Online Lender Avant Acquires Debt Management Service ReadyForZero

Online lending platform Avant has acquired ReadyForZero, a Y Combinator-backed startup that helps consumers better manage their personal debit and credit using online financial software, the companies are announcing this morning. Financial terms are not being disclosed, but Chicago-based Avant had plenty of funds to play around with, having raised $334 million in equity capital, in addition to nearly a billion in debt.

ReadyForZero had raised around $5 million in seed through Series A rounds from Citi Ventures, Polaris Ventures, YC, and others.

Also of note: ReadyForZero’s co-founders Rod Ebrahimi and Ignacio Thayer both participated in Y Combinator as had Avant’s co-founders John Sun and Paul Zhang. However, they were in programs that were around a year apart.

From the sound of things, ReadyForZero was struggling to scale ahead of this acquisition. The startup had signed up just over a quarter of a million users, and 4% were upgrading to premium products, like its automated bill pay service, we’re told. But ReadyForZero had to shut down its paid services earlier this year, lacking the human resources to keep them maintained, admits Ebrahimi.

“We had misjudged how many people it would take to actually service that,” he explains. The co-founder notes that the startup was trying to grow its team, while also exploring what it would do next. The next big vision it had was to get into the lending business, he says. That meant either doing a strategic partnership, or getting into the space itself. Though they were in discussions with others in the space, it turns out that Avant actually reached out to ReadyForZero first.

Avant, by way of background, uses a combination of big data and machine-learning technology to offer consumers quick loan quotes that can be funded as soon as the next business day. To date, it has issued over 150,000 loans it says, at lower-than-traditional rates.


Meanwhile, ReadyForZero’s online and mobile tools also focus on the debt management space, initially by helping consumers tackle their outstanding credit card debt, before expanding to include other types of debt, like student loans, auto loans and mortgages.

The service is not a competitor with debt consolidation companies, meaning it doesn’t negotiate with creditors on your behalf to reduce rates. Instead, ReadyForZero operated in a similar way to something like by allowing consumers to import data from their bank accounts, credit card accounts and loans. It then uses this information to make recommendations as to how you could make extra payments to save on interest or consolidate your loans with various partners for better rates and a faster exit from debt.

To date, the company claims it has helped its customers pay down $220 million in debt. Additionally, it says it has reduced net-credit losses at top banks, and has helped raise consumer credit scores by as much at 40 points.

Bringing in ReadyForZero’s technology made sense for Avant, explains Avant CEO Al Goldstein, because the two companies were trying to tackle the same goals.

“The reason we were really excited about working with Rod and the team is because we have a shared vision for what we want to build…we believe ReadyForZero could be a huge, long-term brand that has its own strength,” he says. “We want to make it available to all our customers.”


Goldstein says that Avant aims to be the sole provider of financial services products for consumers in the middle-income category ($35,000-$85,000 per year in household income). The idea would be to offer ReadyForZero’s services for free to these consumers going forward. In some cases, the consumers using the service wouldn’t yet qualify for Avant’s own loans, but over time, that could change as they became more financially savvy thanks to using ReadyForZero.

ReadyForZero, in the meantime, would remain unbiased – pointing its customers to Avant’s loans when they made sense, or to other partners when they were a better fit.

Following the deal’s close, Ebrahimi and Thayer will continue on at Avant, leading engineering and product management at the company’s new L.A. offices opening in April, located near the Playa Vista neighborhood. Most of the startup’s 12-person team is joining Avant, Ebrahimi confirms.

The team there is expected to grow to 50 by year-end, while Avant itself is planning to expand to over 1,000 employees by the end of 2015.

Though ReadyForZero will remain an independent brand and website going forward, the product will also be offered to Avant’s customers through website integrations that take advantage of ReadyForZero’s API.

As of today, ReadyForZero will begin featuring Avant products in its recommendation engine, and there will be some content contributions to its blog as well. Later this year, the service will be integrated with And in the near future, the company plans to internationalize the ReadyForZero product, as well as bring back its previously shuttered upgraded services.