is a mobile app that helps small merchants to digitize their accounting and credit balance recording. It helps to reduce the burden of bookkeeping and accounting. It is just like having a khata in your pocket. The business model of Khatabook is making “Bharat” / India come online.
It is 100% free to use and secure for all types of businesses with which shop owners can record credit (Jama) and debit (Udhaar) of customers. But Khatabook has no revenue source at present.
Ravish Naresh, CEO of Khatabook, said they’re now developing the app to provide a complete financial solution for small businesses. The startup has plans to bring a host of new features onto the platform and UPI payment is next on the line.
Khatabook has seen some growth in the past two and a half years, where it has emerged as an integral part of the MSME community in almost every district in India. A majority of the merchant users on the Khatabook platform have embraced the digital practices dumping their offline business practices.
Furthermore, Khatabook has also introduced 3 other solutions apart from the Flagship Khatabook for the benefit of the MSMEs:
Biz Analyst – This is a leading SaaS business management solution from Khatabook designed to offer premium value-added on-demand services like sales and purchase reports, livestock updates, and other MIS reports. Biz Analyst can be integrated with Tally ERP9 and allows an overall view of the business operations.
Pagarkhata – This is a staff management platform for businesses by Khatabook which aims to help merchants to turn the staff attendance, payroll/wages, attendance updates, leaves, payments, and other processes digital.
Cashbook – Cashbook is another platform by Khatabook built as a cash handling and tracking solution. Furthermore, it also helps with cash sales and expense management.
In 2020, Khatabook has active merchants in 95% of Indian districts, recording over $100 Billion in transactions with over 150 million customers.
Khatabook has recorded total revenue of Rs 17 crore during FY21, thereby registering a 25.3% decline from Rs 24.4 crore. The startup’s revenue from operations, currently recorded at Rs 16.9 crore, witnessed a dip of around 30.7% from Rs 24.4 crore that it posted in FY20. On the other hand, the other income of the startup rose from Rs 12.7 crore in FY20 to Rs 21 crore in FY21.
Diving into the profit-loss segment, it has been discovered that Khatabook has managed to reduce its loss by 63%, which has been brought down from Rs 89.5 crore to Rs 33 crore. This is primarily due to the selling of its intellectual property, some of which it sold to its holding company, Kyte Technologies Inc. for around Rs 57 crore.
In FY22, the company experienced significant growth in its operating revenue, surging from Rs 17 crore in 2021 to an impressive Rs 71 crore. However, this growth was accompanied by a corresponding increase in total expenses, which escalated from Rs 109 crore in FY21 to Rs 189 crore in FY22. Consequently, the company’s losses also saw a substantial rise, soaring from Rs 33 crore in FY21 to Rs 111 crore in FY22 during this period.
Here’s a look at the financials of Khatabook:
Khatabook Financials
Operating revenue for the Khatabook increased by 14% in FY23 to Rs 81 crore. Conversely, there was a marginal rise in losses of 4% to Rs 125 crore. Due to increased employee benefit costs (wages, salaries, PPF, etc.), which amounted to over Rs 142 crore, the company’s total expenses stayed steady at Rs 223 crore, a slight increase from Rs 189 crore in the year FY22.
Khatabook – Growth
Khatabook has registered around 10 Million monthly active users and the numbers are growing.
Growth had an excellent trajectory, which did take a hit during the lockdown in line with other external factors. With the relaxation of the lockdown, the company started reviving the business at a steady pace. The revival has been faster with users in tier-2 and tier-3 cities of India.
As a very relevant offering for merchants in the pandemic, the company also launched the MyStore app to enable them to take their stores online in 15 seconds and continue doing business through their preferred communication channels.
Within a month after the launch, more than 2.5 million merchants across India have installed MyStore. Khatabook also initiated work from home active, 24/7 call center support for merchants. Currently, the revenue model of Khatabook depends on its funding.
Some key growth highlights would include:
5 crore+ registered businesses
A spread over 4000+ cities of India
Powered by popular investors like Sequoia Capital, DST Global Partners, Y Combinator, Tencent, B Capital Group and more
Khatabook – Acquisitions
Khatabook has acquired Biz Analyst on March 25, 2021, which remains the company’s maiden acquisition.
Khatabook – Awards and Achievements
Some of the popular awards and achievements that Khatabook has seen so far are:
It was declared as the Winner of Nasscom League of 10 in the Emerge50 Awards 2020
The company’s app won the Best Innovative Mobile App award at IAMAI 2020
mCube announced Khatabook the winner of the Best Content in a Mobile Marketing Campaign in its awards ceremony in 2020
Khatabook – Partnerships
Khatabook currently partners with the former skipper of the India cricket team, M.S. Dhoni, who is an investor as well as the brand ambassador of the company. The strategic partnership was announced on March 17, 2020.
Khatabook – Challenges Faced
Khatabook also faced a shortage of money during its initial days just like other new startups. Ravish, the CEO of Khatabook realized that they need to look into serious funding options.
In the series A phase, they were struggling a bit with the funding. The growth hit them fast, so the seed round took place in 5 bridges. It was the highest in the history of funding for Sequoia.
“Well, the struggles were mainly money-related. We knew we were working on something important and kept going with it. Often it was difficult to imagine the future of our initiatives with no funding, but perseverance is what got us where we are today,” said Ravish Naresh.
He also said that the adoption of their product was not only dependent on the app’s visibility and convenience but also on educating users, not just for the app but also for using digital technology in general. The biggest hurdle was to persuade offline shopkeepers to come online and train them for digital transactions.
Switching away from the convention is understandably tricky and daunting for merchants who mainly have offline workflows. Persuading traditional enterprises to embrace the digital still remains a crucial challenge for them.
“It is important to build something that people want and then try to build a business around it, and that is exactly what the team did.” said Ravish.
Khatabook announced the shutdown of MyStore on November 10, 2021. The eCommerce enablement product was one of the core products of the company, which also contributed to the expansion of the company by raising funds along with helping the company with its bookkeeping requirements.
“Thank you for being a part of the MyStore journey. We are planning on discontinuing the MyStore App. Your MyStore App won’t work from 15 November 2021,” goes a blog post from the company.
The company has further asked its users to download their invoices by sharing order invoices before doing away with the app.
Khatabook had previously been dragged into a legal fight with its rival, Dukaan over the plagiarism of the name when MyStore was named ‘Dukaan by Khatabook’, in August 2020. Khatabook later decided to change it to ‘MyStore by Khatabook after a legal battle of around four months. The tagline of the app, however, remains the same, ”Create Your Online Dukaan in 15 Seconds” to date on Play Store.
Khatabook – Funding and Investors
Khatabook has raised a total of $186.5M in funding over 4 rounds. Their latest funding was raised on 24th August 2021, from a Series C round. Khatabook is funded by 34 investors in total. Tribe Capital and Moore Strategic Ventures are the most recent investors. The valuation of Khatabook was estimated to be around $600 Million in August 2021.
