Former Disrupt Battlefield participant Self Lender has raised a $1.5 million round of seed capital from Silverton Partners, who wrote the full check. The new cash comes after the firm raised a prior total of $535,000 from TechStars, Kickstart Seed Fund, and Galvanize Ventures.
To date, Self Lender has raised $2.035 million.
The company uses loans to help individuals establish, and in some cases work to repair their credit history. Self Lender, in a sense, allows users to loan themselves money that they repay over a regular period, after which the initial sum is returned — you can’t spend the loan amount, as it’s out of your control until the payment period wraps up.
It’s a neat way to help the millions of Americans who have little or no credit history get a start. According to the firm, these so-called “credit builder loans” are products sometimes offered by non-profits.
Self Lender has come quite a ways since its public debut last September. Then, the company was in search of a banking partner and couldn’t yet report to all three major credit scoring firms. Now, the startup is working with Austin Capital Bank, and through that deal, can send its data to all the credit majors.
According to the company, there are nearly 15,000 people waiting to use the second version of its product. In an email to TechCrunch, Self Lender indicated that it is “currently integrating [its product] with [its new] banking partner,” and intends to “on-board the first 100 users” onto its “new credit builder loan program by September.”
The Hustle Is Real
A company raising a bucket of money in today’s climate is roughly as noteworthy as perfect weather in Palo Alto. What makes Self Lender an interesting firm to consider is how close it came to dying.
James Garvey, the co-founder and CEO of the company, posted a blisteringly honest history of Self Lender, including anecdotes of how he managed to scrape along to get to today. A sample quote:
[After TechCrunch Disrupt SF 2014] [w]e met with major banks, but we got nowhere. No one would take use seriously. Then, my partner & I parted ways — amicably, but still heartbreaking and very stressful. It was an incredibly depressing period of my life.
Without a bank or a team, Self Lender did not have the foundation to accomplish even a quarter of our primary objectives.
Garvey then failed to get into TechStars NYC. He kept the company alive, however, eventually making it into TechStars Austin. A banking partnership remained a sticking point. And then, after more hustle, the company managed to snag both the partnership it needed, and enough cash to float its operations.
There is too much ‘overnight success’ in the tech press, and I’m as guilty of that particular myopia as anyone else. But with Self Lender, its story has big ups, and big downs. Sometimes you have to struggle before you succeed.
Now with the money and the corporate pals it needed, it’s up to the little company to execute. I’ll check back with Garvey in a few months to see how things are going.