- Neo Financial announced recently that it raised $25 million CAD in Series A funding along with $25 million CAD in debt facility financing. These are the details.
Neo Financial – a Canada-based financial rewards company founded by Andrew Chau, Jeff Adamson, and Kris Read – announced recently that it raised $25 million CAD in Series A funding along with $25 million CAD in debt facility financing. This funding round marks one of the largest Series A funding rounds in Western Canada.
Valar Ventures led the funding round. Known for making multiple successful investments in the financial technology space, Valar Ventures was started by James Fitzgerald, Andrew McCormack, and PayPal co-founder Peter Thiel. Valar Ventures also previously backed several prominent companies including Xero, N26, Transferwise, and more.
And other Series A investors included Tobias Lütke (the CEO and founder of Shopify); Golden Ventures; Inovia Capital; Thomvest; Afore Capital; Maple VC; FJ Labs; and District Ventures (the venture firm founded by Arlene Dickinson from Dragon’s Den). The $25 million debt facility was provided by financial partner ATB Financial.
In Canada, the big 5 banks own 90% of the market share. And Neo was created to bring much-needed innovation and choice to consumers in Canada. As a new challenger in Canada’s financial sector, Neo’s proprietary technology was designed to simplify finances and create rewarding experiences for Canadians. Plus Neo offers Neo Savings, a high-interest savings account that earns members up to 30 times more than the big 5 banks and the Neo MasterCard and Rewards program that combines spending and savings together on one seamless platform.
And with this latest investment, Neo will continue to serve the increasing demand for financial innovation and optionality in Canada. Plus consumers across Canada can open a Neo account today and have access to Neo spending, savings, reward products, and be the first to access new account features as they continue to roll out.
Through partnerships with leading financial institutions, Neo offers members with a safe and secure way to spend and save. Neo’s credit card is issued by ATB Financial and backed by Mastercard. And the Neo Savings account is provided by Concentra Bank, a CDIC member institution and is eligible for CDIC deposit protection.
KEY QUOTES:
“With the tremendous support of our investors, particularly through the challenging circumstances of COVID-19, we’re accelerating the development of Neo’s product offerings and expansion across Canada. Now more than ever we are seeing the need for digital transformation in industries like banking, and Neo is at the forefront of that in Canada. Our team has set out to not only build new technology that challenges Canada’s existing financial sector, but also drives a cultural shift in how Canadians bank.”
– Neo co-founder and CEO Andrew Chau
“We’re excited to partner with the team building Neo Financial. They are building a powerful technology platform which provides the modern banking services consumers around the world have come to expect – and are still not getting from the traditional banks in Canada. We see massive opportunities for new entrants in the banking industry globally, particularly in places dominated by a few old banks that have gotten too comfortable and forgotten how to innovate. Neo’s unique approach will have a significant impact for consumers all over Canada who are ready for a financial platform that works for them.”
– Andrew McCormack, a founding partner of Valar Ventures
