Financial wellbeing app Wagestream closes $175M Series C in largest ever fintech-for-good fundraise

 Wagestream, the financial wellbeing app founded with charities, designed for frontline workers and built around pay, has closed a $175 million Series C funding round as it prepares to scale up support for underserved, financially stressed workers beyond the UK. The round – believed to be the largest ever raised for a social impact fintech – comprises $60 million equity investment led by new investors Smash Capital, funds and accounts managed by BlackRock, and $115 million in debt financing from Silicon Valley Bank.

Historically, frontline workers have been excluded or forced to pay more for financial services than other workers. Research from the University of Bristol shows they pay a premium of £490 more for basic household and financial services each year – the equivalent of 14 weeks’ food shopping. With a social charter at its core​​, Wagestream was founded in 2018 by Peter Briffett (CEO), Portman Wills (CTO) and a group of leading financial charities to solve this problem – by giving people access to a set of fairer financial services, delivered through their employer, and built around their pay.

“When we launched Wagestream, many employers viewed financial wellbeing in the workplace as a long-term aspiration; now they realise it is a national emergency,” said Peter Briffett, Wagestream CEO and co-founder. For example, 93% of companies we recently surveyed plan to put a financial wellbeing program in place – up from 51% just one year ago. By addressing the financial wellbeing of their employees, employers become the hero and solve their own HR challenges in the process – from recruitment, to retention, to productivity.”

Workers access Wagestream through employers in industries such as hospitality, healthcare and retail, who subsidise the service. With financial inclusion in mind, the app provides a variety of financial services to help them build up their financial health over time. People can track their shifts and pay each day, choose their own pay cycle, build up savings and win prizes, set money goals and chat to a personal financial coach, and get fairer deals on financial products –  like insurance, utilities and credit for essential services – than they would have access to elsewhere.

The funding round is led by new investors Smash Capital – a U.S.-based investment firm focused on later-stage consumer Internet and technology companies. Smash’s prior investments include Epic Games, Reddit, SonderMind, and DuckDuckGo, among others. Smash’s founders previously led investments for The Walt Disney Company and leading venture capital firms. The round also includes new investors, BlackRock and joined by follow-on investments from existing shareholders Balderton Capital, Northzone, charity fund Fair By Design, and new financing from Silicon Valley Bank.

“Financial exclusion and a rising cost of living have created severe financial stress for hard-working people around the world,” said Brad Twohig, Managing Partner at Smash Capital. “We’ve invested in Wagestream because its team has reimagined the world of work to solve that problem – making it more inclusive and rewarding for millions of people.”

Originally launched in the U.K., the Series C capital will be used to build a broader set of fair financial services within the app and scale up Wagestream’s growing teams outside the U.K. One million workers now can access Wagestream globally through over 300 employers in the U.S., U.K., Spain and Australia.

Katie Duxbury, Head of Payroll Services at leading healthcare provider Bupa, which rolled out the app to its workforce in 2021, said: “Wagestream has been amazing for our people. By offering a range of charity-backed financial wellbeing tools built around pay, we’ve been able to empower them to build better financial health – all managed through one smart app.

Part-owned by charities including Joseph Rowntree Foundation, Barrow Cadbury Trust, Social Tech Trust, Big Society Capital, and the Fair by Design fund, Wagestream is accountable to an Impact Advisory Board and reports on social impact to its shareholders each quarter. Emma Steele, Partner at Ascension, explains: “it’s time for fintech businesses to reach and include the 2.7bn global frontline workforce in a fair financial system. As a pre-seed backer of Wagestream, we’ve watched the business quickly evolve from its ‘beachhead’ flexible pay tool proposition to a global fintech scale-up, bringing a broad range of financial wellbeing tools to over one million people and growing at an impressive scale. We are so proud of what the team continues to achieve – they are an undeniable proof that purpose-led vision and commercial scale go hand in hand.”

The company puts research, data and customer co-creation at the heart of its product roadmap, and publishes a bi-annual Impact Assessment, which tracks the impact of its financial services on end-customers. The app outperforms global benchmarks on financial inclusion set by independent impact measurement firm, 60 Decibels, with 77% of people reporting feeling less stressed, and 72% reporting an improved quality of life.