A new challenger bank in the U.S., NorthOne, has raised $21 million in a Series A funding round, according to a release.
While fairly common in Europe, challenger banks in the U.S. are less prevalent. The bank has its sights set on small businesses, startups and freelancers. The funding round was led by Battery Ventures and both Redpoint Ventures and Tom Williams participated.
NorthOne, which has an API-enabled platform, says it was built specifically for small businesses, from the ground up. The bank features customer service teams that speak several languages, about 300,000 ATMs in its network and what it calls seamless vendor payments.
In addition, the bank also features software integration with accounting, expense and eCommerce tools.
The bank said it signed up 1 percent of all new small business accounts in the U.S. in the latter half of last year, with many in the Deep South and Midwest.
“We created NorthOne to serve businesses that are often underserved by big banks. Having grown up in a family of small business owners myself, I know first-hand what to expect when it comes to small business banking,” said CEO Eytan Bensoussan. “With this funding, NorthOne will be able to continue to develop solutions that simplify the most painful part of managing a small business, its finances.”
The bank said it’s going to use the new funding on things like marketing and acquiring new customers, as well as product development and growing its team of engineers.
“NorthOne started when we asked ourselves how we could make small business owners more successful. We set out to create a challenger bank that solves real problems,” the bank said on its site. “From day one to today, our mission has been to make the financial system more inclusive and rebalance the economy from the bottom up.”
The bank was founded in 2017 by Bensoussan and Justin Adler.