Payroll connectivity platform Pinwheel secured $20m in a Series A funding round led by Coatue.
This funding round also saw participation from Primary Ventures, Semper Virens and support from existing investors, First Round Capital and Upfront Ventures. In addition, notable angel investors including Raj Date, the first Deputy Director of the Consumer Financial Protection Bureau, Tony Xu of DoorDash, Gokul Rajaram, Adam Nash, Jackie Reses, Shishir Mehrotra of Coda, Amit Agarwal from Datadog and Shiva Rajaraman among others too joined the round.
Pinwheel, which emerged from stealth in September 2020, connects systems to banks, lenders and other providers. It also provides API access to payroll systems. Banking consumers can use the company for direct deposit switching and move paychecks to a new bank account. The company also works with lenders to retrieve account data such as income and employment to improve the verification process.
Pinwheel integrates with every major payroll provider, government portal, and gig economy platform. The company’s customers include Square Cash App and Current.
The news comes at a time when Pinwheel has seen its revenue grow 11x over the past quarter and has increased coverage to over 100 million Americans. “In a quarter, we will be doing close to half of all direct-deposit switches in the neobank market,” it said.
Pinwheel currently has about 40 employees and with this fresh funding, it plans to boost its team. Among notable hires, Lauren Crossett, formerly of Plaid and Quovo, recently joined the company as head of commercial.
The firm aims to “lay the foundation for future applications of our product that become possible by unlocking payroll information.” Furthermore, it seeks to be a part of a future where “FICO and Equifax aren’t the only tools businesses use to make decisions for customers that can impact futures and livelihoods,” the company stated.
Commenting on the round, Coatue general partner Michael Gilroy said, “We have been fortunate enough to partner with a number of the leading fintech infrastructure players and think Pinwheel is the next transformative platform. We believe the company has quickly emerged as the leading platform in the market powering the next generation of financial products for some of the largest consumer-facing FinTechs.”
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