In a strategic move aimed at optimizing costs and prolonging the company’s financial runway, the organization recently made the difficult decision to implement workforce reductions, resulting in the departure of over 40 employees from various departments. These actions were undertaken as part of a broader effort to navigate the challenges faced by growth-stage companies.
While undoubtedly a tough choice, the company’s leadership recognized the importance of preserving its financial stability and ensuring a sustainable future. This move reflects a commitment to adaptability and resilience in an ever-evolving business landscape, with the hope that these measures will ultimately position the company for long-term success.
“Khatabook has laid off 42 employees across sales, marketing and analytics, and technology verticals,” said one of the sources requesting anonymity. “People who lost their jobs in the exercise have been given standard severance packages including 3 months salary among others.”
Khatabook – Future Plans
Khatabook plans to expand and achieve two to three times business growth by simplifying the traditional way of doing business. Remaining committed to India’s MSME segment, Khatabook will be adding services to streamline and simplify business processes for the merchants.
“Committing to a goal is essential for business directions and decisions. One thing that pandemic has taught us is that we need to think through the most unlikely scenario and make sure we are relevant in all possible scenarios or are agile enough to change our direction as per the need of the hour,” says Ravish.
Khatabook has already managed to build a widely accepted tech ecosystem for the MSMEs across the country and will now concentrate on the disbursement of financial services through its tech platforms. These financial services will further enable smooth lending, payment, and deposits in the MSME space.
Khatabook is eyeing the right partnership opportunities to seamlessly roll out the solutions that would benefit the economic aspirations of countless small businesses.
Khatabook has announced a buyback scheme of ESOPs worth USD 10 Million in order to acknowledge the contributions of its employees, the ex-employees and the early investors who stayed by the company and helped it grow. The employees who are eligible for the ESOP scheme would be able to sell up to 30% of their vested options. Meanwhile, Khatabook has also expanded its ESOP pool to $50 Mn.
Furthermore, Khatabook is also looking to strengthen its talent base by hiring employees for the engineering, product, design, analytics, and data science departments.
Khatabook – FAQs
What is Khatabook?
Khatabook is the world’s fastest-growing SaaS company. It is India’s leading business management app for MSMEs that enables companies to keep a digital log of their financial transactions and accept payments online. It’s like having a khata in your pocket.
Is Khatabook an Indian app?
Yes, Khatabook is an Indian app founded in 2019 with an aim to reduce the burden of bookkeeping and accounting.
Which company owns Khatabook?
Kyte Technologies is the Parent Company of Khatabook.
Who is the CEO of Khatabook?
Ravish Naresh is the CEO and Co-founder of Khatabook.
Who are the founders of Khatabook?
Khatabook was founded by Ashish Sonone, Dhanesh Kumar, Vaibhav Kalpe (Ex-Khatabook), Jaideep Poonia and Ravish Naresh in 2019.
How does Khatabook make money?
The Khatabook revenue model is non-existent at the moment. Naresh says their focus is now on developing the app to provide a complete financial solution to small businesses.
What is the use of Khatabook?
Khatabook app enables MSMEs to keep a digital log of their financial transactions and accept payments online.
What is the valuation of Khatabook?
The valuation of Khatabook was estimated to be around $600 Million.
Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations.
When it comes to construction lending, the application process moves quite slowly, leading to delayed and inefficient construction projects. Even when project directors verify that every document is accurate, they can still get hamstrung by the lending procedure.
A fintech company, Built Technologies, popularly recognized as Built, proves with its construction and real estate finance platform that such wrinkles in the construction lending process can be smoothed out, resulting in the timely completion of construction work. It is a U.S.-based company fixing lending and spending for the construction and real estate finance ecosystem.
In this article, we will delve into the success story of Built, including its founders, startup story, business and revenue model, funding, growth, and more.
Built, incorporated as Built Technologies, is an enterprise technology company that provides construction and real estate finance platforms. Its centralized platform enables increased efficiency, transparency, collaboration, and business agility while reducing risk and allowing companies to improve how communities around them are built and managed.
The company serves over 270 leading lenders and asset managers and thousands of developers, contractors, and home builders across Portland, Los Angeles, Seattle, Atlanta, and many other cities in the United States.
Built – Industry
Built Technologies, Inc. caters to the financial technology industry, particularly the construction fintech sector. In 2018, the revenue of the fintech industry worldwide was approximately 92 billion euros and is projected to increase by nearly 12%, amounting to 188 billion euros by 2024.
With fintech allowing financial institutions and companies to provide convenient services and help maintain transparency in financial inclusions, it has primarily driven the global market. Moreover, during COVID-19, the adoption of online and digitized financial products significantly increased, positively impacting the fintech industry’s revenue growth. Bankable, Blockstream Corporation Inc., Cisco Systems Inc., and Circle Internet Financial Limited are some leading companies in the fintech industry.
Fintech Sector Worldwide Revenue
Built – Founders and Team
Chase Gilbert, Scott Sohr, and Andrew Sohr are the co-founders of Built.
Chase Gilbert
Chase Gilbert – Co-founder and CEO, Built
Chase Gilbert is the Co-founder and CEO of Built. He completed his graduation in Finance and International Business from the University of Tennessee. Before co-founding Built Technologies Inc. in 2014, he was the Partner and Investor at Taziki’s Mediterranean Café (Green Hills).
Scott Sohr
Scott Sohr – Co-founder, Built Technologies
Scott Sohr graduated from Auburn University in Mechanical Engineering and completed an MBA from Vanderbilt University. Currently, he is the President at STS Ventures Nashville and Canary Ventures. In addition to Built Technologies, Inc., Scott is the Co-founder of Elmington Capital Group and Correct Care Solutions.
Andrew Sohr
Andrew Sohr – Co-founder, Built Technologies
Co-founder of Built Technologies, Inc., Andrew Sohr, studied Management at The London School of Economics and Political Science and earned a Bachelor’s degree in Business Economics from the University of San Diego. Moreover, he owned and invested in Taziki’s Mediterranean Café from 2011 to 2013.
Built is currently working with approximately 350+ employees.
Built – Startup Story
Built was co-founded by Chase Gilbert, Scott Sohr, and Andrew Sohr in 2014. Andrew Sohr was the impetus for the company. He was involved in multiple construction projects and was dealing with many lenders for the same projects. Andrew was frustrated with every lender’s application process because each loan application differed. He said the unique application process for construction loans was not required. Moreover, the construction loan lending procedure also worked slowly.
Chase, Scott, and Andrew discussed Andrew’s problem and possible solutions. It was when Andrew had this idea that there had to be a better way with technology. And three of them started figuring out what is the better way and how does this work. They talked to the lenders, inspectors, and everyone involved to understand why the loan process works the way it works. And then they obsessed over thinking about how it should work to make things better.
