Wagestream gives frontline workers flexible access to pay. This is the 11-slide deck it used to raise a fresh $175 million in debt and equity.
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Wagestream gives frontline workers flexible access to pay. This is the 11-slide deck it used to raise a fresh $175 million in debt and equity.
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Wagestream has raised $175 million in debt and equity funding.
The startup lets frontline workers access their pay early.
The startup has brought in new funding from Smash Capital and funds managed by Blackrock.
Wagestream, a UK-based startup that lets workers access their pay early, has raised $175 million in debt and equity funding.
Founded in 2018, Wagestream works with employers to let employees draw down a percentage of their income in the month for a small, flat fee (£1.75/$2.3), which is increasingly covered by employers. Employers effectively then help to subsidize services which are typically more expensive for lower paid workers in the hospitality, health, and retail industries such as insurance products, utilities, and credit or loans.
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The company’s platform helps frontline workers track their shifts and pay each day, choose their own pay cycle, and set targets to build up their savings. Around 1 million employees can access Wagestream from companies such as Bupa, Halfords, Pizza Hut, Co-op, and the NHS.
“There’s a financial tsunami coming for all workers, as wages are not going up much but there is an increased cost of living,” Peter Briffett, Wagestream CEO told Insider. He added that early wage access was “not a magic wand”, but might help workers manage their finances.
Wagestream is also aiming to help frontline workers save at better interest rates, and and access goods and services more cheaply to counter, Briffett said, “the poverty premium.” Service workers are often paid weekly or bi-weekly, making it harder to make savings by bulk buying groceries or purchasing season tickets for public transport.
The startup’s Series C fundraise comprises a $60 million equity investment led by Smash Capital, a VC fund established by former Disney executives, alongside funds and accounts managed by BlackRock, and $115 million in debt financing from Silicon Valley Bank.
Wagestream will use the funding to expand into new products including insurance, utility switching, and rental deposit sponsorship, Briffett said. It also plans to expand in the US, having opened an office in Washington DC and made around 15 hires. It’s aiming for 45 by the end of 2022.
Wagestream is part-owned by financial charities including Joseph Rowntree Foundation, Barrow Cadbury Trust, Social Tech Trust, Big Society Capital, and the Fair by Design fund.
The fintech last brought in funding in July 2020 with a $25 million raise from Northzone.
