Credit Karma Goes for Insurtech

Consumer-facing financial health company Credit Karma unveiled plans for an auto insurance comparison tool. Starting today, members in California and Texas can determine if they are paying too much for car insurance based on how much similar members are paying for comparable coverage.

The move aims to help members make the best decision about their auto insurance, coverage that Credit Karma estimates Americans overspend on by $21 million each year. The new tool builds on Credit Karma’s Online Vehicle Center. Launched in November of last year, the Online Vehicle Center is an informational dashboard that helps consumers manage and organize their vehicle-related finances and information by leveraging driver and vehicle data from the DMV.

The Online Vehicle Center tool received significant traction since launching just under one year ago; more than 8 million members, 8% of Credit Karma’s total user base, have synced their vehicle information with the platform. The new comparison aspect of the tool leverages DMV information and combines it with data from credit bureaus and public insurance filings to estimate insurance quotes. Unlike traditional insurance quote comparisons, which require users to input 30 to 40 fields of data, Credit Karma generates a comparison in real-time.

“We built the auto experience to help put money back into the pockets of our members. With our refinance experience, we’ve helped our members save nearly $150 million on their auto loans in under a year,” said Kenneth Lin, founder and CEO of Credit Karma. “We plan to do the same for insurance.”

Another aspect of the new tool that’s worth mentioning is the education piece. Credit Karma will offer users an interactive experience that shows how certain factors such as moving violations and credit score can impact rates. The San Francisco-based company said that it plans to roll out the new tool to users in more U.S. states “in the coming months.”

At FinovateSpring 2009, Credit Karma CEO Ken Lin demonstrated the company’s platform, which offers free credit reports from Equifax and TransUnion, and seeks to serve as a hub for users to monitor their financial health. Since it was founded in 2007, the company has expanded not only into vehicle information management and monitoring but also identity monitoring and tax filing. Most recently, Credit Karma acquired mortgagetech startup Approved to move beyond its basic mortgage rates comparison tool.

Credit Karma Buys Mortgage Platform Company

Consumer credit monitoring and financial health company Credit Karma is furthering its reach into the real estate sector this week with the acquisition of mortgagetech startup Approved.

In a blog post yesterday, Approved Founder and CEO Andy Taylor announced that Credit Karma had acquired the three-year-old startup for an undisclosed amount. “Working with Credit Karma gives us the resources and immediate scale to accelerate our mission-driven work, reaching significantly more homebuyers than we could have imagined when we started,” Taylor said.

Credit Karma, which previously offered a basic mortgage comparison tool, is bolstering its capabilities with Approved at a time when many Millennials are beginning to purchase their own homes. As the company’s Chief Product Officer Nikhyl Singhal explained in an interview with TechCrunch, “As we’ve expanded, you’ve seen us move from credit cards as a way to help members with that part of their life to first personal loans to auto — meaning auto loans, auto insurance,” he said. “Today, we’re really talking more publicly about mortgage. Mortgage being for many of our members the most important financial decision they’ll make.”

Having facilitated almost $5 billion in loan originations, Approved was launched in 2015 by Taylor and co-founder Navtej Sadhal. The two met while working at RedFin, where they realized a need for disruption in the back-end of the mortgage process, where inefficiencies such as fax machines are still prevalent. Taylor vowed to stay true to Approve’s humble roots, adding, “We can’t wait to reveal what we’re working on next.”

Credit Karma already hosts many financial tools such as credit monitoring, tax filing, and credit card comparisons. By adding a more robust mortgage platform to this list, the company is creating a more sticky ecosystem with which to hook its 80 million users, half of which are Millennials.

At FinovateSpring 2009, Credit Karma CEO Ken Lin demonstrated the company’s platform, which offers free credit reports from Equifax and TransUnion, and seeks to serve as a hub for users to monitor their financial health. The company has facilitated the origination of more than $40 billion in credit products since it was founded in 2007. Earlier this year, the company teamed up with SpyCloud to help users determine if their data is being used on the dark web. Check out our recent interview with Colleen McCreary, Credit Karma’s first Chief People Officer.

Finovate Alumni News

On Finovate.com

  • Credit Karma Buys Mortgage Platform Company.

Around the web

  • Coin Telegraph: Ripple partners with three crypto exchanges as part of XRapid solution
  • Insuritas partners with Alabama One Credit Union and Alabama One Agency Insurance Services to provide insurance offerings for members.
  • figo receives ZAG license and enables ‘License as a Service’ through RegShield.
  • NPR features how PayActiv helps Americans avoid payday loans.
  • MX named one of fastest growing companies in Utah for 2018.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Credit Karma Hires Colleen McCreary as First Chief People Officer

Today, whether you are a small team in a backyard garage or the army of developers in the Googleplex, it is clear that building and sustaining a strong tech company is increasingly about building and sustaining a strong team. Colleen McCreary (pictured), the new Chief People Officer for Credit Karma, helps explain why this is so and how companies can make sure it happens.