It was when they came up with Built Technologies in 2014 to improve the lives of project owners, bank lenders, contractors, inspectors, subcontractors, and other parties involved.
Amid Covid19, Built launched a Portfolio Monitoring Solution for construction lenders, and in February 2021, it launched revolutionary enhancements to make the platform’s Billing process more visible. In December 2021, the company announced Built Pay to simplify the construction community’s payment-making and receiving process. A year later, it launched Inspection Technology & Services Solutions in November 2022. In April 2013, Built launched a new business unit focused on commercial property developers.
Built – Mission and Vision
Built aims to improve the outcomes for those involved in building and managing the world. The company’s vision is to become one of the most important and trusted partners in the built world.
Built – Business Model
Built’s collaborative construction and real estate finance software streamlines the collateral monitoring and draw management process to reduce construction loan risk, transform borrower experience, increase loan profitability, simplify compliance, and provide portfolio insights.
This platform allows lenders to access real-time data to make more informed construction portfolio-related decisions. Moreover, it provides borrowers with a convenient digital experience with faster access to money to complete construction projects on time.
Built has managed around 200,000+ projects worth $135B construction volume and has protected approximately $24 billion in payments.
Built – Revenue Model
Built earns revenue by providing construction financing solutions for lenders, inspectors, builders, contractors, and subcontractors.
Built provides a construction and real estate finance platform. In addition, the company offers Construction Loan Administration, Project Pro, Inspections Technology and services, and Title Search for construction lending for CRE Management, facilitate Deal Management, Pipeline Management, Portfolio and Asset Management, and Underwriting.
Built – Challenges Faced
In February 2023, Built laid off around 8% of its workforce, and five months later, it underwent another round of employee cuts. The company’s CEO, Chase Gilbert, said in February that downsizing was done due to the rapidly changing business climate.
Built – Funding and Investors
Built has successfully acquired nearly $312.7 million by undertaking seven funding rounds. Its latest funding round – Venture Series Round, was completed on April 13, 2023. The company’s leading investors include Fifth Wall, Citi, Nine Four Ventures, HighSage Ventures, Brookfield Growth, TCV, XYZ Venture Capital, and others.
Date
Round
Number of Investors
Money Raised
Lead Investor
April 13, 2023
Venture Round
1
–
Citi
July 13, 2022
Private Equity Round
–
$23.6 million
–
September 30, 2021
Series D
10
$125 million
TCV
February 4, 2021
Series C
15
$88 million
Addition
April 29, 2019
Series B
6
$31 million
Goldman Sachs Investment Partners
March 28, 2019
Series B
–
$24.1 million
–
November 14, 2017
Series A
3
$21 million
Index Ventures
Built – Mergers and Acquisitions
Built has acquired two companies with Nativ as its recent acquisition. Nativ was acquired on July 29, 2022, and lienwaivers.io on January 21, 2020.
Built – Growth
In 2021, Built secured a $1.5 billion valuation and turned into a unicorn after its new venture funding round. The company’s team headcount doubled in 2021 to 330 employees. Since 2017, Built has more than tripled its customer base. In addition, the company managed a total construction value of over $200 billion for lenders and builders, securing 144% YOY in 2021.
Construction Lending. Built the way it should be.
Built – Partners
Built has secured partnerships with the following companies:
GreenState Credit Union
Fulton Mortgage Company
Encompass
Sage
Black Knight
PandaDoc
Procore
Jack Henry & Associates Inc.
American Bankers Association
Built – Awards and Achievements
Built is recognized by industry leaders with several accolades, some of them are as follows:
Listed as one of the Tennessean’s Top Workplaces in 2022
Won 20th Annual American Business Awards in the ‘FinTech Solution’ and ‘Most Innovative Tech Company of the Year’ categories in 2022
GGV Capital and Crunchbase named Built to Inaugural SMBTech 50 list in 2022
Named a Top Tech Firm in Mortgage Finance by HousingWire in 2018
Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations.
Innovative companies in this modern corporate world are at the cutting edge of how to run a business. Modern businesses seek ways to empower their teams, automate workflows, digitize information, and operate globally. Many companies are shifting to advanced solutions, investing in new paths, and breaking the old ones to do business differently.
Almost everything about businesses has changed, but banks haven’t. Companies, especially early startups, still struggle to get financial support from the banks. So, companies need innovative products to help meet their financial requirements while empowering employees to make better financial decisions to drive the business forward.
Brex, an American company, has built a first-of-its-kind solution integrating the financial services and software companies will need along the way. To learn more about the company, consider going through the article.
Brex is a California-based financial technology company that developed the SaaS-driven credit card and spend management solutions platform. Its unified platform offers corporate cards, expense management, travel, reimbursements, business accounts, and bill pay.
The company serves startups, e-commerce brands, and scaled companies, helping their founders, CFOs, and teams spend smart and move quickly. Y Combinator, Airbnb, Carta, CLSA, Sonoma, ClassPass, and Bounce are some leading customers of Brex.
Brex – Industry
Brex operates in the fintech industry. In 2018, the global fintech market was estimated at 92 billion euros, and in 2024, it’s forecasted to grow to 188 billion euros, with a noteworthy CAGR of 12% from 2018 to 2024. Some essential market growth driving factors include increased penetration of the internet, use of smartphones, and adoption of cashless currency and digital technology during the Covid-19 pandemic. Visa, Mastercard, Stripe, PayPal, Tencent, and Ant Financial are some companies capturing a significant share of the fintech industry.
Fintech sector revenue worldwide in 2017 and 2018, with a forecast until 2024
Brex – Founders and Team
Pedro Franceschi and Henrique Dubugras are the Co-Founders of Brex.
Pedro Franceschi
Pedro Franceschi – Co-founder and Co-CEO, Brex
Pedro Franceschi is the Co-founder and Co-CEO of Brex. He is a Computer Science graduate from Stanford University. He worked as Software Engineer at M4U. Franceschi founded Pagar.me in April 2013, and the company was acquired in September 2016. Currently, he is the Board Member at Coupang.
Henrique Dubugras
Henrique Dubugras – Co-founder and Co-CEO, Brex
Henrique Dubugras is the Co-founder and Co-CEO of Brex. He completed his bachelor’s in Computer Science from Stanford University. He is the ex-founder of EduqueMe and Pagar.me. Currently, Dubugras is the Board Member at Mercado Libre and Expedia Group.
Brex is a team of approximately 1,100 employees.
Brex – Startup Story
Pedro Franceschi and Henrique Dubugras founded Brex on January 3, 2017. It wasn’t first started as a fintech startup but as a VR startup. However, Franceschi and Dubugras pivoted the company three weeks into Y Combinator’s 12-week accelerator program.
When the founders joined the YC W17 batch to start a VR company, they encountered a problem. They applied for business credit to fund software and other expenses, but it was denied. During that time, business credit was traditionally underwritten based on the FICO scores of founders. But since Franceschi and Dubugras were international founders with less than a month of credit history, there was little to no chance for business credit card approval, despite having $125K in the bank.
