Aspiration, the online bank launched by a former speech writer for President Bill Clinton, has raised $47 million in Series B funding from a variety of celebrities and celebrity investors.
According to TechCrunch, Andrei Cherny, Aspiration’s founder and chief executive, said this is the largest Series B in financial technology investment history for an online banking company in the United States.
Aspiration’s business model is an inversion of typical retail banks, which make their money off everything from overdraft fees to late payment fines to ATM charges.
“Those moments when the customer is feeling pain is when the banks make their money,” Cherny pointed out. These banks also make money selling products that consumers don’t actually need.
With all of this in mind, Cherny saw the opportunity for a bank that would cater to a customer who is not only concerned with where their money is being invested, but also with how the bank treats its customers.
Aspiration’s core product is its Summit personal banking account, which provides 1 percent interest and is fossil fuel-free. The checking account also enables banking customers to track their personal spending and check it against Aspiration’s sustainability monitoring and scoring system, which gauges companies’ corporate social responsibility on a number of different metrics. The online bank also offers investment and retirement services.
So far, the bank has accounts totaling $350 million in savings, with about $2 billion per year now transacted across the Aspiration platform. The company makes money by charging a fee set by the customer for the services they use.
“What we see is that the vast majority of customers are choosing to pay across all products, and most are choosing to pay a very fair amount,” Cherny said.
The additional capital will be used to help develop a new suite of credit and lending products to further expand Aspiration’s array of banking services.
Investors in the Series B round included Allen & Company, Omidyar Network, Alpha Edison, AGO Partners, Reyl & Cie and Capricorn Investment Group, as well as individual investors like the actor Orlando Bloom, Los Angeles Clippers coach “Doc” Rivers, former Citigroup chief operations and technology officer Deborah Hopkins, Bad Robot president Brian Weinstein and Rustic Canyon Partners founding partner Tom Unterman.