Fintech HMBradley Takes a Different Path, Raises $18M

Sarah Favot

Favot is an award-winning journalist and adjunct instructor at USC's Annenberg School for Communication and Journalism. She previously was an investigative and data reporter at national education news site The 74 and local news site LA School Report. She's also worked at the Los Angeles Daily News. She was a Livingston Award finalist in 2011 and holds a Master's degree in journalism from Boston University and BA from the University of Windsor in Ontario, Canada.

Fintech HMBradley Takes a Different Path, Raises $18M

Backed by PayPal founder Max Levchin, fintech company HMBradley offers a hybrid savings and checking account and brags that it has an interest rate up to 3%.

The model has proved popular and on Tuesday, the Santa Monica-based digital banking platform HMBradley announced it has raised $18.25 million in Series A funding in a round led by Acrew Captial.


Zach Bruhnke, HMBradley's co-founder and CEO, said in an interview that he didn't foresee a Series A round happening so quickly after the platform launched on March 30, but deposits have grown faster than expected.

"I think we were very much prepared for this to be a slow burn," he said. "We were going out saying we're going to build slow and steady."

HMBradley gives up to a 3% interest rate on savings to users who save 20% or more of their direct deposits each quarter no matter how much money they earn. There is a tiered system, so the higher percentage of your deposits you save, the higher the interest rate will be, up to 3%.

Zach Bruhnke

HMBradley's co-founder and CEO Zach Bruhnke

The fintech firm said it has received over $90 million in deposits and its users have an average account balance of $30,000, while transaction volume has grown to over $110 million.

"Our customer base, they like to be rewarded for having good behavior and that's exactly what we're doing," Bruhnke said. "You save more, you earn more that's a big part of the focus."

The company differentiates itself from other fintechs by charging fees, trying to compete with customers who would normally bank at traditional banks rather than other digital banks that don't charge fees.

Bruhnke said the product has appealed to customers who are focused on saving and being rewarded for it with higher interest rates.

"What we didn't expect is how fast it would catch on with that audience," he said.

The Series A funding will help the company add to its growing employee roster, which expanded from 13 to 25 employees. The company recently hired Ben Coffman, who built the Capital One mobile app, and Saira Rahman, a former AVP at Alpine Bank and head of West Coast derivatives at B&F Capital Markets.


The money will also be used to build new tools for customers like bill pay and remote check deposit. Bruhnke also wants to help customers understand their cash flows to make better financial decisions.

Acrew Capital was also an early investor in Chime, another digital banking service, based in San Francisco.

Editor's note: This story has been updated to omit Finix and Deserve as funders in the Series A. They were not.

Subscribe to our newsletter to catch every headline.

Cadence

Activision Buys Game Studio Proletariat To Expand ‘World of Warcraft’ Staff

Samson Amore

Samson Amore is a reporter for dot.LA. He previously covered technology and entertainment for TheWrap and reported on the SoCal startup scene for the Los Angeles Business Journal. Send tips or pitches to samsonamore@dot.la and find him on Twitter at @Samsonamore. Pronouns: he/him

Xbox\u2019s various game developers it now owns: Activision, Blizzard and King.
Courtesy of Activision Blizzard

Activision Blizzard intends to acquire Proletariat, a Boston-based game studio that developed the wizard-themed battle royale game “Spellbreak.”

Read moreShow less
https://twitter.com/samsonamore
samsonamore@dot.la

Bling Capital’s Kyle Lui On How Small Funds Can Better Support Young Founders

Minnie Ingersoll
Minnie Ingersoll is a partner at TenOneTen and host of the LA Venture podcast. Prior to TenOneTen, Minnie was the COO and co-founder of $100M+ Shift.com, an online marketplace for used cars. Minnie started her career as an early product manager at Google. Minnie studied Computer Science at Stanford and has an MBA from HBS. She recently moved back to L.A. after 20+ years in the Bay Area and is excited to be a part of the growing tech ecosystem of Southern California. In her space time, Minnie surfs baby waves and raises baby people.
Bling Capital’s Kyle Lui On How Small Funds Can Better Support Young Founders

On this episode of the LA Venture podcast, Bling Capital’s Kyle Lui talks about why he moved earlier stage in his investing and how investors can best support founders.

Lui joined his friend—and first angel investor—Ben Ling as a general partner at Bling Capital, which focuses on pre-seed and seed-stage funding rounds. The desire to work in earlier funding stages alongside someone he knew well drew him away from his role as a partner at multi-billion-dollar venture firm DCM, where he was part of the team that invested in Musical.ly, now known as TikTok.

Read moreShow less
RELATEDEDITOR'S PICKS
LA TECH JOBS
interchangeLA
Trending