They discovered it wasn’t just them who faced this problem. While early startup founders could access high-fidelity payment products like Stripe from the get-go, getting access to basic cash management and credit products was a terrible experience for every founder. Cards were particularly a must-have for early startups since large vendors don’t use often accept ACH and other forms of alternative payment from young companies. And therefore, founders used to end up using their personal credit cards for SaaS subscriptions, digital marketing, and filing reimbursements regularly.
To address the extremely low penetration of credit cards in the B2B space, Franceschi and Dubugras pivoted and built Brex. The company’s initial product was a simple 30-day charge card for startups with credit limits based on cash balance. In 2021, the company announced the submission application with the FDIC (Federal Deposit Insurance Corporation) and the UDFI (Utah Department of Financial Institutions) for establishing an industrial bank, “Brex Bank,” Brex’s wholly-owned subsidiary. In the same year, in August 2021, it launched Brex Venture Debt.
Later in April 2022, it launched Brex Empower, a financial software platform, and in June 2022, the company exited the small and midsize businesses market. In March 2023, Brex launched Travel Solution, and in August 2023, it launched Payables.
Brex aims to empower employees anywhere to make better financial decisions.
Brex – Business Model
Brex offers a corporate credit card, cash account, and various software tools to manage expenses, taxes, and bills. It started by explicitly targeting early-stage technology startups needing quick and reliable access to capital. In addition to startups, the company also offers cards to life science, late-stage, e-commerce, and enterprise companies. Currently, Brex shifted its focus from small businesses to larger companies.
Brex analyzes the firm’s financial backing, spending patterns, sales volume, and other data points, along with the applicant’s personal liability, before issuing the business credit card. The company’s card is a charge card that clients must pay off in full every 30 days.
Brex – Revenue Model
Brex generates revenue through a monthly account subscription, referral fees from cashback rewards, interchange fees, interest on loans, and interest on cash held in its customer accounts.
Brex – Products and Services
The product offerings of Brex are as follows:
Corporate Card
Expense Management
Travel
Global
Bill Pay
Startups
Business Account
Venture Debt
Financial Modeling
Integrations
API
Mobile App
Brex Co-CEO: AI Will Completely Transform Fintech
Brex – Challenges Faced
During 2022, Brex was struggling to serve the divergent needs of its small business customers, many of which were limping forward due to the pandemic hit. Franceschi and Dubugras thought they could diversify the company’s revenue and charge customers per head for a new software suite by focusing on large companies.
However, that pivot to SaaS hit some bumps in the road. Brex flubbed telling to its small business clients about shutting down their accounts, which led to social media clangor and a mea culpa from the company’s founders. Even the company faced internal outcry, with employees describing Brex’s ongoing reorganizations as ‘chaotic’ while labeling the future ‘uncertain.’
Moreover, economic headwinds took a toll on the company, with Brex laying off 11% of its employees in 2022.
Brex – Funding and Investors
Brex has undertaken 12 funding rounds and raised a whopping $1.5 billion. Its latest funding round was Series D Round, completed on May 18, 2022. Some prominent investors backing the company include DST Global, Ribbit Capital, Y Combinator, Kleiner Perkins, Lone Pine Capital, Max Levchin, and Peter Thiel.
Date
Round
Number of Investors
Money Raised
Lead Investor
May 18, 2022
Series D
3
–
–
October 22, 2021
Series D
10
$300 million
Greenoaks, TCV
April 26, 2021
Series D
16
$425 million
Tiger Global Management
May 19, 2020
Series C
2
$150 million
DST Global
December 11, 2019
Debt Financing
1
$200 million
Credit Suisse
October 1, 2019
Secondary Market
1
–
–
June 11, 2019
Series C
10
$100 million
Greenoaks, Kleiner Perkins
April 16, 2019
Debt Financing
1
$100 million
Barclays Investment Bank
October 5, 2018
Series C
13
$125 million
DST Global, Greenoaks
June 19, 2018
Series B
17
$50 million
Y Combinator
Brex – Mergers and Acquisitions
Brex acquired 6 companies and these are as follows:
Acquired Company
Announced Date
Pry Financials
April 20, 2022
Weav
August 17, 2021
Neji
March 24, 2020
Landria
March 24, 2020
Compose Labs
March 24, 2020
Elph Network
March 20, 2019
Brex – Growth
Brex’s customer base increased from 100 to 1,000 within five months of launching, and in 2020, it had 20,000 customers. In 2019, the company was valued at $2.6 billion. And after completing its Series D-2 funding round last fall, Brex was valued at $12.3 billion in 2022. Moreover, in May 2023, it announced significant growth with $100M of ARR.
Brex – Marketing Strategies
Brex’s initial marketing strategy was all about focusing on friends and family that were founders of finance individuals at small firms and used to ask them to test their products. After some time, the company harnessed the marketing power of billboards, scraped LinkedIn for potential leads, and hosted events with superior-quality speakers to spread the word.
In May 2021, Brex launched an integrated marketing campaign named “All-in-One” that focused on a ‘less is more‘ approach to promote its All-in-One finance solutions.
Brex – Partners
Brex has partnered with the following listed affiliate, accountant, broker & lender, and VC investor & accelerator partners:
Named to the TIME100 Most Influential Companies list
Named #2 on the 2023 Top 50 Distributors List of Innovative Companies
Recognized as one of San Francisco Business Times and Silicon Valley Business Journal’s 2019 Best Places to Work
Brex – Competitors
Some of Brex’s main competitors are:
Stripe
Square
Expensify
Paychex
SAP Concur
Navan, Inc
Coupa
Pleo
FAQs
What is Brex about?
Brex is a California-based financial technology company that developed the SaaS-driven credit card and spend management solutions platform. Its unified platform offers corporate cards, expense management, travel, reimbursements, business accounts, and bill pay.
Who are the founders of Brex?
Pedro Franceschi and Henrique Dubugras are the co-founders of Brex.
How does Brex generate revenue?
Brex generates revenue through a monthly account subscription, referral fees from cashback rewards, interchange fees, interest on loans, and interest on cash held in its customer accounts.
Who are the main competitors of Brex?
The main competitors of Brex include Stripe, Square, Expensify, Paychex, SAP Concur, Navan, Inc, Coupa, and Pleo.
Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations.
One-click checkout has emerged as a game-changing technological solution in the world of e-commerce. With this revolutionary solution, online businesses can simplify their checkout process and reduce the likelihood of cart abandonment, resulting in increased sales. Every e-commerce store looks forward to deploying this solution to improve customer experience and ignite conversion rates.
Years ago, Amazon solely had patent rights to a one-click checkout solution. But things changed, and a US-based startup, Bolt Financial Inc., developed its own one-click, lightning-fast checkout software.
Let’s read more about Bolt’s journey, funding, partners, products, growth, competitors, and more.
