US Digital Bank Current, Triples Valuation, Becomes Unicorn

April 27, 2021
Connor Cassidy

There’s a new fintech unicorn in town and it’s in the United States. The American-based challenger bank Current, which has seen amazing growth trends reaching three million users, announced this morning that they had raised US $220 million in a Series D funding round that was led by new investor Andreessen Horowitz. This comes on the heels of Current’s $131 million Series C funding round at the end of last year, at which point the company had doubled its user base over just six months to over 2 million users. The results of these new funding rounds mean that the fintech company has almost rippled its valuation in five months to US 2.2 billion!

Other investors included TQ Ventures, Avenir, Sapphire Ventures, Foundation Capital, Wellington Management and EXPA. David George, who led the round with a16z, will become a Current board member, as well as the accredited Tiger Global Management group.

The unicorn began its life as a teen debit card that gave parents ultimate control over their child’s spending but later expanded their offering to personal checking account run by the same underlying banking technology. What Current has in common with other digital banks or “neobanks” is that they provide the standard features including free overdrafts, no minimum balance requirements, faster direct deposits, instant spending notifications, banking insights, free ATMs, check deposits using your phone’s camera and more. To try to differentiate itself Current launched last year a points reward program and became one of the first banks to transfer the first round of the stimulus payments from the Trump administration, which brought a lot of great publicity.

Current is also trying to connect with the technologically savvy Gen-Zer’s by partnering with YouTube sensation MrBeast (aka Jimmy Donaldson), who said last week on his YouTube channel that he will personally send $1 to every 100,000 people who sign up using his Creator code. MrBeast is also an investor.

Current still offers its Teen banking features, in a challenge to mobile banking app Step, which also is using social media influencers to gain clout in the space. Unlike Current, Step is appealing to 13–18-year old’s while Current is appealing to parents. The company’s ultimate goal is to one day primarily focus on the over 30 million Americans who live paycheck to paycheck.

The company also added that the US $220 million in new funds will be used to grown the company and its member base as it continues to offer better and competitive banking products. One key area is the space of cryptocurrency.

“This new generation of customers doesn’t want to bank in physical branches,” said a16z’s David George, in a statement. “We believe there will be a shift in the next 10 years to mobile and consumer-focused banking services powered by innovation in technology, and with Current’s exceptional growth over the past year, they’ve clearly demonstrated they’re at the forefront of this trend. Their product is among the best in the market, and they have proven an ability to reach customers who previously were unserved or underserved by traditional banks,” he said.

Reference:

Perez, Sarah. “TechCrunch Is Now a Part of Verizon Media.” Tech Crunch, 27 Apr. 2021, techcrunch.com/2021/04/27/mobile-bank-current-raises-220-million-series-d-triples-valuation-to-2-2b.

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