Finovate: How long have you been at Credit Karma and what’s your background?

Colleen McCreary: I’ve been at Credit Karma for four months and have been working in various people/HR roles at tech companies for over 20 years. This is my fourth full-time role as a Chief People Officer. I started my career at large public companies but have spent the last decade focusing on scaling startups.

Finovate: Not every company has a Chief People Officer. When does a company know it’s time to hire one?

McCreary: I’m excited that I’m getting asked this question more often. There’s no perfect science, but you usually need someone in a senior capacity when your scale/growth has outgrown the basics you can read in a book. Because labor is usually your most expensive cost, at some point you want an expert who spends all their time thinking about it. Most of what a CPO brings is the ability to match behaviors with a toolbox of possible solutions.

 

Finovate: What are the challenges a Chief People Officer faces today compared to 5 to 10 years ago?

McCreary: In theory, people haven’t changed that much in terms of their motivation and desires. However, the big changes in the last five to 10 years have been around: 1) increasing employee confidence about vocalizing their opinions and concerns internally and externally, 2) rising expectations of career development/growth and a willingness to quickly move to another opportunity to find it, and 3) the rise of anonymous sites on the internet.

Finovate: What drew you to this field in general and why Credit Karma in particular?

McCreary:  I’ve spent my entire professional career in the technology industry because I love the pace of innovation and the impact it has on individuals and society. There’s nothing more impactful than the ability to gain financial independence. Credit Karma is at the intersection of all of this. However, most important to me was the amazing team that founded the company and the opportunity to work with someone as mission-focused as (CEO) Ken Lin.

Finovate: What skills are most important for a Chief People Officer?

McCreary: There are probably a lot of different answers to this, but when I coach other CEOs who are looking to hire a CPO, here’s my list:

  • Deep experience across multiple areas (recruiting, compensation, employee development, performance management)
  • A strong point of view and a willingness to share it and push back when appropriate
  • Orientation around using data to guide/influence decision-making
  • Strong operations experience
  • Ability to lead/coach people of all backgrounds
  • A thick skin and sense of humor because you can’t please everyone

Finovate: How does a Chief People Officer measure success in her role?

McCreary: From a metrics perspective, we tend to look at things like reduced regrettable attrition, manager effectiveness, offers accepted, NPS (net promoter score) as an employer, etc. However, I think there are some less measurable aspects around employee willingness to vocalize opinions publicly, perceptions of accountability, and overall employee trust in leadership.

Finovate: Thank you for your time.

With more than 80 million members across the U.S., Credit Karma offers free credit scoring, monitoring, and reporting to help consumers better manage their debt. Credit Karma helps users of its platform understand how their credit scores impact their ability to get loans and provides personalized recommendations to help consumers save money and use credit more wisely.

One of Finovate’s earliest alums, Credit Karma demonstrated its Debt Manager solution at FinovateSpring 2009. The company was founded in 2007 and is headquartered in San Francisco, California.

Finovate Alumni News

On Finovate.com

  • Signicat and Mitek Team Up to Improve Digital Onboarding.
  • Meniga Scoops Up $3.6 Million in New Funding Courtesy of UniCredit Investment.
  • OutSystems’ $360 Million Funding Round Boosts Valuation Above $1 Billion.
  • Credit Karma Hires Colleen McCreary as First Chief People Officer.

Around the web

  • Oman’s Bank Sohar to deploy core banking platform from Infosys Finacle.
  • IdentityMind Global announces update of its trusted digital identities platform.
  • Revolut CEO Nikolay Storonsky tells Reuters his company will seek a banking license in the U.S.
  • i-Sight to deploy ACI Worldwide’s Case Management solution to fight bank fraud.
  • D3 Banking Technology unveils new account opening service.
  • collectAI improves Hanseatic Bank’s receivables management with a 24 percent higher collection rate.
  • SMArtX adds 18 new strategies.
  • Kony unveils new digital banking solution – Kony DBX
  • Edwards Federal Credit Union signs with Bankjoy to enhance home and mobile banking functionality.
  • Two of the top 5 US banks (and three of the Top 10) are now using Socure’s ID+ platform.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Credit Karma Partners with SpyCloud to Add Dark Web Data Monitoring

Not long ago, a poster at the Credit Karma Credit Advice forum wrote:

I’ve been seeing links to see if my personal data is on the “dark web.” Is this something Credit Karma can do?

Now we know the answer to that question is “yes.”

