One area that has not slowed down during the global pandemic is investment deals in the fintech market. This week, Greenlight took in $215 million in a series C funding that pushed its valuation over $1 billion. Atlanta-based Greenlight Financial Technology provides a debit card and mobile app to help children learn how to save and successfully spend money.
Here’s what Crunchbase had to say about the investment and what drove the valuation:
The fintech company secured a $1.2 billion valuation after closing on $215 million in Series C funding led by Canapi Ventures and TTV Capital with participation from new investors BOND, DST Global, Goodwater Capital, Fin VC and Relay Ventures. The new investment gives Greenlight approximately $297 million in total funds raised since the company was founded in 2014, according to Crunchbase data.
The app is $5 per month and includes parent-managed, fee-free debit cards for up to five children, Tim Sheehan, co-founder and CEO of Greenlight, told Crunchbase News. Parents and children can work together to manage chores, allowances and spend controls. In addition, there are educational components on earning, saving, spending and giving
Much of the growth was driven by the COVID-19 pandemic, which put money into focus for parents who want their children to form healthy financial habits. That growth attracted investors and led to the larger raise, Sheehan added.
Perhaps Greenlight, by starting with younger generations, will reduce the population of unbanked individuals in the future.
Greenlight will use its new pool of money to expand services including teaching kids about investing, which might be good for the whole family. Another excerpt from the article explains:
“We have discovered a whole new category called ‘family finance’ that has unmet or poorly met needs,” he [Tim Sheehan, co-founder and CEO of Greenlight] said. “We want children to start to manage their own money and learn to make decisions. When it is their money, they are more thoughtful about their purchases.”
Meanwhile, Greenlight will begin rolling out its investment product in the fourth quarter, add more value to the product, and continue helping parents navigate this challenging duty.
Overview by Sarah Grotta, Director, Debit and Alternative Products Advisory Service at Mercator Advisory Group