Novo raises $4.8 million seed round to make banking easier and more accessible for small businesses with no-fee, FDIC-insured digital banking
Venture capitalists are betting big and pouring millions of dollars into fintech banking startups. One of the firms is Crosslink Capital. The firm is leading a $4.8 million seed round in Novo, an early-stage startup founded that offers startups and small business owners the technology they need to focus on their businesses. Other backers in this round include: Red Sea Ventures, Hack VC, RRE, Rainfall, and the Stanford Law School Venture Fund.
Novo’s mission is to make banking easier, more secure and accessible for small businesses by launching no-fee, FDIC-insured digital banking. Since Novo’s launch in September of 2018, startup founders and small business owners have been able to apply for business checking accounts in under 10 minutes, securely and easily with no minimum balance requirements. In short, Novo offers business banking products without any paperwork or hidden fees. Getting a Novo account gives customers access to a free business checking account with debit card access, all managed through the mobile app.
Founded in 2016 by Michael Rangel and Tyler McIntyre, Novo is a modern banking platform that gives business owners the technology they need while getting partner banks the customers they want. Backed by a network of FDIC-insured community banks partners, Middlesex Federal Savings, Novo has been able to leverage the abilities of a nationally chartered and regulated bank while building proprietary technology to create the bank account modern businesses need. Everything from reviewing balances and transaction monitoring to processing free bank transfers and checks, Novo gives users the flexibility to bank on their own terms from wherever they are.
“Today everything from your toaster to your thermostat can be integrated into your business’ workflow, and we think your bank should be able to do the same,” explains Tyler McIntyre, Co-Founder and CTO. “Traditional banks don’t understand the needs of founders and are held back by legacy technology. We built Novo from the ground up allowing us to deploy new features every week and integrate into the tools you already use for your business. That’s the way banking should be.”
“Their value proposition is simple yet brilliant. Novo brings low-cost deposits in exchange for bank sponsorship,” says Jim Feuille, Venture Partner at Crosslink Capital and Novo Board Member. “Essentially becoming a decentralized technology and marketing arm for banks by recreating the way they acquire and retain customers, which is why we decided to lead the round with $3.5 million to scale their growth.”
“We couldn’t be happier with the support of Crosslink Capital, Jim Feuille, and the rest of the great investors in the syndicate,” says Michael Rangel, Co-Founder and CEO. “Our focus will be on onboarding the many account requests on our waitlist, as well as creating strategic partnerships with other value-added products and services to enhance the Novo ecosystem and customer experience in addition to expanding our team.”
Novo aims to become the “financial watchtower for small business” offering data analytics through multiple partners and integrations with Slack, Stripe, Zapier, and leading accounting software to give users real-time insights and notifications on the financial health of their small businesses.