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This latest funding round brings the company's valuation to over $1 billion
One thing I started hearing the minute that I became an "adult" (meaning I turned 21, graduated college and started making some money) is that I had to find out my credit score. I still don't know what it is, though, because it's honestly not that easy to find out. Finding find a free credit monitoring service seems to be nearly impossible.
One of the new that does seem actually offer a credit score for free is personal finance platform Credit Karma. And now the company has now raised $75 million in new funding, it was announced on Monday. The funding came from from existing investors Google Capital, Tiger Global Management and Susquehanna Growth Equity.
The funding round may not actually wind up being quite as high as that, though, because the portion of the funding coming from Google Capital is subject to regulatory approval, and is expected to close in the fourth quarter of this year.
"Based on Credit Karma’s latest valuation, and due to the size of Google’s aggregate investment (including the Series C and this proposed new investment), a customary HSR filing is required," Christina Ra, Director of Public Relations at Credit Karma, explained to me.
Credit Karma had previously raised $118.5 million in funding, including an $85 million round in March of this year. If it raises the full $75 million, the company will have now raised a total of $193.5 million, from investors that include Ribbit Capital, Felicis Ventures, QED Investors, Founders Fund and SV Angel.
With this latest round, the company is now valued at more than $1 billion, Ra confirmed.
"We believe this investment speaks to two themes: Continued confidence that we are the industry's leading consumer credit and finance platform, and repeated strong consumer demand for our product," Ken Lin, CEO and founder of Credit Karma, said in a statement. "Today's complex marketplace requires a pro-consumer resource that makes financial comprehension easy, transparent and empowering. Credit Karma delivers that."
Founded in 2007, Credit Karma offers many of the same features that other services offer, such as bill reminders, alerts, personalized debt management recommendations, and spending breakdowns to show users where their money is going. The site also offers a comparison feature that lets users compare interest rates on their credit cards and loans of all types.
But the major difference between Credit Karma and other personal finance tools is its focus on credit ratings. Credit Karma offers users a more complete picture of their credit, which is missing from a lot of other personal finance sites.
"Everything is free. Consumers can refresh their credit scores and credit reports weekly. There is no 'freemium' model that provides some things for free and other things at a cost. Credit scores, credit reports, credit monitoring — all of our resources and tools are free. Assisting consumers shopping for financial products is a cornerstone of Credit Karma’s mission," Ra told me. "We’ve worked with more than one hundred lenders (credit card issuers, loan providers) so that we can feature products and offers tailored to each member’s unique credit profile. We’re able to match credit and personal finance profiles with financial products that make sense, removing a big pain point when it comes to shopping for credit."
Credit Karma says it will use the new funding to "further advance its growth initiatives and ongoing product innovation."
"Credit Karma will continue to provide free resources and information so that consumers can take control of and leverage their credit, as well as help consumers search or shop for financial products, such as credit cards, loans and mortgages," said Ra.
The San Francisco-based company now has more than 30 million consumers, an increase of 50% increase since February of this year.
(Image source: creditkarmacdn-a.akamaihd.net)
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