FinTech News
Vehicle-Secured Credit Card Company Yendo Raises $165 Million
A FinTech that offers the first-ever credit card secured by a customer’s vehicle has announced its latest round of funding.
About the round:
This week, Yendo announced that it had raised $165 million. However, this includes $150 million in debt financing and $15 million in equity. The debt portion was led by i80 group, while the strategic investors that participated in the equity round were not disclosed. Yendo previously raised a $24 million Series A last year in a round led by FPV Ventures. Including debt financing, the startup has now raised a total of $257.5 million, while its equity funding totals $47.5 million.
With this new funding, Yendo says it will be able to fuel customer growth — including expanding to all 50 states — and launch new products. Additionally, the company states that it will fund the growth of originations on its platform.
About Yendo:
Using Yendo, consumers can access up to $10,000 in revolving credit that’s secured by the value of their vehicle. To open an account, users can first gain pre-approval online. Then, after their identity and the condition of their car are confirmed, they’ll need to send their title to Yendo.
Alternatively, for those who don’t yet own their vehicle outright, they can refinance through Yendo. Then, as customers pay down their loan balance, their credit card limit will increase. Additionally, the company reports that many customers who choose this option enjoy lower monthly payments as well.
According to Yendo, customers have now saved a combined total of more than $50 million in interest as a result of the service. The platform is currently available in 40 states.
What they’re saying:
Announcing the new round of funding, Yendo CEO and founder Jordan Miller said, “We’ve proven there’s a need for a product like Yendo in the market and this round of debt financing from i80 Group will enable us to expand access to affordable credit to more Americans in more geographies.”
Looking ahead, Miller added, “We have an aggressive roadmap for 2024 and this credit facility will allow us to deliver on our mission and focus on what matters most – delivering the best products and experiences to our customers.”
Elsewhere, i80 Group managing director Peter Frank said of the firm’s investment, “We’re thrilled to partner with Yendo, they are addressing an overlooked segment of consumer credit with an innovative product that allows underserved borrowers improved access to affordable credit through their vehicle. Jordan and the Yendo team have developed a unique offering that creates a win–win, we’re excited to partner with them to scale it.”
My thoughts:
The last time that Yendo raised money, I stated that, while their auto-secured credit card was an interesting idea, I wasn’t sure it was a good one. Well, nearly a year later, I still feel about the same way — although, once again, I do see it as a potentially positive alternative to more traditional auto-title loans.
As for the funding the company is seeing, it is interesting to me that 1) the equity portion is smaller than their Series A and 2) they’re not disclosing the firms participating in that part of the round. I don’t know enough to know exactly why that would be, but it strikes me as odd. In any case, even if this round is 90% debt financing, that amount of money should still help propel Yendo’s unique product to another level.
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Other Articles by Kyle Burbank
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