Clair, a mission-driven fintech company, has secured $175m in funding to introduce a free, consumer-friendly, on-demand pay solution.
The programme, backed by an FDIC-insured bank, allows front-line workers to access wage advances through banking partner Pathward. As part of the offering, consumers gain access to Pathward’s FDIC-insured Clair Spending and Savings Accounts, along with other financial services.
The funding round includes a $25m equity injection led by Thrive Capital, with participation from Upfront Ventures and Kairos. The total venture capital funding for Clair now amounts to $45m, and Michael Presser from Kairos joins as a board observer.
Thrive Capital partner Kareem Zaki said: “Clair’s product has enabled both workers and employers to adapt in a uniquely challenging labor and economic environment.
“In addition to their exponential growth this past year, we’ve been pleased to see that Clair has consistently prioritised compliance and delivering tangible value to their customers.”
After experiencing a remarkable 10x revenue growth over the past year, Clair plans to utilise the new funding to expand its team and drive adoption, particularly among the 76 million hourly workers who make up 56% of the US workforce.
The fintech company has already integrated its platform with popular software such as Humanity Scheduling by TCP Software, When I Work, Gusto Embedded, and 7shifts, allowing over 50,000 workers to receive instant payments upon completing their shifts, eliminating the need to wait for traditional paychecks.
Clair’s mobile banking app, catering mainly to millennial and Gen Z customers, offers substantial savings by helping them avoid overdraft fees worth $15m annually, as well as steering clear of payday lenders with exorbitant interest rates.
Amid a shortage of front-line workers, both small and large businesses are embracing Clair’s innovative solution, offering earned wage advances to their employees. With four million more job openings than available candidates, companies are leveraging unique benefits like Clair to attract and retain staff.
Organisations such as EverView, Viking Ranges, SanStone Health & Rehabilitation, as well as franchisees of DoubleTree by Hilton, Sheraton Hotels & Resorts, and GNC, have adopted Clair to provide their employees with immediate access to earnings.
Additionally, Clair has launched “Clair for Employers,” a comprehensive financial wellness benefits package for businesses not yet integrated with Clair’s partner platforms. This offering seamlessly integrates with companies’ existing payroll providers at no cost, requiring no ongoing maintenance and ensuring compliance.
Employees of companies using Clair for Employers can also enjoy additional features within their Clair Spending Account, including 3% cashback on gas and grocery purchases made with their Clair Debit Mastercard.
Clair co-founder and CEO Nico Simko said: “Front-line workers are astonishingly underserved, as big banks don’t see them as profit drivers and aren’t building the solutions they need.
“This lack of support is unfair when half of Americans live paycheck to paycheck and don’t have $500 in savings for an emergency, so timely pay is crucial for them to keep up with their bills. We’re grateful to join forces with investors, partners and employers who believe in our mission of enabling people to responsibly customize their pay cycles to their needs.”
