DailyPay, an earned wage access fintech company, announced that it is raising $175 million in its latest funding round that will help fuel its planned business expansion.
This funding is composed of a $100 million expansion of its secured credit facility from Citi and more than $75 million in equity financing, elevating the company’s pre-money valuation to $1.75 billion.
The equity round saw participation from both existing and new investors, spearheaded by Carrick Capital Partners. These funds are earmarked for accelerating product innovation and expanding into new markets and adjacent categories.
Furthermore, the $100 million boost to its credit facility, courtesy of Citi, increases DailyPay’s total revolving secured debt capacity to $660 million. This includes prior commitments of $500 million from Barclays and $60 million from TPG Angelo Gordon.
Kevin Coop, CEO of DailyPay, expressed enthusiasm about the funding, highlighting the company’s commitment to empowering workers through its innovative pay platform.
“This infusion of equity capital, supported by our longstanding and new financial partners, reinforces our leading market position and the strength of our business model. We are excited to leverage this momentum to continue transforming the future of pay,” Coop said.
CFO DailyPay CFO Ken Brause welcomed Citi into their distinguished group of financial collaborators.
“The additional credit facility funding comes at a pivotal time as we experience rapid growth in client and user acquisition, reflecting our business’s size, scale, and trajectory,” Brause added.
FT Partners played a pivotal role as the exclusive strategic and financial advisor to DailyPay during the equity financing deal.
DailyPay’s partnerships span across various industries, collaborating with Fortune 500 giants like Hilton, Target, Kroger, and Dollar Tree. Employers offering DailyPay’s services have observed significant improvements in hiring and retention rates.
The platform allows users to manage their earned income effectively, enabling timely bill payments and reducing reliance on overdrafts, high-interest credit products, or payday loans.
A new research recently released by DailyPay demonstrated the positive impact the firm’s products can “have for employers, many of whom are still challenged with a tight labor market.”
The study said employees stay longer, “are more productive, and are more motivated at work when they have the highly sought-after financial wellness benefit.”