Bloom Credit is helping fintech and other businesses that want to provide credit products, such as lending, personal finance or credit monitoring, work with the country’s three credit bureaus. To accelerate that work, the New York-based startup secured $13 million in Series A funding.
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Within that investment, $10 million was led by Allegis NL, along with Resolute Ventures, Slow Ventures and Commerce Ventures. The other $3 million was a previously unannounced round from a group of angel investors including Sheel Mohnot and Jake Gibson, Jeff Cruttenden, Jason Gardner, Mark Goines and Ron Suber.
The new funding means Bloom has raised a total of $17 million since it was founded in 2016, Matt Harris, co-founder and CEO of Bloom Credit, told Crunchbase News.
Over the course of the last few decades, bureaus evolved from lots of distributors to consolidated data sets, but their technology has not caught up, Goines, a Bloom Credit investor and vice chair of Personal Capital, said in an interview.
Bloom Credit’s application processing interface (API) integrates with all three of the major U.S. credit bureaus and enables developers to request or submit credit bureau data more easily and in a more timely manner.
“It is still difficult to connect small enterprises with bureau data,” Goines said. “Bloom is in front of offering this API for bureaus, providing access for companies like Marqeta did for payments.”
The new funding will support the company’s plans to round out its leadership team and fill out teams in engineering, product and sales, as well as its growth team, which acts as customer support for companies offering credit products for the first time. It will also use the funding to launch new products, especially in furnishment, which is the way companies send information back to the credit bureaus.
The company has 16 employees and expects that number to rise to as many as 40 by the end of the first quarter of 2021. Within the past year, Bloom Credit has brought in 10 clients, many of them venture-backed startups.
Creating in-house credit products for startups, and even large companies, is often costly and takes time, Harris said.
For example, we reported in August about San Francisco-based Finix, which developed a payment processing infrastructure-as-a-service platform allowing startups to bring their e-commerce payments infrastructure in-house. In an interview, Richie Serna, Finix’s CEO, said building an API from scratch can cost anywhere from $3 million to $5 million in upfront costs and take two to three years to complete.
As with Finix, Bloom Credit businesses are able to launch new credit products and services in a matter of weeks, Harris said.
“It can take years to launch a credit product,” he added. “Chime is an example of a company wanting to do credit for years, and launched other products for a decade before being able to do a credit product. Venmo talked about a card two years ago, and just now announced it. Even though these are large companies with resources, it still takes a long time. Working with Bloom takes weeks.”
Illustration: Li-Anne Dias