Stripe backs Step – the digital bank for teens | Capital risk

The giant of digital payment solutions, Bandaged, reinvested in the San Francisco-based fintech banking start-up for teenagers, Walk.

Series C has raised $ 100 million in capital from a number of backers, including Coatue, TikTok star Charli D’Amelio, actor Jared Leto and Will Smith’s Dreamers VC, for the company.

Step provides teens with an FDIC insured bank account and Visa card. The accounts are backed by Evolve Bank and there is no subscription fee for its use. Users don’t pay for their accounts, and there are no overdraft fees either.

The mobile banking app allows parents to set spending controls and limits and encourage responsible finances. According to data released by the company, 88% of platform users say it is their first bank account.

Major funders

To date, Step has been very successful in the market. The company has raised more than $ 175 million from investors and now has 1.5 million users.

Stripe, which was founded by Irish brothers Patrick and John Collison, previously helmed Step’s $ 22.5 million Series A in 2019.

Step’s Series B fundraiser also grossed $ 50 million and has a clearly celebrated reputation with investors such as Justin Timberlake and pop duo The Chainsmokers.

Users have access to a free FDIC-backed bank account, charge card, and P2P payment platform to send and receive money instantly.

CJ MacDonald, Managing Director of Step, said the company aims to improve the financial future of the next generation. “Step is the only banking platform that allows teens to start building a positive credit history before the age of 18 and charges no fees.

He has already spoken about the importance of financial literacy for young people. “Money is just one of those things where I think the earlier you are educated and equipped, the better decisions you can make,” he said. “And you can also save yourself costly mistakes. I mean, the average American doesn’t have $ 400 in emergency savings and pays $ 350 a year in bank charges. If we can help this new generation ultimately be smarter and more educated when it comes to money, I think we will all be better off. “

Kyle Doherty, Managing Director of General Catalyst and Member of the Board of Directors of Step, explained, “Generation Z is flocking to modern financial solutions that can be easily integrated into their digital lives and Step has a unique model for it. reach.”

Acquisition of TaxJar

The news follows Stripe’s recent announcement that it is considering acquiring TaxJar. FinTech, which creates software for online businesses that automates the reporting and filing of sales taxes, will most likely be integrated with Stripe’s billing services.

Currently, no terms have been disclosed, but the Boston-based startup has raised more than $ 60 million from investors, including Insight Partners.

Dhivya Suryadevara, CFO of Stripe, said of the move, “With TaxJar, we will help millions of internet businesses operating on Stripe with their sales tax and make it easier for them to sell internationally.”

Stripe also recently closed a $ 600 million funding round that valued the TaxJar at $ 95 billion and invested heavily in fintech startups, including Ramp and Check.