Petal, a financial technology upstart that aims to provide credit cards to young people and others who lack a credit history, has raised $13 million, it said on Wednesday. The Series A round was led by billionaire Peter Thiel's Valar Ventures. The funds will be used to roll out the credit card nationwide; it is currently only available via waitlist, where it has attracted some 40,000 people. Petal is among a new crop of companies that are roping in non-traditional data in their underwriting to approve millennials, immigrants and other consumers who are typically turned away from banks and lenders because of their limited credit histories.
Petal nabs $13M from Peter Thiel’s Valar Ventures to get credit cards to people without credit scores
Fledgling fintech startup Petal has raised $13 million in a series A round of funding led by Peter Thiel’s Valar Ventures. Other participatory investors include Third Prime Capital, RiverPark Ventures, The Social Entrepreneurs’ Fund, Brooklyn Bridge Ventures, Afore Capital, Rosecliff Ventures, Great Oaks Venture Capital, New Ground Ventures, Abstract Ventures, Ride Ventures, Story Ventures, and The Gramercy Fund.
New Credit Card Option for Those With Scant Credit Histories
A New York start-up aims to use everyday financial information to qualify people with scant or no credit histories for its credit cards. The company, called Petal, considers an applicant’s standard credit scores, when available. But it also analyzes their digital financial records, like checking accounts or, in some cases, prepaid debit cards, to rapidly assess their income and spending habits. “It uses more financial information to make a credit decision,” said Jason Gross, chief executive and co-founder of Petal.