Bolt Financial Inc. (Bolt) is a financial technology company providing mobile-read checkout software designed for e-commerce sites to incorporate sales analysis, process online payments, and prevent fraud. The software helps retailers strengthen their relationships with shoppers by unlocking lightning-fast, secure, logged-in, one-click checkout.
Headquartered in San Francisco, California, Bolt works in Salt Lake City and Stockholm while serving about 250 merchants and processing nearly $500 million in sales annually. Moreover, around 5.6 million shoppers have signed onto Bolt’s network.
Bolt – Industry
Bolt operates in the fintech industry, the global market size of which was estimated at $110.57 billion in 2020 and is forecasted to grow to $698.49 billion by 2030. The market is projected to grow at a CAGR of 20.3% from 2021 to 2030. Government around the world is supporting fintech tools, platforms, and solutions to increase financial inclusion resulting in industry growth.
Moreover, during the Covid-19 pandemic, the need for digital payment services increased. And the companies like Google Pay and PayPal witnessed a considerable increase in customers and digital transactions. Other key players in the fintech industry are Ant Group, Stripe, Inc., Intuit, Inc., Coinbase, and Adyen Group.
Bolt – Founders and Team
Ryan Breslow and Eric Feldman are the co-founders of Bolt.
Ryan Breslow
Ryan Breslow – Co-founder and Chairman, Bolt
Ryan Breslow is the Co-Founder and Chairman of Bolt. He completed his graduation in Computer Science from Stanford University. Ryan has founded multiple companies, including The Movement, Sites by Hand, Prism, Eco, and Love. Moreover, he invested in Cove PBC, Terzo, Permanent, and Green Carbon.
Eric Feldman
Eric Feldman – Co-founder, Bolt
Eric Feldman co-founded Bolt but left the company in 2017. He graduated with Ryan Breslow from Stanford University in Computer Science. Moreover, Eric invested in different companies, including Gradia Health, SphereOne, Practice, Rocket Academy, and FrontRow.
Bolt Team
Maju Kuruvilla
Maju Kuruvilla is the CEO of Bolt. He is a Computer Engineering graduate from Mangalore University and an MBA from the University of Washington. Before being appointed as Bolt’s CEO, he was the company’s COO. Additionally, Maju worked as VP at Amazon, CTO at Milliman, and Software Engineer at Microsoft and Honeywell.
Tina Fan – Chief Customer Officer
Scott Stockberger – Chief Financial Officer
Bob Buch – Chief Business Officer
Tom Berger – VP of Marketing
Currently, Bolt employs approximately 1,000+ employees.
Bolt – Startup Story
Bolt was founded in 2014 by Ryan Breslow and Eric Feldman. Ryan and his friends at Stanford used to mine Bitcoin out of their dorm rooms, but he dropped out to start Bolt with a fellow student, Eric Feldman. Their main motive was to simplify online checkout for consumers and help independent retailers compete with Amazon, the only company with a patent on one-click checkout until 2017. The startup operated out of Ryan’s dorm room. Bolt started as a Bitcoin wallet company but, after some time, pivoted to e-commerce payments.
In mid-2016, the company officially launched its first merchant with the payment solution. In 2018, it began publicly pitching merchants on its fraud protection solution. Bolt launched an Amazon-like checkout in 2019. A year later, in 2020, it launched the ‘Retailers Give Back’ Index. In 2021, Bolt launched the Single Store Account and Payment for e-commerce merchants. The company introduced Virtual Shopper Assistant in October 2022.
The company’s mission is to democratize commerce. Its vision is to set new standards for e-commerce.
Bolt – Business Model
Bolt is a mobile-read checkout software that handles online payments for e-commerce retailers, offers fraud protection, and allows customers to buy products with a single click. This one-click checkout software could be plugged into the existing payment platform of any business to convert more shoppers into buyers. The software allows customers to login into e-commerce sites without a password and instantly checkout.
Moreover, Bolt is fully equipped to support messages, gifts, gift cards, redeem discounts, and easily handle shipping. The company claims that Bolt’s integrated functions can help businesses cut their checkout times from more than one minute to 30 seconds.
Bolt – Products and Services
The product offerings of Bolt include the following:
The Bolt Network
One Click Checkout
Account Creation
Fraud Protection
Bolt SSO
Goodbye, Guest Checkout
Bolt Payments
Merchant Analytics
Product Releases
Checkout Everywhere
Bolt – Challenges Faced
It’s been reported that Bolt often overstated its technological capability and misrepresented the number of merchants using its services in a rush to show growth. Moreover, in the investors’ presentations, the company listed customers before verifying whether those merchants were able to use its technology. In November 2021, one of the company’s biggest customers, Authentic Brands Group, sued it for failing to deliver the technological capabilities it held out as processing.
Even in January 2022, Ryan Breslow abruptly stepped down as chief executive, blindsiding some investors who had invested money into Bolt weeks earlier. Some investors were looking to sell their stakes with customers questioning the company’s technology. In April 2022, Bolt announced a three-month hiring freeze in the staff meeting.
Bolt – Funding and Investors
Bolt has raised $972.1 million over 10 funding rounds. Its latest funding round – Secondary Market Round, was conducted on January 19, 2022. General Atlantic, Westcap, Axevil Capital, Schonfeld Strategic Advisors, and Activant Capital are some leading investors funding the company.
Date
Round
Number of Investors
Money Raised
Lead Investor
January 19, 2022
Secondary Market
1
–
–
January 14, 2022
Series E
9
$355 million
–
October 12, 2021
Series D
11
$393 million
–
December 21, 2020
Series C
5
$75 million
General Atlantic, Westcap
June 16, 2020
Series C
7
$50 million
Westcap
July 9, 2019
Series B
23
$68 million
Activant Capital, Tribe Capital
July 1, 2018
Series B
35
$22 million
Activant Capital
October 26, 2016
Series A
3
$9 million
Long Venture Partners
July 29, 2015
Seed Round
3
CN¥500K
–
January 1, 2014
Seed Round
1
–
RRE Ventures
Bolt – Mergers and Acquisitions
Bolt acquired Tipser on November 24, 2021.
Bolt – Growth
The post-money valuation of Bolt is discussed below:
Year
Valuation
2022
$11 billion
2021
$4 billion
2019
$357 million
2018
$250 million
Its revenue in 2021 was roughly $30 million, and it made $7.2 million in Q1 of 2022. From 10 employees in 2018, the company’s team size has grown to 800 in 2022.
Bolt – Partners
Bolt has collaborated with the following e-commerce platforms, agencies, and solution integrators:
During the journey, Bolt has built an award-winning culture and workplace, with the company being recognized by industry leaders. It is honored by the following listed awards:
Forbes 2019 Fintech50
Fintech 250 by CB Insights
2020 Inc. Best Workplaces
Entrepreneur 360 Bolt
Fortune Best Workplaces in the Bay Area 2020
Great Places to Work (Certified APR 2021 – APR 2022 USA)
Bolt Financial Inc. (Bolt) is a financial technology company providing mobile-read checkout software designed for e-commerce sites to incorporate sales analysis, process online payments, and prevent fraud.
