Zero has successfully raised $147 million over five funding rounds, attracting significant investment from top investors like New Enterprise Associates and ENIAC Ventures. The platform offers a unique banking experience by combining the simplicity of a debit card with the cash back benefits of a credit card.
Keep reading to explore the intricacies of Zero's fundraising journey and the innovative features that set this platform apart in the financial services industry.
What Is Zero?
Zero is a bank replacement app that combines the simplicity of a debit card with the cash back of a credit card. Founded by Joel Washington, the company is based in Silicon Valley and San Francisco.
Zero offers FDIC-insured deposits and unlimited 1% to 3% cash back on purchases with Zerocard, a World Mastercard. The company has a team of 11-50 employees dedicated to providing a more rewarding mobile banking experience.
With no foreign transaction fees, annual fees, account minimums, or monthly maintenance fees, Zero aims to replace traditional banking with a user-friendly and rewarding system.
How Much Funding Has Zero Raised?
- Funding Round: Seed
- Amount Raised: $2,500,000
- Date: September 2016
- Motivation Behind the Round: To develop the initial product and establish the company.
- Funding Round: Seed
- Amount Raised: $8,500,000
- Date: October 2017
- Lead Investors: Eniac Ventures
- Motivation Behind the Round: To develop and launch the Zerocard, addressing young adults' concerns about debt.
- Funding Round: Series A
- Amount Raised: $20,000,000
- Date: May 2019
- Lead Investors: New Enterprise Associates (NEA)
- Motivation Behind the Round: To expand the customer base and fully launch the product to the 204,000 people on the waitlist.
- Funding Round: Unknown
- Amount Raised: $16,000,000
- Date: November 2018
- Motivation Behind the Round: To support operational expenses and growth.
- Funding Round: Unknown
- Amount Raised: $100,000,000
- Date: February 2020
- Motivation Behind the Round: To scale operations and enhance product offerings.
Total Amount Raised: $147,000,000
Current Valuation: $500,000,000 (~estimated)
Key Investors
- New Enterprise Associates (NEA)
- Details: NEA is a global venture capital firm with a focus on technology and healthcare. They have a long history of successful investments and are known for their extensive network and resources.
- Investment Focus Areas: Technology, healthcare, consumer sectors.
- Notable Investments: Robinhood, Coursera, Duolingo.
- ENIAC Ventures
- Details: ENIAC Ventures is a seed-stage venture capital firm that invests in early-stage technology startups. They are known for their hands-on approach and strong founder support.
- Investment Focus Areas: Early-stage technology startups.
- Notable Investments: Airbnb, SoundCloud, Hinge.
- SignalFire
- Details: SignalFire is a data-driven venture capital firm that leverages technology and AI to identify and support promising startups. They focus on providing operational support and resources to their portfolio companies.
- Investment Focus Areas: Data-driven venture capital, technology, AI.
- Notable Investments: Grammarly, Frame.io, Ro.
- Nyca Partners
- Details: Nyca Partners is a venture capital firm specializing in fintech and financial services. They are known for their deep industry expertise and strong network in the financial sector.
- Investment Focus Areas: Fintech, financial services.
- Notable Investments: Acorns, Affirm, Revolut.
- Lightbank
- Details: Lightbank is a venture capital firm that invests in early-stage technology companies. They are known for their focus on disruptive technologies and innovative business models.
- Investment Focus Areas: Early-stage technology companies.
- Notable Investments: Groupon, Udemy, Sprout Social.
What's Next for Zero?
Zero stands at the cusp of a significant opportunity, targeting millennials who prefer debit cards over credit cards. With a waitlist of over 200,000 people, the potential market size is substantial. The company's unique product, which combines the benefits of credit cards with the control of debit cards, positions it well to capture this growing demographic.
Given the strong interest and successful funding rounds, Zero is likely to attract more investors in the future. The innovative approach and experienced executive team make it an attractive investment opportunity. However, the company will need to navigate challenges such as competition from traditional banks and other fintech startups, as well as the complexity of managing both a credit card and a checking account program.
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