San Francisco-based fintech giant Varo Bank announced Thursday that it raised $510 million in an oversubscribed funding round. The round, led by Lone Pine Capital, is the company’s second fundraise this year.
In February, Varo closed on a $63 million round led by Russell Westbrook Enterprises. At the time, the NBA MVP of the same name announced he would have a hand in the direction of the startup’s social impact programs.
“Partnering with Varo to directly address systemic barriers faced by underserved communities has proven to be an important and unique effort,” Westbrook said in a statement. “[Varo Bank] continues to educate users about financial literacy to match the needs of the next generation of bank users regardless of their socioeconomic backgrounds.”
Founded in 2015, Varo bills itself as the first all-digital national bank in the United States. The company offers customers bank accounts without minimum balance requirements or monthly account fees.
Since obtaining its bank charter, the fintech company has seen massive amounts of growth. In the last 13 months, Varo has doubled the amount of its opened accounts to four million and tripled the size of its revenue, according to the company.
“The time is now to bring the best of fintech to the regulated financial system and build an entirely new kind of bank: one where consumers no longer have to choose between a sophisticated digital experience and a trustworthy banking partner,” Colin Walsh, founder and CEO of Varo Bank, said in a statement.
Varo’s revenue growth landed it a top 10 nationally on the Inc. 5000 list of the fastest-growing private companies in the U.S. Varo also placed higher on the Inc. 5000 Regionals list than any other Bay Area startup. The fintech platform is one of the top five highest-growth companies in the state of California.
Following the latest raise, Varo plans to move forward on its mission to increase access to banking tools and promote financial literacy. The company plans to launch a range of new financial products including Varo Advance and Varo Perks.
Varo Advance will offer users a short-term line of credit and Varo Perks will offer users cashback rewards.
Over the last year, Varo’s headcount has nearly doubled and the company plans to continue the hiring momentum. The company is now hiring for over 50 positions across its engineering, data, design, marketing and product teams, to name a few.
Varo Bank has raised nearly $1 billion in financing to date.
Additional investors Declaration Partners, Eldridge and BlackRock participated in the round, among others.
