Stripe has led a $22.5 million Series A funding round for Step, a teenager-focused US mobile banking startup that has built up a half million-strong waitlist in a matter of months.
In the week that JPMorgan Chase shut down its millennial-focussed mobile venture Finn, Step has pulled together a host of glitzy backers. Stripe was joined in the round by famous names including movie star Will Smith, through his Dreamers fund, and rapper Nas.
The brainchild of Gyft co-founder CJ MacDonald and Square veteran Alexey Kalinichenko, Step is building a mobile-based bank account - held with Evolve Bank - specifically designed for teens that is interest bearing and has no hidden or overdraft fees.
The mobile app is linked to a Mastercard and lets users send and receive money instantly, shop online or in-store as well as use Apple Pay and Google Pay. Strip is providing issuing and processing technology.
Parents get oversight into their teen’s spending, providing the opportunity for them to set limits and guidelines as well as have a view into card use.
Step will use the new funding to make hires and accelerate its roadmap as it gets ready for launch, taking on what it calls the "pre-banked" population.
Says MacDonald: "We’ve partnered with the best in the business to create the right solutions for the next generation. As we move into a cashless era where digital content and transactions fuel our daily lives, the need for innovation in financial services increases. We want Gen Z to be more equipped and educated when it comes to money."