Wagestream, a British start-up business that provides a financial support app for workers, has raised £135 million ($176 million U.S.) in a Series C funding round led by Smash Capital.

The company, based in London, provides frontline workers with early access to up to 50% of their earned wages. The app gives workers more control over their finances by offering a range of services. Employees have the option to invest a proportion of their wages directly into stocks, savings accounts and they can access financial advice.

The company was founded in 2018 and is based in London. The new funding, which comes in the form of $60 million in equity from Smash Capital and $116 million in debt from Silicon Valley Bank, will be used to add more features to the app and to launch in the U.S. Since launch over one million workers from 300 companies globally have used Wagestream’s app, mainly in the retail, hospitality and healthcare sectors.

It is mainly used by workers who are paid hourly or by the shift, rather than those who receive regular weekly or monthly salaries. The app has seen strong growth in the U.S. where 250,000 employees across those frontline industries have access to the app. It is sold to employers and workers can decide if they want to use it or not. Key clients include Burger King, Popeyes, Crate & Barrel and University of Chicago.

Payroll on demand as a service has gained traction in the last few years, partly due to more people working on temporary contracts or as part of the gig economy and partly due to financial uncertainty linked to the pandemic.

Wagestream co-founder and CEO Peter Briffett (LinkedIn profile) thinks his app can help solve some of the financial wellbeing issues employees in the U.K. face and that employers can help by providing more useful options of how to manage and invest their earnings. Portman Wills, who is CTO is the other co-founder.

“We are trying to solve workers’ financial pains,” said Briffett. “We’re building a positive route for frontline workers”

The company is built on a social charter and is part-owned by U.K.-based financial charities, including the Joseph Rowntree Foundation, Barrow Cadbury Trust, Social Tech Trust, Big Society Capital and the Fair by Design fund.

“Financial exclusion and a rising cost of living have created severe financial stress for hard-working people around the world,” said Brad Twohig, managing partner at Smash Capital.

“We’ve invested in Wagestream because its team has reimagined the world of work to solve that problem – making it more inclusive and rewarding for millions of people.”

Wagestream previously won funding rounds of £15 million Series A in 2019 and a £20 million Series B in 2020. It is also active in Spain and Australia.

 

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