Credit Karma has expanded its identity theft monitoring offering to include data from the dark web. Courtesy of a partnership with fellow Finovate alum – and Best of Show winner – SpyCloud, Credit Karma will dramatically increase the number of data breaches it is able to review for its 80 million users. Currently searching 4.5 billion public breaches, the new service will boost the total number of data breaches searched to 13 billion.

Vice President of Data Products Anish Acharya explained to TechCrunch that the decision to offer the dark web data breach search service was important for its users, and that a “pervasive” problem like identity theft from data breaches required a “comprehensive” solution. Credit Karma users can access the dark web monitoring service via the app in the ID Monitoring option in the Settings menu. The service can be accessed online via the Resources tab at the company’s website.

Credit Karma’s move comes less than a year after the company introduced its free identity monitoring service. This service provides users with monitoring, notifications, and advice such as how to report fraud, freeze their credit, or change their passwords. It adds to the free credit monitoring and personalized financial recommendations that has been the Credit Karma’s stock in trade since the company provided its first free credit score in 2008.

“Over the last ten years, you’ve come to rely on us as we continue to look for ways to help you save money and stay on top of your financial identity, and we take that trust seriously,” Credit Karma Product Manager Adam Boender wrote on the company’s blog when the new service was announced last fall. “As part of our mission to be your financial assistant, it made a lot of sense for us to build and provide ID monitoring as data breaches have become more prevalent.”

Last month, Credit Karma announced a $500 million secondary investment from Silver Lake that boosted its valuation to $4 billion. Named to the Forbes Fintech 50 in February, Credit Karma began the year partnering with American Express to offer tax refund advances. Credit Karma is one of Finovate’s earliest alums, demonstrating its technology at FinovateStartup 2009. The company is headquartered in San Francisco, California, and was founded in 2007. Kenneth Lin is CEO.

Making its Finovate debut at FinovateFall 2017 – and earning a Best of Show award – SpyCloud protects businesses and their customers from account takeover (ATO) attacks – a form of cyberfraud that is increasingly common due to the widespread reuse of passwords. The company’s solution protects Windows accounts from takeover automatically and leverages its rich dataset to launch new fraud investigations of potentially exposed customer and employee accounts, including those compromised credentials being actively traded on the dark web.

Founded in 2016, Austin, Texas-based SpyCloud has recovered more than 32 billion breached assets and more than 500,000 C-level executive records. The company’s technology recovers six million credentials a day and more than 50 breached databases per week. Read our feature on SpyCloud from last fall, SpyCloud Spots Stolen Credentials with Deep Dives into the Dark Web.

$500 Million Secondary Investment Boosts Credit Karma’s Valuation to $4 Billion

San Francisco-based Credit Karma received a $500 million boost today from Silver Lake. Through a secondary investment process, the technology investing company is taking a significant minority stake from existing investors in the consumer credit monitoring and financial health startup through a secondary investment process. Founder and CEO Kenneth Lin will remain the largest shareholder. Additional terms of the transaction were not disclosed.

Unlike a primary funding round, Credit Karma will not receive any proceeds from the sale and will not issue new shares as a part of the deal. It will, however, benefit from a 23% increase in valuation, making it worth around $4 billion. As TechCrunch explained, the move may be beneficial in placating investors and employees who are eager to cash out their equity, as well as help postpone an IPO.

Lin, who cofounded the company in 2007, said, “As we planned for the future and our continued growth, we sought a partner that could support our growth trajectory and provide existing investors an opportunity to lock in some of the rewards they’ve earned for their support and hard work.”

Silver Lake Managing Partner, Mike Bingle, will join Credit Karma’s Board of Directors. In the press release, he cited multiple reasons for investing in Credit Karma, including the company’s “cutting-edge technology” and its “unwavering focus on long-term partnerships” with both members and financial institutions.

While it’s best known as a consumer-facing tool to help users check their credit for free, Credit Karma’s functionality extends far beyond credit scores, credit card offers, and loan comparisons. Last November, the company launched a new automotive information center where members can manage and organize their vehicle-related finances and information. And in late 2016, Credit Karma unveiled Credit Karma Tax, a free online tax filing service that, thanks to a partnership with American Express, lets users opt to receive their tax refund in advance. The company even has a tool to help return unclaimed money to users.

Credit Karma has 80 million members across North America, almost half of which are millennials and 80% of which access the service via their mobile devices. The company has originated more than $40 billion in credit products including credit cards, personal loans, mortgages, automotive financing, and student loan refinancing. At FinovateSpring 2009, Lin demonstrated the company’s platform, which offers free credit reports from Equifax and TransUnion, and seeks to serve as a hub for users to monitor their financial health.

Finovate Alumni News

On Finovate.com

  • Finicity Announces Full Integration with BeSmartee.
  • $500 Million Secondary Investment Boosts Credit Karma’s Valuation to $4 Billion.

