Pinwheel, announced that it raised $50M in a Series B round led by GGV Capital, with continued participation from Coatue, First Round Capital, and Upfront Ventures, as well as new investments from strategic partners including AMEX Ventures, Indeed, Kraken Ventures, Franklin Templeton, and more.
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Pinwheel’s mission is to help create a fairer financial system by providing an API that makes it easy for businesses to securely connect payroll accounts to their applications with consumer permission. By establishing this layer of income connectivity, fintechs, financial institutions, and more can develop new tools or services that provide equitable access to financial services for everyone, including the 67% of Americans who are considered to be financially unhealthy.
While income and employment status are the key determining factors in all financial decisions, these pieces of information have not been easily accessible, making it impossible to tailor financial services offerings to a person’s specific financial situation. Pinwheel’s market-leading data coverage spans nearly 80% of people employed in the United States. This is the industry’s most comprehensive level of data, from traditional forms of income and work via payroll systems for the top 500 employers, to a burgeoning ecosystem of less traditional income and work such as gig and creator economy platforms. This breadth of data solves the missing income link, ushering in the next generation of equality-focused fintech innovation.
For example, Pinwheel provides real-time data about a person’s income, and uniquely covers not just scheduled direct deposits for salaried employees but also hourly clock-ins, most accurately showcasing any type of income. This data can be used to enable offerings such as earned wage access (EWA), whereby a person can receive their money as soon as they’ve earned it, bypassing the waiting period for a paycheck. When met with an immediate financial need, a person now has an option that can actually maintain or improve their credit by avoiding high-interest-rate payday loans or credit cards. Similarly, Pinwheel’s technology can also be applied to other scenarios such as lending evaluations, and more. This establishes a more symbiotic relationship between consumers and financial services. Pinwheel’s industry-preferred flagship products such as direct-deposit switching, income and employment data, and paycheck-linked lending, power innovations such as these.
With Pinwheel, through developing unique offerings that will improve the overall fiscal health of people in the US, fintechs and financial institutions are able to more successfully acquire new customers and retain existing ones, all while offering consumers improved experiences that disrupt the financial status quo. Pinwheel works closely with its customers including Block (formerly Square), Varo, Lendly, and Daylight to pave the way for a fairer financial system.
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“With this latest round so closely following our Series A, we’re poised to rapidly scale and introduce new solutions that will change finance as we know it,” said Kurtis Lin, co-founder, and CEO of Pinwheel. “I’m particularly passionate about addressing the vicious cycle of paycheck-to-paycheck-living that plagues almost 80% of people in the United States, by developing products that will power EWA and dynamic lending opportunities. I look forward to a world where people are proactively offered new terms of payment for a personal loan should they lose their job, or earlier access to their paycheck in a time of crisis instead of facing payday loan sharks.”
“Pinwheel’s API unlocks the power of the income layer, driving the next wave of innovation in the fintech ecosystem,” said Tiffany Luck of GGV Capital. “Pinwheel has the ability to impact every American that receives a paycheck. Such an immense opportunity, coupled with the company’s mission to build a fairer financial system, uniquely positions Pinwheel to reshape so many people’s financial lives in a positive way. We are proud to partner with them on this journey.”
Thanks to its best-in-class team made up of many fintech industry veterans, Pinwheel has built an enterprise-ready platform that securely executes over 4.6M processes per month, a 400x increase from the previous year. Pinwheel leads the market in conversion rates. Last year, Pinwheel increased its annual recurring revenue by 177x.
With this funding, Pinwheel plans to triple its headcount to 180 people, with a particular emphasis on engineering roles, to continue work on EWA and to expand into new areas such as tax preparation. Additionally, the company will further its commitment to setting the industry standard for the security of consumer data. Last year, Pinwheel received its SOC2 Type 2 compliance. Not only is Pinwheel the only payroll data provider to have a CISO, but it is also the only company that handles both direct deposit switching and the provision of payroll data to be a Consumer Reporting Agency (CRA) compliant with the Fair Credit Reporting Act (FCRA).
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