Bank account startup Chime beat Robinhood to become the highest-valued fintech startup, valued at $14.5 billion after it raised money, a media report said.
The San Francisco company in its latest round of funding, Series F, raised $485 million from Coatue, Iconiq, Tiger Global, Whale Rock Capital, General Atlantic, Access Technology Ventures, Dragoneer and DST Global, CNBC reported.
Chime will now have almost $1 billion in cash, according to the report cited above.
Chime, founded in 2013, offers customers mobile banking accounts, debit cards and ATM access at no fee. It earns revenue from merchants when its subscribers swipe their cards to purchase goods and services.
After the round closed, Chime’s valuation has surged more than 150% from $5.8 billion in December last year to $14.8 billion, CNBC reported.
Robinhood, the popular stock-trading app, was valued at $11.2 billion last month after it raised $200 million from investors.
The coronavirus-imposed lockdowns have benefited challenger financial-services apps like Chime and Robinhood both in revenue and transaction volume.
During the pandemic Chime has been profitable based on earnings before interest, taxes, depreciation and amortization, the company said.
“Nobody wants to go into bank branches, nobody wants to touch cash anymore, and people are increasingly comfortable living their lives through their phones,” Chief Executive Chris Britt told CNBC.
“We have a website, but people don’t really use it. We’re a mobile app, and that’s how we deliver our services.”
In August, Robinhood said it added 3 million customers in the prior four months to reach a total of 13 million users. It posted revenue of $180 million for its June quarter.