Upgrade Announces $105 Million Round at $3.3 Billion Valuation
Another FinTech megadeal is in the books as Upgrade has just announced that it raised $105 million in its latest investment round. The Series E was led by Koch Disruptive Technologies (KDT) with BRV and Ventura Capital also participating. To date, Upgrade has raised a total of $307 million, including a $40 million Series D led by Mouro Capital last year. This latest raise valued the company at $3.325 billion.
Co-founded by former LendingClub CEO Renaud Laplanche, Upgrade offers a variety of financial products, from personal loans to a unique line of credit card. For example, the company’s flagship Upgrade Card turns the card balance into an installment plan, saving consumers money on interest while helping them responsibly build credit. Other credit cards in the company’s line-up include the 1.5% back flat rate Cash Rewards card, the Triple Cash Rewards Card (which offers 3% cashback on payments for purchases in Home, Auto, and Health categories), and the recently-launched Bitcoin Rewards card.
Upgrade also introduced Rewards Checking earlier this year, allowing users to earn 2% cashback on “everyday expenses” including purchases at convenience stores, drugstores, gas stations, and restaurants, or by making recurring payments for utilities, phone, cable, and select monthly subscriptions with their debit card. True to its roots, the company continues to offer personal loans up to $50,000 as well. In total, the FinTech firm reports that it’s offered more than $7 billion in affordable credit to consumers via its card and loan products over the company’s four-year history.
Commenting on the latest funding round and how Upgrade plans to utilize the funds, co-founder and CEO Renaud Laplanche stated, “We are thrilled to partner with KDT. We have experienced unprecedented growth and profitability this year, and the additional capital will enable us to further establish Upgrade Card as a mainstream credit card and continue designing innovative products that benefit consumers.”
Meanwhile, KDT’s managing director Byron Knight said of the investment, “We are seeing rapid innovation in banking, and believe FinTech, and neobanks in particular, will profoundly transform the banking industry to the greater benefit of consumers. Upgrade has proven success in designing products that deliver more value and a better experience to consumers, and we believe they are uniquely suited to be a market leader.”
As Knight points out, there’s been a neobank boom over the past several years, which has only accelerated in recent months. Upgrade’s latest megadeal once again highlights this growing sector and continues a blockbuster year for FinTech at large. On that note, following a record-setting second quarter, it seems as though FinTech funding in Q3 2021 has a shot at surpassing that total, with 2021 promising to be a major milestone for the industry.