Line Acquires $25M in Equity, Debt to Build Inclusive Financial System

Line, the firm building a “modern” inclusive financial network, announced that it has secured $25 million in equity and debt, with Massive leading the funding round.

As mentioned in an update shared with CI, Line is a Public Benefit Corporation mission-driven “to deliver unprecedented access to financial services with uncompromising quality and without restrictions like income type, income level or credit history.”

As noted in the announcement, the long-term vision is “an inclusive, interoperable financial network that replaces today’s fragmented mess that either forces folks who can least afford it to subsidize the ecosystem’s inefficiencies with fees and higher interest rates, or simply blocks them from access to products for not fitting outdated criteria.”

Akshay Krishnaiah, Line’s founder and CEO, stated:

“Most of the financial industry focuses on the same group: people with a monthly or biweekly W2 paycheck and some mix of checking, savings and maybe investment accounts – and still indexed mostly towards men. Meanwhile, a growing portion of the population is making life work through a combination of gig work, hourly jobs, government assistance and cash wages. At least 50% of whom are women who earn a fraction of what men who do at the same job and lose pay when they take a leave of absence for caretaking responsibilities,” 

Krishnaiah added:

“My own experience immigrating from India where I was raised by parents who came from extreme poverty drove me to create Line to provide a relevant, inclusive and easily accessible financial product for everyone – without the added weight and cost of predatory practices constantly telling people who’s worthy and who’s not.”

Despite being qualified, banked, in essential jobs and working hard to spend less than they earn, “over three billion people globally and more than 100 million people in the US are unable to access commonly needed financial services.”

This group has insufficient credit histories, “what are considered nontraditional work arrangements, and/or traditional work arrangements with poor corporate policies that render their income irregular (i.e. lack of paid leaves, loss of child care credits, etc.).”

Rather than resulting in new solutions that meet this group where they are to lift them up, this has instead led to a trillion-dollar predatory financial services industry that “includes things like cash advance apps, check-cashing services, credit-finance companies, payday loans, pawnshops and title loans.”

Line’s investors know that “existing financial institutions have been built by and for a subset of the population, and that building something new for folks left out of existing systems is essential to truly create financial inclusion.”

Their backgrounds “are varied, but their vision for a better future is singular: Line.”

The round was led by “a carefully chosen group of investors aligned with Line’s mission as a Public Benefit Corporation – led by Massive and followed by TASC Ventures, along with a group of BIPOC investors, social impact funds and women-led funds like Goodwater Capital, SustainVC, Avesta Fund, Strada Education Network, The Josephine Collective, Overtime VC, Techstars and Kelmhurst.”

They are “joined by angel investors Alex Haro, CTO of MyMoneyKarma; John Kim, CEO of Sendbird; Chris Nguyen, co-founder of LogDNA; Soups Ranjan, CEO of Sardine; and Ethan Austin.”

Line’s proprietary technology “both dynamically adjusts to meet individuals where they are on their financial journey and actively accounts for micro and macro-economic trends, which allows it to support customers when neither financial companies or public and corporate policies can.”

For a nominal monthly subscription fee, Line gives users “an emergency line of funds without interest or credit checks, or the need to establish either credit history or a steady income.”

Line also helps people “avoid overdrafts and late payments, actively monitors each customer’s credit, gives users up to 20% cash back on everyday transactions, and will soon help them build credit on those transactions.”

Akshay continued:

“We are built on a partnership rather than a predatory model, with the fundamental belief – from having lived it – that people are doing their best with what they’ve got for themselves and their families. By knowing that to be true, and coming from a place of trust, we’re able to have an industry-leading repayment rate and incredibly high customer retention that credit cards and products for the ultra wealthy would envy.”

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