Who are the founders of Bolt Financial Inc.?
Ryan Breslow and Eric Feldman are the co-founders of Bolt.
Who is the CEO of Bolt Financial Inc.?
Maju Kuruvilla is the CEO of Bolt.
Who are the main competitors of Bolt Financial Inc.?
The main competitors of Bolt Financial Inc. include PayPal, Stripe Connect, Signifyd, Apple Pay, Amazon Pay, and Checkout.com.
Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by the organization it is based on.
Governments across the world are supporting the use of fintech for increasing financial inclusion and elevating efficiency via real-time payments and open applications programming interfaces and blockchains. Leveraging the fintech industry, the government can create a digital economy that further leads to market growth.
Acorns is the first company in the fintech industry to offer micro-investments and robo advice to the world. Read further to access detailed information about Acorns- from founders and startup story to the business model, investors, growth, and funding.
Acorns – Company Highlights
Company Name
Acorns
Headquarters
Irvine, California, United States
Primary Industry
Fintech
Founders
Jason Martell, Jeff Cruttenden, Walter Cruttenden, and Mark Dru
Founded in 2012, Acorns is a finance company that provides micro-investing services through its web and mobile applications. It basically allows its customers to round up purchases and invest the change automatically into a diversified portfolio. Moreover, the company also offers multiple solutions, including banking, personal investing, investing for kids, and investing for retirement.
The company is thriving under the leadership of Noah Kerner (CEO) and David Hijirida (President).
Acorns – Industry
Acorns is a fintech company that has revolutionized the concept of micro-investing worldwide. Fintech is the term used to refer to financial technology that enhances or automates financial services and processes.
Talking about the global fintech market, it has attained a value of over $194.1 billion in 2022 and is expected to reach more than $492.81 billion by 2028, with a CAGR of 16.8% during 2023-2028.
It is because of the increased penetration of the internet, use of smartphones, and adoption of cashless currency and the Covid-19 pandemic that accelerated the adoption of digital technology in the financial sector.
Visa, Mastercard, PayPal, Tencent, Stripe, and Ant Financial are a few leading companies in the fintech industry.
Acorns was founded by four seasonal entrepreneurs named Jason Martell, Jeff Cruttenden, Walter Cruttenden, and Mark Dru. The team was later on joined by Noah Kerner.
Jeffrey James Cruttenden
Jeff Cruttenden – Co-founder of Acorns
Jeffrey James Cruttenden is the founder of Acorns and graduated from Lewis & Clark College with a degree in Bachelor of Arts, in Mathematics. In addition to this, he is currently a Partner at Cruttenden Partners and Co-founder at Say.
Walter Cruttenden
Walter Cruttenden – Co-founder of Acorns
Working as a Founder at Acorns, Walter Wemple Cruttenden III has held the role of CEO at Blast. Presently, he is also working as a President at Cruttenden Partners and Executive Director at Binary Research Institute.
Jason Martell
Jason Martell – Co-founder of Acorns
Jason Martell is an entrepreneur known for co-founding many companies. His expertise lies in the field of UX design, UI, mobile, creative, and interactive technologies. Jason Martell currently serves as a product designer for Meta. He also served as the co-founder of Blast and Acorns.
Mark Dru
Mark Dru – Co-founder of Acorns
Mark Dru is another name in the founder’s list of Acorns. Apart from Acorns, he is also the co-founder of Blast and has worked as Chief Revenue Officer at Triller in past. At Acorns, along with being a co-founder, he has served as a CFO for time period of 3 years (2012-2015).
Noah Kerner
Noah Kerner – CEO and Chairman at Acorns
Noah Kerner is another powerful name in the team of Acorns. He serves the Acorns as CEO and Chairman from 2014 to the present. Apart from this, he has also served as the co-founder and CEO of Noise. He is also present as a co-founder of SAY.
When it comes to the company size, presently, it employs around 500 employees.
Acorns – Startup Story
The main idea behind founding Acorns was to promote incremental and passive investing. In 2014, it launched an app for both Android and iOS devices, and portfolio options were designed in partnership with Harry Markowitz – a Nobel-winning advisor.
Moreover, the platform has expanded by including checking account services and retirement IRA products. In 2018, a behavioral economist- Shlomo Benartzi was appointed Chair of the Behavioral Economics Committee to work on the initiative of Money Lab conducting field experiments to know stats about consumer spending.
Acorns – Mission and Vision
Acorns Mission
The company’s main aim is to look after the financial best interests of the up-and-coming, beginning with the empowering, proud step of micro-investing. It is working on increasing the accessibility to several investment options that were previously available for purchase only with a large sum of money.
Acorns – Business Model
The micro-investing platform earns money through membership fees. It basically allows members to save small sums of money and invest them to further save for retirement. The company also offers banking services to members at lower fees.
The services are divided into three primary categories. The first category allows members to invest their spare change in ETFs (exchange-traded funds). The second category enables members to create and fund an IRA through the platform and the third category provides a debit card through companies like Visa Inc.
The subscription is offered by the company for $1, $3, and $5 per month for packages including different services.
Acorns – Products and Services
Acorns Website
Acorns is known to offer four main products and these are – investment management, investment portfolios, stock trading and stock portfolios. In addition, it has three main services- Acorns Core, Acorns Spend, and Acorns Later.
Acorns – Challenges Faced
Acorns failed to maintain proper customer records and thus, was censured and fined by Financial Industry Regulatory Authority in 2017. Furthermore, in 2021, the company planned to go public after merging with Pinoeer Merger Corporation – a blank-check company.
However, this plan was canceled in 2022 due to market conditions. Moreover, no tax strategy and high fees on small balances are two major aspects where it falls short.
Acorns – Funding and Investors
Over 10 funding rounds, Acorns has been able to raise a total of $507 million. Furthermore, the company’s latest funding round – Series F Round was undertaken on March 9, 2022, in which it raised a total of $300 million.
It is backed by 39 world-class investors, advisors, and board members, including 2 Nobel Prize-winning economists. Some of its main investors are PayPal, BlackRock, Bain Capital Ventures, DST Global, NBCUniversal, Comcast Ventures, Greycroft, Capital Group, Headline, and TPG.
Date
Round
Number of Investors
Money Raised
Lead Investor
March 9, 2022
Series F
11
$300 million
TPG
August 19, 2019
Venture Round
6
–
–
January 28, 2019
Series E
10
$105 million
Comcast Ventures, NBCUniversal
January 12, 2018
Venture Round
1
–
The Rise Fund
July 20, 2017
Series D
7
$35 million
–
April 21, 2016
Series D
8
$35 million
PayPal Ventures
February 15, 2015
Series C
8
$23 million
Greycroft, Headline
March 12, 2014
Series B
3
$6.2 million
Jacobs Asset Management
October 1, 2013
Series A
1
$2.5 million
Steelpoint Capital Partners
June 1, 2012
Pre Seed Round
1
$300K
Cruttenden Partners
Acorns – Mergers and Acquisitions
Acorns have acquired 3 organizations and these are Vault, Harvest Platform, and Pillar.
