FinTech News
Neobank Current Reveals $200 Million in New Capital
A popular neobank has announced an injection of new capital as it nears profitability.
About the funding and more:
Current has reported receiving $200 million in fresh capital. These funds came from existing investors Andreessen Horowitz, Wellington Management, and Avenir. New investors General Catalyst and Cross River Bank also participated. Prior to this, Current had raised a total of $402.4 million, including a $220 million Series D in 2021 (led by Andreessen Horowitz). With the funding, the neobank says it plans to invest in new product expansion as well as strengthen its current products.
Speaking more specifically about the roles of new investors, Current noted that General Catalyst’s participation will help with strategic member acquisition and support efficient expansion. Additionally, Cross River (and FDIC-insured partner bank of Current’s) has extended warehouse funding that will assist the banking app’s Paycheck Advance and secured credit-building card features.
News of the capital came as Current announced a record year, which brought them a 90% increase in revenue. According to the company, this now puts them on track to achieve profitability in 2025.
What they’re saying:
Commenting on Current’s mission and trajectory, the company’s CEO and co-founder Stuart Sopp said, “Millions of Americans are struggling with affordable access to liquidity and credit. Our record, market-leading growth is a testament to Current’s unique ability to build solutions that work together synergistically to solve these needs and are available to everyone.”
Regarding the latest funding, Sopp noted, “This new capital provides us the most efficient way to scale these solutions, including providing even higher limits of our earned wage access product to more people and setting our company on the best path to long-term success, including reaching profitability in 2025.”
Additionally, Roy Mabrey of General Catalyst said of the firm’s investment, “Current’s tremendous growth this year showcases the true product-market fit it has unlocked. We are excited to invest in the future of Current because of its demonstrated ability to scale with great unit economics and the key gap it is stepping up to fill in the market for millions of Americans who are struggling to make ends meet.”
My thoughts:
Even though I’ve been a fan of Current overall, it has felt as though their product has been a bit stale lately (basically ever since they effectively ruined their Savings Pod product by severely lowering the APY you could earn without utilizing direct deposit). Given this experience, I’m hopeful that these new funds can be put to good use and keep the neobank growing. To be clear, reaching profitability would be a big step as many startups never end up making it to that point — which is also why so many shut down when the venture capital runs out.
As we head into 2025, I’ll definitely be keeping a closer eye on Current to see what they have up their sleeves (besides $200 million in capital).
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