Credit Karma, the online credit score provider and credit marketplace, has raised $85 million in a new round of financing led by Google Capital with participation from Tiger Global Management and existing investors.
The company’s announcement confirms our earlier reporting, with $60 million of the new cash going to the company and another $25 million being used as a secondary investment to provide liquidity to existing shareholders and employees, according to people familiar with the company’s financing plans.
Since its launch nearly eight years ago, Credit Karma has raised $118.5 million to pursue its business plan of developing a marketplace where consumers could receive information on their credit scores for free and determine how best to service their existing debt.
As we reported earlier, the company has managed to roll up a user base which accounts for $1.2 trillion of U.S. consumer debt, or roughly 10% of the nearly $13 trillion of consumer debt outstanding in the U.S.
Now, building out services to monetize those users, Credit Karma is looking to be a sort of Kayak for the financial services industry.
On top of letting customers access their credit score for free, the company is looking at partnering with banks to create a recommendation and origination engine for consumers to better manage their debt loads.
Neither Google Capital or Tiger Global Management responded to requests for comment on their investments. Previous investors Susquehanna Growth Equity and Ribbit Capital also contributed to the financing, which gave the credit company a post-money valuation of under $1 billion.
Since the beginning of March, Tiger Global has been involved in at least three announced deals totaling over $200 million in committed capital — so it’s been fairly busy.
Coming on the heels of the $77 million round for OnDeck, the two investments could presage a wave of investment in consumer-facing financial services companies, according to investors familiar with both companies.
Photo via Flickr user Sean MacEntee