Step, a San Francisco-based mobile banking service directed at teens, has announced on 2nd December 2020 to have raised US$ 50 million in Series B funding led by Coatue after growing to over 500,000 users only two months after its official launch. Other investors include returning investors Crosslink Capital, Collaborative Fund, and Will Smith’s Dreamers VC. The startup also nabbed some celeb investors to this round, including Charli D’Amelio, Justin Timberlake, The Chainsmokers, as well as sports stars Eli Manning, Kelvin Beachum, Larry Fitzgerald and Andre Iguodala.
This is notably Charli D’Amelio’s first startup investment, according to TechCrunch. The startup had partnered with the TikTok star only a few weeks ago to promote the product and speak about financial literacy across her TikTok and Instagram accounts, which have 101.9 million and 34.4 million followers, respectively. Previously just a partner and customer, now she has also become an investor.
The other celeb investors may also promote the product on social media, including The Chainsmokers, but promotional deals haven’t been finalised yet. Smith has been investing in startups in the last few years at the seed stage.
Step plans to leverage its newly partnered celebs to help spread the word about mobile banking and financial responsibility across social media and is hiring across the board in the face of its accelerated growth.
Even though competing in a crowded space of mobile banking services which replace traditional banks with an app on the phone, Step’s entry point to the market is different from most of its competitors. The app also serves as a P2P platform so that customers can send money to friends, similar to Apple Pay or Venmo.
What Charli D’Amelio has to say
“As a Step partner and customer, I’ve been able to see firsthand how easy Step makes it to manage your money while providing the educational resources that today’s teens need but have largely been unable to find—myself included,” said Charli D’Amelio, in a statement.
“I’m excited to be able to use my platform to help close this gap and have made a direct investment in Step to help them develop even more useful products,” she also added.
What Will Smith has to say
“As a person who hasn’t always had financial stability, and made many mistakes in that arena as a young man, I know the importance of financial education and having access to economic platforms that can work for everyone,” Will Smith said in a statement.
“While I’ve tried to instil that same mentality in my own children it was hard to find a banking platform that was intuitive and met our needs as a family. We’ve reinvested in Step because not only are their products built specifically for teens but they’ve started an important conversation around financial literacy that kids are actually engaged in,” he also added.
The company is a mobile banking service that specifically targets teen users in the age group of 13 to 18, by offering them an FDIC-insured bank account without fees, and a secured Visa card that helps them establish credit before they turn 18. It was founded by CJ MacDonald and Alexey Kalinichenko in 2018.
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