Around the web

  • Jack Henry’s banking division announces that seven banks will implement its Core Director core processing platform.
  • FlexTrade to integrate Kensho into its FlexTRADER EMS real-time event feed.
  • Finastra hires new Chief Product and Technology Officer, Eli Rosner.
  • iSignthis subsidiary, iSignthis eMoney, forges payment aggregation agreement with American Express Australia.
  • Best of Show winner Trusona joins ForgeRock’s identity management platform.
  • Gartner recognizes BRIDGEi2i with an Honorable Mention in the Magic Quadrant for Data and Analytics Service Providers, Worldwide.
  • Kabbage shows loan growth via the mobile channel, with 17% of all SMB loans and 15% of total dollars accessed via its platform coming through mobile.
  • Find Biometrics interviews Deepak Dutt, president and CEO of Zighra.
  • Payfone on track to authenticate 19 billion transactions for Fortune 100 clients in 2018.
  • Fort Dodge Family Credit Union to implement Larky Engagement Platform.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Forbes Names 17 Finovate Alums on the Forbes Fintech 50

Forbes has released the third* Fintech 50 list, which this year features 17 Finovate alums, many of which have made the list for the third time. The Fintech 50 list highlights the top private fintechs that have operations, customers or impact in the U.S. The list excludes public companies and divisions of public companies.

Here are the alums honored in this year’s compilation:

Ayasdi

Among 22 newcomers to this year’s list.

Betterment

The company’s third time making the list.

Blend

Among 22 newcomers to this year’s list.

Blockchain

Among 22 newcomers to this year’s list.

Chain

The company’s third time making the list.

Coinbase

The company’s second time making the list.

Credit Karma

The company’s third time making the list.

Feedzai

Among 22 newcomers to this year’s list.

Gusto (formerly ZenPayroll)

The company’s second time making the list.

Kabbage

The company’s second time making the list.

Kensho

The company’s third time making the list.

Plaid

The company’s third time making the list.

Qapital

The company’s second time making the list.

Ripple

The company’s third time making the list.

Symbiont

Among 22 newcomers to this year’s list.

Symphony

The company’s second time making the list.

TransferWise

The company’s third time making the list.

In 2016, the list contained 20 Finovate alums, including Betterment, Chain, Coinbase, Credit Karma, Gusto, Kabbage, Kensho, Klarna, Motif, Personal Capital, Plaid, Qapital, Quantopian, Ripple, Signifyd, SoFi, Symphony, TransferWise, TrueAccord, and Xignite.

The list from three years back also contained 20 Finovate alums. Algomi, Betterment, Braintree, Chain, Credit Karma, HelloWallet, Kensho, LearnVest, Motif, Personal Capital, Plaid, Prosper, Quantopian, Ripple, Simple, TransferWise, TrueAccord, Vouch, Wealthfront, and Xignite made the list.


*Forbes skipped this compilation for 2017.

Credit Karma Teams with American Express to Offer Advance Tax Refund

With the new GOP tax law in place, Americans have begun thinking about April 15– the tax filing deadline. Taking advantage of this new awareness, consumer credit monitoring and financial health startup Credit Karma has made a move to attract users to its new tax filing service with the launch of Earlybird Advance.

Earlybird Advance is a no-fee, no-interest loan from MetaBank that allows users who file through Credit Karma to claim from $500 to $1,000 of their tax refund as soon as 24 hours after the IRS accepts their tax return. This is a step up from the three-to-four week time period it generally takes for taxpayers to receive their funds.

“Because filing taxes with Credit Karma Tax is completely free, not only can Americans keep their entire refund, Earlybird Advance can also help them get some money sooner,” said Jagjit Chawla, Credit Karma Tax General Manager. “It’s our way of helping people who can’t wait weeks for their refund.”

Users will receive their advanced funds on an American Express Serve Prepaid Card. The card has no monthly fees and allows users to withdraw their funds for free at more than 24,000 ATMs nationwide. As soon as mid-January, users can apply online in less than two minutes to qualify for the loan.

California-based Credit Karma launched its tax service in December of 2016. The product allows users to prepare and file their taxes for free with a simple process that offers insights to make their taxes easier and more accurate.

Since launching in 2007, Credit Karma has raised $368 million. After its last fundraising in 2015, the company was valued at $3.5 billion. At FinovateSpring 2009, Credit Karma CEO and founder Ken Lin demonstrated the company’s platform, which offers free credit reports from Equifax and Transunion, and seeks to serve as a hub for users to monitor their financial health.

Last summer, the company launched Credit Karma Mortgage, a tool that helps homeowners discover savings opportunities available through refinancing. And in the fall of 2017, Credit Karma unveiled Online Vehicle Center, an automotive information center that serves as a one-stop shop to help consumers manage and organize their vehicle-related finances and information.