On-Demand Worker Pay FinTech Clair Raises $175 Million
A FinTech that helps workers receive their pay in a more timely manner has raised a new round of funding.
About the round:
Clair has announced that it’s raised a total of $175 million. This round includes $25 million in equity as well as a $150 million debt facility. As for the equity portion, it was led by returning investor Thrive Capital with participation from Upfront Ventures and Kairos. Additionally, as part of the deal, Kairos Investing Partner Michael Presser has been appointed as a board observer. To date, Clair has now raised $45 million in venture capital funding, including a $15 million Series A in 2021, which was also led by Thrive.
Describing itself as a “mission-driven FinTech,” Clair is looking to replace traditional payday loans by providing workers with on-demand pay. Through a partnership with Pathway, the startup now offers FDIC-insured Clair Spending and Savings Accounts. With these accounts, employees can access up to 50% of their gross earnings before payday.
Currently, Clair works with more than 20,000 businesses. These include payroll and scheduling companies as well as brands. For example, some current partners using the service include DoubleTree by Hilton, Sheraton Hotels & Resorts, and GNC. In total, Clair says that these partnerships mean that they can help more than 50,000 workers.
What they’re saying:
Explaining the inspiration and need for Clair, the company’s co-founder and CEO Nico Simko said, “Front-line workers are astonishingly underserved, as big banks don’t see them as profit drivers and aren’t building the solutions they need. This lack of support is unfair when half of Americans live paycheck to paycheck and don’t have $500 in savings for an emergency, so timely pay is crucial for them to keep up with their bills.” Additionally, commenting on the new funding round, Simko noted, “We’re grateful to join forces with investors, partners and employers who believe in our mission of enabling people to responsibly customize their pay cycles to their needs.”
Meanwhile, Thrive Capital Partner and Clair board member Kareem Zaki (who joined the board as part of Thrive’s participation in Clair’s Series A round) said of the FinTech, “Clair’s product has enabled both workers and employers to adapt in a uniquely challenging labor and economic environment. In addition to their exponential growth this past year, we’ve been pleased to see that Clair has consistently prioritized compliance and delivering tangible value to their customers.”
Considering that Thrive Capital has previously invested in the likes of Plaid, Robinhood, and Lemonade among others, having the firm lead not one but two venture rounds seems to be quite an endorsement. Add in the fact that Clair is addressing a major worker issue at at time of near full employment and it’s not hard to imagine that that company is set up for success. Thus, if all goes right, expect to see Clair’s profile rising as it continues to expand its reach, fueled by these new funds.