Acquired Company Name
Date of Announcement
Price
Pillar
April 7, 2021
–
Harvest Platform
March 12, 2021
–
Vault
November 7, 2021
–
Acorns – Patents and Trademarks
As per IPqwery, the intellectual property of the company currently has 20 registered patents, primarily in the category of ‘Computing’ and ‘calculating’. Furthermore, it has 28 registered trademarks categorized into the ‘Scientific and electric apparatus and instruments’ class.
Acorns – Partners
Presently, Acorns have a total of 26 partners in its portfolio. Some of the reputed names from the portfolio are Airbnb, ABC, Trust & Will, ZipRecruiter, BlackRock, Clarity Money, NBKC, and PayPal.
Acorns – Growth
As per Fortune’s Impact 20 list 2020, its customer count increased to 8.2 million. Additionally, it has over 4.6 million paid subscribers. With the company’s annual revenue is to be estimated at $84 million per year ($165,100 per employee) in 2022, Acorn’s current valuation stands at $2 billion. Moreover, its employee count increased by 25% last year.
The company has over 24,000 monthly app downloads, with Acorns: Invest Spare Change, Acorns: Save & Invest, and Acorns Stickers as the most popular apps.
Acorns – Competitors
More and more companies are establishing businesses in the Fintech industry to provide high-quality financial services which increases competition to a great extent. Some main competitors of Acorns are:
Acorns is an American financial technology company founded by four entrepreneurs named Jason Martell, Jeff Cruttenden, Walter Cruttenden, and Mark Dru.
Are Acorns safe to invest in?
Yes, Acorns is a safe platform to invest in because it complies with all the federal law rules related to digital safeguarding and bank-level physical security.
What is the best investing app for beginners?
Some of the best investing apps for beginners are Robinhood, stockpile, Acorns, etc.
Is Acorns a cryptocurrency?
No, Acorns is not a cryptocurrency instead it is an American financial technology and financial services providing company.
Fintech or financial technology in the last decade has been one of the world’s most promising sectors. FinTech has changed the way finances are conducted with mobile banking, investing, and blockchain apps. According to the Modern Knowledge World, the centerpiece of this technology trend is the United States where 1,491 startups and $58,5 billion invested in the sector.
Yet banks are not the only financial institutions that have changed technologies. Digital financial access is embedded in entire markets, including digital loans and mobile stock systems, e-commerce payment networks, and digital currency exchanges.
In this article, we will talk about some of the top Fintech startups in the USA. So, let’s get started.
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Fintech means Finance + Technology which refers to the amalgamation of both into software that seeks to improve and automate the delivery and use of financial services. Fintech defines any business offering financial services through software or other technologies, from smartphones to cryptocurrency payment applications.
Fintech firms have changed nearly every part of the finance sector in recent years. Ten years earlier, individuals had to visit a branch or bank to apply for a deposit, a credit or to transfer funds literally from one bank to another. At present, Fintech has made it possible, without having to ever step into a bank to spend, borrow, save, and move funds through online and mobile services. Although conventional institutions are picking up technologies from fintech steadily.
Evolution of Fintech in the USA
Fintech was even longer than most people believe. Though Fintech’s current version helps you to pay for a coffee cup with a smartphone app, financial infrastructure history goes back to the first credit cards accepted by the public at the end of the 1950s.
Financial technologies developed and implemented many significant milestones in the mass market after the credit card, such as ATMs, Electronic Shares, Mainframe Bank computers, and internet stock investment. Many modern technologies improved the financial system that most people used, but had to think seldom about every day.
Today, solutions from the Fintech industry challenge existing banking infrastructure, for example by using a payment app on the mobile wallet, rather than the carriage of physical credit cards in a physical wallet.
Fintech’s various markets have been revolutionized, particularly in the financial, commercial, insurance, and risk management industries. Fintech firms include startups, technology companies, and existing financial institutions leveraging digital innovations such as big data and artificial intelligence to enhance financial services usability and performance, blockchain, and edge computing.
List of Top Fintech Startups in the USA
Stripe
Founder – Patrick and John Collison
Founded – 2010
Stripe Logo | Top Fintech Startup in the USA
Stripe is an Irish-American financial service and SaaS company founded by Patrick and John Collison. Stripe provides payment infrastructure for businesses of all sizes from startups to large enterprises that use Stripe’s software, and APIs to accept payments, send payouts, and manage their businesses online.
Zoom, Shopify, and Amazon are some of their clients. Stripe claims to be the world’s most powerful and end-to-end API. In 2019, Stripe launched a new corporate credit card and small business loans, which are automatically repaid from payments it processes for borrowers.
Chime
Founder – Chris Britt
Founded – 2012
Chime Logo | Top Fintech Startup in the USA
An increasing crowd of startups bets on your smartphone for banking. Chime, headquartered in San Francisco, has experienced its sales explosion over the past year and provides a debit card with no annual or overdraft charge. According to a person familiar with the topic, it is set to hit almost $200 million in 2019, a fourfold increase over 2018. With many significant tactics, Chime has drawn 5 million clients – or about 3.3 million users, based on an annual average of 1.5 accounts per client. Chime allows you to pay for a direct deposit to control the main functionality.
Plaid
Founder – Zach Perret and William Hockey
Founded – 2013
Plaid Logo | Top Fintech Startup in the USA
Plaid was founded by Zach Perret and William Hockey. Plaid provides a simple front-end module that streamlines the onboarding experience. It can be implemented with 2-3 lines of coding. Plaid connects payment apps like Square Cash and personal finance apps like Acorns to users’ bank accounts to transfer and track funds. American Express, Venmo, Coinbase, and Betterment are some of their clients.
SoFi
Founder – Mike Cagney and Dan Macklin
Founded – 2011
SoFi Logo | Top Fintech Startup in the USA
SoFi began out as a small business with just one commodity by launching a fintech service mainly for refinancing student loans. The organization sells several items today, but refinancing student loans remains its flagship commodity. SoFi is a value-driven organization with a task to help our members earn a living. We develop new financial goods and services that can enable customers to borrow, save, buy, save and safeguard their cash more, gain financial freedom, and meet their ambitions—from homeownership to pension plans, to paying student loans, and more.
Coinbase
Founder – Brian Armstrong and Fred Ehrsam
Founded – 2012
Coinbase Logo | Top Fintech Startup in the USA
CoinBase has become a regular on-ramp for new crypto-investors as the leading mainstream cryptocurrency exchange in the United States. Coinbase provides a broad range of items, including cryptocurrency investment, an integrated trade network, institutional custody accounts, a retail investment wallet, and a secure U.S. dollar coin. Coinbase has taken the lead in offering crypto custody services to organizations since having developed its position as a stable and regulatory crypto-exchange and a personal wallet and new currencies tailored to cater to those wanting more anonymity. The company has become a pioneer in the crypto industry.
