Upgrade has raised $105 million in a Series E funding round at an upsized valuation of $3.325 billion according to a company release. Koch Disruptive Technologies (KDT), the investment subsidiary of Koch Industries, led the funding with both new and existing investors participating in the funding round, including BRV and Ventura Capital.
Financial Technology Partners LP and FTP Securities LLC (FT Partners) served as the exclusive financial and strategic advisor on the deal.
Upgrade CEO and co-founder Renaud Laplanche said they were thrilled to partner with KDT:
“We have experienced unprecedented growth and profitability this year, and the additional capital will enable us to further establish Upgrade Card as a mainstream credit card and continue designing innovative products that benefit consumers.”
Upgrade is a digital lender and aspiring neobank that competes with traditional banks by providing a better service and value for its customers. The Upgrade Card is designed to promote responsible credit by turning every balance into a fixed-rate installment plan, and by paying rewards to cardholders as they pay down their balance.
Upgrade reports having delivered over $7 billion in credit to consumers through cards and loans since inception in 2017, and says it is on track to deliver $7 billion in 2021 alone.
Upgrade offers a rewards checking account that provides 2% cashback rewards to consumers on everyday expenses.
More recently, the company launched the Upgrade Bitcoin Rewards Card, a credit card that pays rewards in Bitcoin rather than cash.
Byron Knight, Managing Director at KDT, said they believe that Fintechs and neobanks, in particular, will profoundly transform the banking industry:
“Upgrade has proven success in designing products that deliver more value and a better experience to consumers, and we believe they are uniquely suited to be a market leader.”