Funding U, which helps college students access loans for education, has secured $14m in a debt and equity round.
The equity investment totalled $4m and was supplied by Deciens Capital, Valor Ventures, MacKenzie Scott, Next Act Fund LLC and The JumpFund.
The remaining $10m was a credit facility from Goldman Sachs Urban Investment Group.
This extra funding will be used to help Funding U to scale its operations and provide “last gap” loans, credit education and career networking to students attending four-year colleges in the US.
Founded in 2016, Funding U uses AI analytics to assess academic and earnings data to provide better priced products to borrowers whose parents can’t or prefer not to co-sign a loan.
Funding U CEO and co-founder Jeannie Tarkenton said, “Traditional student loan decisions at banks are made based on co-signer FICO. This practice shuts out millions of historically underrepresented students seeking $3,000-10,000 loans every year to cover the last mile of college costs after financial aid, small-cap federal loans and grants.
“Accessing a college degree is proven to increase earnings by $1 million over a lifetime, as well as stabilize employment in times of recession. Our borrowers and portfolio outcomes to date have proven that academic success, employability and earnings potential should be the factors that assess the risk of a student loan – not simply FICO scores or parent income level.”
Copyright © 2020 FinTech Global
