The working class of the United States doesn’t get a lot of breaks these days. It is not only a function of low pay and long hours, but also the incredible uncertainty of income and expenditure that makes survival from week to week so difficult. One in five Americans has negative net wealth, even in an economy where the Unemployment rate lowest in nearly two decades. Banks, on the other hand, are actively dissuade the working class from doing business with them, creating a permanent class of unbanked and underbanked citizens.
For Jon Schlossberg, CEO and co-founder of Even.com, improving the lot of ordinary Americans and their finances is a deeply personal and professional mission. And now that mission has a huge new bucket of capital behind it, with Keith Rabois of Khosla Ventures leading a $ 40 million Series B at the Oakland-based startup. Rabois is a returning investor, having previously supported the company in its fundraising round at the end of 2014. With this last round of table, Even.com has now raised $ 50.5 million.
When Even.com First launched its eponymous app, the goal was to offer income smoothing to workers, helping them avoid spurious payday loans to make ends meet. Since that first launch several years ago, Schlossberg and his team have learned that the only way to improve the finances of the working class is to help them budget better – by ending the need for loans in the first place. “To do anything with your life, unless you were born into the right family, you have to spend your money wisely, but we never teach you how to do that,” Schlossberg explained to me.
Last year, Even.com announced that it had stopped in the evening via its Pay Protection product. Instead, Schlossberg said that Even.com evolved and wanted to “build a new type of financial institution with products that match your life”. He still has a feature he calls Instapay, which allows users to claim their earned paycheck before their paycheck.
Corn Even.com Increasingly focused on improving the quality of its smart budgeting function. Using artificial intelligence models refined over the past few years, the company now gives users of its Even app a “OK to spend” number that helps them think about their cash flow. By giving a predictive number rather than a checking account balance, Even can help its users avoid sudden surprise expenses that can trigger the kind of financial death spiral that has become a household story in America. The company will also soon launch an automatic savings feature similar to Figure Where Tassels that helps people build regular savings.
As the company offers an increasingly comprehensive suite of financial tools, it has decided to avoid charging user-specific user fees, opting for a subscription model instead. Schlossberg explained that “we’re a mission-driven company, but talking is cheap and where the rubber hits the road, that’s how you make money. Even is free for users participating through partner employers, or $ 2.99 per month for those without a sponsor.
The company’s highest spend function is Instapay due to underwriting, so the company earns higher profits when fewer of its customers need access to payday credit. In other words, the better the budget of its users, the less loans it will take out and the more money the company will earn. We have a “direct incentive to help people with their financial health,” Schlossberg noted.
Even has proven to be attractive to corporate clients, including Walmart, which partnered with the startup last December to offer its service to all of the retailer’s 1.4 million employees. Since the partnership’s launch, more than 200,000 Walmart employees regularly use the app, according to Even, and the typical active user checks their OK balance to spend four times a week. A majority of active users have also purchased Instapay through Even.
More interestingly, salaried employees at Walmart used the app a little more than hourly workers, proving that just having a guaranteed income isn’t necessarily a panacea to financial woes for many American households. .
Even.comThe series B’s cycle is focused on the expansion and growth of the business. Even intends to open an office on the east coast this year and intends to expand its product into the Fortune 500 with partnerships similar to its Walmart deal. The company currently has 37 employees. In addition to Khosla, the startup has raised funds from Valar Ventures, Allen & Company, Harrison Metal, SV Angel, Silicon Valley Bank and others.