NerdWallet, the six-year-old company launched with $800 by company co-founder and chief executive, Tim Chen, has raised $64 million in its first round of outside financing.
Sources with knowledge of the company’s plans had put the round at $60 million. NerdWallet also raised an additional $36 million through a revolving loan facility with Silicon Valley Bank.
The later stage round came from a host of connected angel investors in the financial technology sector and was led by the later stage growth equity investor Institutional Venture Partners. Additional participation came from RRE Ventures and iGlobe Partners, an Asia Pacific-based investment firm.
Last year, 30 million people used NerdWallet to get financial advice on a range of subjects. The company offers comparison shopping tools on financial products including: healthcare; mortgages; life insurance; banking; credit cards; financial services and wealth management; small business tools, and college loans.
“To be honest, I want to cover every substantial financial decision that anyone can make in their life,” said Tim Chen. “We’re talking about a shitload of big decisions there.”
Chen’s company is squarely focused on the content business for now, but NerdWallet may have eventual aspirations to provide financial tools as well as financial advice for a new generation of financial services consumers.
The secret to NerdWallet’s success, aside from Chen’s steady management and decision to steadily grow a profitable business rather than rush to take capital, comes from a basic truth of the financial services industry. As Chen puts it, “There’s this huge asymmetry of information.”
Ultimately the tools that are the best for consumers may not have the best rewards for service providers who are incentivized by the funds they’re peddling. Much of the cash that Chen has raised for NerdWallet will, in fact, be spent on product.
“We’re in the first inning of [the business],” says Chen. “A lot of what you see on the site isn’t more advanced than what I put together in the last three or four years. We really want to overhaul it and get it ready for what I think will be a data play.”
Already other companies like Credit Karma and Feex, have seized on NerdWallet’s mission to provide unbiased information to consumers about the financial tools that they use. But unlike those companies, Chen’s vision is all-encompassing.
“If you think about the logical extensions of where we want to go… We want to make it easier and easier for millennials to move their financial products to what are the best places for them to go.”
The company would not comment on its revenue except to say that it would look to grow its staff from 200 to 300 employees by the end of the year and that the hiring push could be done without touching the new $64 million in cash sitting in the bank or the $36 million revolving loan the company received from Silicon Valley Bank as part of the latest financing.
According to the company, it has partnerships with eight undisclosed banking and credit card companies and has managed to scoop up high level executives from companies like Box, J.P. Morgan, LinkedIn, Visa, and Zynga.
As a result of the investment Jules Maltz from IVP and Tom Loverro from RRE Ventures will take a seat on the board. Soo Boon Koh, iGlobe’s managing partner and founder will have a seat on the board of advisors alongside James Robinson III, former American Express CEO, Vikram Pandit, the former CEO of Citigroup, and David Henke, the former SVP of engineering and operations at LinkedIn and Yahoo.