The founders built their own infrastructure from scratch, opting for a direct banking partnership instead of using a third-party banking-as-a-service (BaaS). The startup makes money primarily from interchange revenue and from partnering with other brands. The new capital will be used for expansion, product development, and hiring in sales, marketing, and engineering. Fizz competes with cards from big banks as well as Rocket Money and Credit Karma on its budgeting and AI feature set.
Key takeaways:
- Fizz, a startup founded by Carlo Kobe and Scott Smith, has raised $14.4 million in seed funding led by Kleiner Perkins, with participation from SV Angel, Y Combinator, New Era Ventures, and the founders and operators behind several unicorns.
- The startup offers a debit card product specifically designed for Gen Zers, with a core artificial intelligence budgeting product and gamified financial literacy courses. It targets college students aged 18 to 24.
- Fizz has built its own infrastructure from scratch and opted to have a direct banking partnership, rather than offer its services through an intermediary, or third-party, BaaS. It has partnerships with Lead Bank, Mastercard and the credit bureaus.
- The company plans to use the new capital for expansion, product development, and hiring in sales, marketing and engineering. It competes with cards from big banks such as Discover, Capital One and Bank of America, as well as with Rocket Money and Credit Karma on its budgeting and AI feature set.