StellarFi, a financial technology company on a mission to disrupt the U.S. poverty cycle by opening access to credit, announced it has “exceeded $1 million in annual recurring revenue.”
The company “emerged from stealth on June 28 and closed its oversubscribed $7 million initial funding round in March.”
Alex Harris, General Partner Fiat Ventures, said:
“The rate at which StellarFi is gaining traction is unheard of yet unsurprising as investors and consumers turn to innovative financial wellness solutions. Reaching $1 million in ARR less than five months after launch is reminiscent of the growth I saw at Chime and is a true testament to the resiliency of StellarFi’s model.”
StellarFi’s performance amid recessionary macroeconomic conditions “stands in contrast to the daily reports of tech-company layoffs and a decrease in the number of startup unicorns.”
Instead, StellarFi claims it is “positioned for continued growth as an anti-fragile fintech startup precisely because its value proposition succeeds during market downturns and upturns.”
Roughly 61% of U.S. residents “live paycheck to paycheck. More than 150 million Americans, half the country’s population, currently have credit scores below 680.” Twenty million of those have “fallen into this category since the onset of the pandemic.” StellarFi anticipates the economic downturn “will drive another 30 million into this addressable market during the coming year.”
Lamine Zarrad, StellarFi founder and CEO, who has launched three companies, commented:
“The path to surpassing $1 million in annual recurring revenue is typically a much longer journey for most startups. Even with economic headwinds, the convergence of StellarFi’s top-notch team, its superb tech and the market opportunity has made this achievement possible.”
StellarFi helps its members “build credit by consolidating all bills and reporting payments directly to Experian®, Equifax® and Transunion®, adding to a foundation of a positive payment history.”
StellarFi does “not require a credit check, deposits, and charges no interest rates. The company’s success lies in its absolute product-market fit, especially in today’s macroeconomic climate.”
The impact of record inflation and rising interest rates on average Americans “has been devastating.” People are grappling “with inflation of 8.2%, a 40-year high; short-term borrowing rates that are at their highest since January 2008; and average credit-card interest rates above 22%.”
Mike Vaughan, StellarFi investor and former Venmo COO, remarked:
“StellarFi has a unique and appealing approach to improving their members’ financial profiles while consolidating their bills. Similar to Venmo, StellarFi understands consumer needs and the value of a simple user experience. StellarFi has the potential to become ubiquitous in the credit-building and bill payment spaces.”
StellarFi’s members enjoy “an average of a 26-point increase in their credit scores during the first month.”
About 66% of members “select the company’s Prime plan which allows them to report up to $25,000 in bills.”
The company’s growth metrics in 2022 are:
- 105% ARR growth during the past month\
- 83% member growth during the past month
- A minimum of 50% month-over-month ARR and member growth since its June public launch
- A doubling of average bills per account that demonstrates member engagement and retention
StellarFi’s team “comprises experienced fintech startup veterans.’
The company’s leaders have built two unicorns and achieved five exits.” Key hires since StellarFi’s launch “include Chief Marketing Officer Daniel Kjellen, Vice President of Finance and Operations Josh Holley, Vice President of Product Kevin Phillips and Vice President of Engineering Geoff Massanek.”
Founded in Austin, Texas, as a public benefit corporation, StellarFi is on “a mission to disrupt the U.S. poverty cycle by opening access to credit to the 150 million Americans who currently have poor credit or no credit.”