Ripple
Founder – Arthur Britto, Jed McCaleb and Chris Larsen
Founded – 2012
Ripple Logo | Top Fintech Startup in the USA
Ripple is both a peer-to-peer (RippleNet) and a digital currency transferrer (ripple XRP). The platform itself is a protocol for open-source transactions between two parties. All currencies, such as sterling currencies, bitcoins, and air miles, among others, can be traded on the site. In 2019, XRP sold $500 million to MoneyGram, using sales to raise and invest up to $50 million, currently using XRP in 10% of its Mexico purchases across borders.
Toast, Inc
Founder – Steve Fredette, Aman Narang and Jon Grimm
Founded – 2012
Toast, Inc. Logo | Top Fintech Startup in the USA
Toast, Inc. is a Boston, Massachusetts-based cloud restaurant tech firm. Toast, Inc. was one of the leading technology names when the calendar was turned towards 2020. In the secondary markets, shareholdings of the private enterprise that produces restaurant apps were in strong demand. In mid-February, current investors contributed about $5 trillion in investment, almost double the previous year.
Spur
Founder – Glenn Clayton
Founded – 2017
Spur Logo | Top Fintech Startup in the USA
Spur simplifies human capital by leveraging a digital interface to provide embedded financial services on an hourly basis for its staff. Your business plan saves time and resources and allows staff to improve their financial status. Spur was developed by companies who want to take up the responsibility of job management less time and more time for their enterprises, their clients, and their hourly employees.
Credit Karma
Founder – Kenneth Lin
Founded – 2007
Credit Karma Logo | Top Fintech Startup in the USA
Credit Karma is known best for its free credit and loan reports. It is however a platform that provides its customers with the ability to create a stronger financial future. If you wish to use Credit Karma you should give your name and the last four digits of your Social Security number. You should have simple personal information. Credit Karma can then view your loan report, and collect and make it available to you with your consent. For users who utilize credit card reviews, personal, home-and-auto loans, or auto insurance, Credit Karma earns a big reference fee.
Opendoor
Founder – Eric Wu, In Wong and Keith Rabois
Founded – 2014
Opendoor Logo | Top Fintech Startup in the USA
Home sellers in 21 cities can submit all-cash deals online from Opendoor and collect offers within 24 hours. The application initiated last year helps customers to arrange their own guided tours and deliver houses to sell in six cities, Dallas and Phoenix included. You only present details and pictures of your home through their website to sell your home with Opendoor. All these advantages Opendoor especially apply to veterans, openings, relocators, or people who have to sell their homes quickly. Opendoor also appreciates the ease of online and straightforward deals and costs for the youngest generation.
Root
Founder – Alex Timm and Dan Manges
Founded – 2015
Root Logo | Top Fintech Startup in the USA
Founded by Alex Timm and Dan Manges, Root raised $100 Billion for a $1 Billion valuation in 2018 and entered the unicorn club. Root provides car insurance to drivers. Root qualifies customers and sets their rates by first monitoring their driving with a smartphone app measuring 200 variables. After monitoring they provide a quote and allow their customers to change policy. Last year, Root brought claims processing in-house and expanded into renters’ insurance, offering to cover property whether stolen from a customer’s car, apartment, or hotel room.
Paydiant
Founder – Kevin Laracey, Chris Gardner and Joe Paratore
Founded – 2010
Paydiant Logo | Top Fintech Startup in the USA
Paydiant, Inc. is a PayPal-owned financial technology agency. It offers cloud-based services for supermarkets, insurers, point of sale, and ATM vendors. The enterprise is located in Auburndale, Massachusetts, and was founded in 2010. The North Bridge Investment Partners and General Catalyst Partners funded Paydiant for $ 7.6 million in 2011. In 2012 and 2013 Paydiant earned $12 million and $15 million in grants.
Kraken
Founder – Jesse Powell
Founded – 2011
Kraken Logo | Top Fintech Startup in the USA
Kraken was founded by Jesse Powell in the year 2011. This US fintech startup deals with the trading of cryptocurrency. It is a big marketplace where buyers, sellers and traders gather together for exchanging all kinds of digital assets. The platform has over 9 million customers from over 190 countries. The headquarters of the company is situated in California, The United States of America. Kraken also has released an app for its international customers in 2021.
Robinhood
Founder – Vladimir Tenev and Baiju Bhatt
Founded – 2013
Robinhood Logo | Top Fintech Startup in the USA
Robinhood is a fintech company that provides an online platform where you can invest and trade without giving any commissions. The company was founded by Vladimir Tenev and Baiju Bhatt in the year 2013. The company’s aim is to make investing familiar and easy for everyone. The headquarters of the company is situated in California, The United States of America.
Brex
Founder – Henrique Duburgras and Pedro Franceschi
Founded – 2017
Brex Logo | Top Fintech Startup in the USA
This fintech company mainly deals with technology companies and provides them with business credit cards and accounts for cash management. The company was founded in the year 2017 by Henrique Duburgras and Pedro Franceschi. The company also offers financial management tools to the business of its customers. The headquarters of the company is situated in California, the United States of America.
Conclusion
During the COVID–19 pandemic, particularly in emerging markets, the Fintech industry continued to help expand access to financial services with strong growth in digital financial services of all kinds. For poverty reduction and economic development, access to quality financial resources is important. The access and use of basic financial resources for poor people, in particular women, will increase wealth, strengthen resilience, and better their lives. Fintech developments aim to lower the costs of service supply, enable more customers to be served and reduce the need for face-to-face contact, critical to the pandemic’s continued economic activity.
FAQs
How does technology help finance?
The impact of technology on financial services allows the customer to avail of easy digital transactions.
How does technology affect the financial industry?
The arrival of smart analytics helps the financial industry to understand its customer better and provide services accordingly.
What are the new financial technologies?
Blockchain, Robotics, Artificial Intelligence, Cryptocurrency, and many more.
Is Chime a legit company?
Yes as they’re FDIC insured, so it’s a safe place to keep your money.
What are the top Fintech companies?
Square, PayPal, Goldman Sachs, Green Dot, MercadoLibre, and many more.
Do FinTech companies pay well?
Yes, the USA is the top earner making $169,000 annually.
Is Fintech a good career?
Fintech would be considered a good career opportunity for people who are seeking to build their career in the field of finance domain.
Which is the largest Fintech company in the world?
Ant Financial.
How do banks use Fintech?
Banks are using fintech technology in the form of mobile banking apps.
What are Fintech tools?
Artificial Intelligence, machine learning, mobile computing, and more enable borrowers to access funding.
Prithvi Durai
